Assessment of Out-of-Network Billing for Privately Insured Patients Receiving Care in In-Network Hospitals

Abstract

IMPORTANCE Although surprise medical bills are receiving considerable attention from lawmakers and the news media, to date there has been little systematic study of the incidence and financial consequences of out-of-network billing.OBJECTIVE To examine out-of-network billing among privately insured patients with an inpatient admission or emergency department (ED) visit at in-network hospitals. DESIGN, SETTING, AND PARTICIPANTSA retrospective analysis using data from the Clinformatics Data Mart database (Optum), which includes health insurance claims for individuals from all 50 US states receiving private health insurance from a large commercial insurer was conducted of all inpatient admissions (n = 5 457 981) and ED visits (n = 13 579 006) at in-network hospitals between January 1, 2010, and December 31, 2016. Data were collected and analyzed in March 2019.EXPOSURES Receipt of a bill for care from at least 1 out-of-network physician or medical transport service associated with patient admission or ED visit. MAIN OUTCOMES AND MEASURESThe incidence of out-of-network billing and the potential amount of patients' financial liability associated with out-of-network bills from the admission or visit.

Preventing Financial Strain for Low- and Moderate-Income Adults: a Comparison of Medicaid, Marketplace, and Employer-Sponsored Insurance

“…Second, many Marketplace plans have narrow provider networks, 33,34 leaving some enrollees with large medical bills for out-of-network care, or compelling others to delay or forgo care when innetwork providers are inaccessible. 35,36 Third, since Marketplace plan enrollees had lower rates of continuous coverage, health care costs incurred during gaps in coverage 37 could have increased their financial strain. 20 Given that dental coverage is not mandated as an essential health benefit in either Medicaid or Marketplace plans, [38][39][40] predictably, enrollees from both plans had equal difficulty affording dental care in our study.…”

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“…That is, more than 4 in 10 trips to the ER led to patients getting surprise medical bills. 137 A recent study found that out-of-network billing by these medical specialists raises physician payments for privately insured patients and raises health care spending by $40 billion annually. 138 Hospital outsourcing of emergency, radiology, anesthesiology, and other departments has provided an opening for physician practices to operate these services as independent organizations.…”

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“…But, consider the practice of "surprise billing"; one study indicated that 40% of emergency department patients and inpatients received out-of-network bills for care delivered at in-network settings. 5 Not only has this practice, which is widely perceived to be unfair, drawn the attention of regulators, but it has been shown to lead to widespread mistrust of the medical system as a whole and, even more disturbing, to the avoidance of seeking care by patients. 6 Notably, all of these examples have effects that stretch far beyond any one organization because they affect individuals, institutions, entire classes of organizations, the health system as a whole and, crucially, patient health.…”