Balance Billing from provider

[bhwang12]

What is the name of your state (only U.S. law)? NJ

I received a balance bill from the out-of-network doctor (specialist in plastic surgery) that performed surgery (stitches) last November. At the time, I went to the ER room at the nearest hospital and was told that the surgery would be complex and that there is no one at the hospital that could perform the surgery.
Fast forward couple months, I received the explanation of benefits and a balance bill.

Surgery 1 - Billed Amount = $3950, Allowed Amount = $1425
Surgery 2 - Billed Amount = $6950, Allowed Amount = $6950
Balance Bill from doctor = $2525

I called both the doctor and insurer, both tried to turn responsibility to another. Insurer says that they came up with the allowed amount $1425 by taking into consideration "Multiple Procedure Payment Reduction" which reduces second surgery performed on the same day by 50%. I mentioned this to my doctor to let him know this but he says that it is not a law so he does not have to abide by this. I called the insurer back and let them know my doctor is not going to take the 50% discount but the response they gave me is that pretty much I am left held responsible for the balance and that the only thing I could do was to attempt an appeal. Does anyone have experience with this "Multiple Procedure Payment Reduction" and if it is legal for the insurer to do this?

I feel like I am being thrown left behind in the middle of the insurer and provider because they both don't want to be responsible. Is there anything I could do to take care of this balance bill? Any laws that protect the patient from being responsible just because the insurer and health providers are not on the same page?

Thanks in advance

 

[justalayman]

I don't understand your issue.

the services were performed by an out of network provider. They (out of network providers) are not required to accept any amount less than their billed rate. So, you owe the balance and your insurance company is not liable to pay for anything more than what your policy says they are liable to pay.

 

[tranquility]

http://www.americanbar.org/newsletter/publications/aba_health_esource_home/aba_health_law_esource_1111_gold.html

The New Jersey Department of Banking and Insurance also prohibits physicians with a contractual relationship with a health plan from balance billing HMO members and extends the ban on balance billing to out-of-network providers who treat HMO members based on a referral from a participating provider or the HMO itself.13 After receiving a number of complaints concerning an Aetna policy that purported that payments received by out-of-network providers be considered as payment in full, the Department of Banking and Insurance ordered HMOs to “pay the non-participating provider a benefit large enough to insure that the non-participating provider does not balance bill the member for the difference between his billed charges and the . . . payment, even if it means that [the HMO] must pay the provider’s billed charges less the member’s network copayment, coinsurance or deductible.”14 Here too, HMO patients are completely insulated from financial responsibility, excepting any applicable copayments and deductibles.

http://kff.org/private-insurance/state-indicator/state-restriction-against-providers-balance-billing-managed-care-enrollees/
http://blog.horizonblue.com/articledetails/stop-don%E2%80%99t-pay-doctor%E2%80%99s-bill-yet

 

[Zigner]

I don't understand your issue.

the services were performed by an out of network provider. They (out of network providers) are not required to accept any amount less than their billed rate. So, you owe the balance and your insurance company is not liable to pay for anything more than what your policy says they are liable to pay.

Actually, this is specifically disallowed in New Jersey.

See http://www.state.nj.us/dobi/pressreleases/pr070725_ordera07_59.pdf

(Aetna got in big trouble)

ETA: Yeah, what Tranq said.

 

[cbg]

Was the poster referred to the OON doctor by his PCP or another in-network provider?

If so, what Tranq said.

If not, then I don't see that the quoted law applies.

 

[justalayman]

Actually, this is specifically disallowed in New Jersey.

See http://www.state.nj.us/dobi/pressreleases/pr070725_ordera07_59.pdf

(Aetna got in big trouble)

ETA: Yeah, what Tranq said.

Does anybody have any link to the actual laws or policy statements from a government entity speaking to the matter?

I find it difficult to believe that a member of an managed care policy can simply ignore the preferred provider system or member provider system and go to anybody they choose and expect that provider to be required to accept the managed care payment as payment in full. There has to be something that activates that mandate.

 

[tranquility]

Was the poster referred to the OON doctor by his PCP or another in-network provider?

If so, what Tranq said.

If not, then I don't see that the quoted law applies.

I agree. There are a lot of issues. That is why I gave a range of resources with each giving a little different slant.

A page listing a few cases is at:
http://www.klgates.com/files/Publication/7097c2ef-e36b-4f64-8e9c-b19cb39923e6/Presentation/PublicationAttachment/2e601acf-8cd7-4b5b-9828-68378ed3a97c/NJ-Law-Journal.pdf

 

[cbg]

The New Jersey Department of Banking and Insurance also prohibits physicians with a contractual relationship with a health plan from balance billing HMO members and extends the ban on balance billing to out-of-network providers who treat HMO members based on a referral from a participating provider or the HMO itself.

It's right there.

Thus my comments.

 

[justalayman]

The New Jersey Department of Banking and Insurance also prohibits physicians with a contractual relationship with a health plan from balance billing HMO members and extends the ban on balance billing to out-of-network providers who treat HMO members based on a referral from a participating provider or the HMO itself.

It's right there.

Thus my comments.

but that also speaks only of an HMO. Does it apply to PPO's or any other managed care system?

and if it does not apply to the other managed care systems, does the OP have an HMO?

 

[tranquility]

but that also speaks only of an HMO. Does it apply to PPO's or any other managed care system?

and if it does not apply to the other managed care systems, does the OP have an HMO?

In the summary chart at the second link, it says it does apply to PPO.

 

[LdiJ]

but that also speaks only of an HMO. Does it apply to PPO's or any other managed care system?

and if it does not apply to the other managed care systems, does the OP have an HMO?

The only thing that I can add to this thread is the NJ is about the most consumer friendly state in the US that I know of when it comes to health insurance issues. I actually did some research on it while back due to a situation that seemed impossible.

 

[ecmst12]

I will say that reducing charges for multiple procedures done at the same time is extremely common and extremely reasonable. The time and equipment needed to do 2 procedures at once is a lot less than one at a time. OP might just need to go up the chain at the dr's office on this.

 

[bhwang12]

I will say that reducing charges for multiple procedures done at the same time is extremely common and extremely reasonable. The time and equipment needed to do 2 procedures at once is a lot less than one at a time. OP might just need to go up the chain at the dr's office on this.

Right, I understand the concept of it and that it does make sense. But since it is not a written law, I want to know if it is okay for the insurance company to apply this concept when calculating their allowed amounts. It is because of this 50% reduction on the second surgery that is causing the discrepancy between the doctor's billed amount and the allowed amount from the insurer for the surgery. For example, lets say a person hired a gardener to do some gardening work. The gardener performed two tasks, garden work and backyard work. Soon after, bill comes in stating two separate amounts for each task. Person who hired gardener looks at the bill and goes, "since you did two things on the same day, you saved time/resources so I am only paying you 50% for the second task".
I just don't see how it is permitted for insurers to calculate their allowed amounts with a 50% reduction for the second surgery when it is not even a law AND the provider never agreed to the reduction.

 

[cbg]

It's allowed because there isn't a law that says it's not allowed. (State specific exception noted above)

And the provider, or at least his billing office, WILL be involved in permitting the reduction.

 

[justalayman]

Right, I understand the concept of it and that it does make sense. But since it is not a written law, I want to know if it is okay for the insurance company to apply this concept when calculating their allowed amounts. It is because of this 50% reduction on the second surgery that is causing the discrepancy between the doctor's billed amount and the allowed amount from the insurer for the surgery. For example, lets say a person hired a gardener to do some gardening work. The gardener performed two tasks, garden work and backyard work. Soon after, bill comes in stating two separate amounts for each task. Person who hired gardener looks at the bill and goes, "since you did two things on the same day, you saved time/resources so I am only paying you 50% for the second task".
I just don't see how it is permitted for insurers to calculate their allowed amounts with a 50% reduction for the second surgery when it is not even a law AND the provider never agreed to the reduction.

it doesn't matter if it is law or not. What matters is what the policy states. As long as the action within the policy is not contrary to any laws, it is a matter of contract.


You need to understand the insurance policy (in what you are speaking of) is a contract between you and them. They can include whatever rules they want to include, as long as it is not contrary to existing law. The doctor, if an in network provider, does have a contract with the insurance company. In that, generally the doctor agrees to take what the insurance company determines to be the proper amount of payment with no recourse allowed for the doctor (other than something such as appealing the matter based on an improper classification of the procedure or such).

so, the only real issue is whether this provider can bill you for the balance. As you should have seen in the discussion, there are situations where it is allowed and situations where it is not allowed in NJ when dealing with a manage care system and an out of network provider. Care to shed any light on the information needed to make that determination?