Research shows patients are more willing to utilize emergency services when unexpected bills are not a concern.
The No Surprises Act may have the unintended effect of causing millions more emergency department (ED) visits, according to a study from the Agency for Healthcare Research and Quality.
Since going into effect on January 1, 2022, the federal ban protects patients from surprise bills for emergency services at out-of-network facilities or for out-of-network providers at in-network facilities.
The study, published in The American Journal of Medical Care, compares ED visits in 15 states with balance billing bans between 2007 and 2018 to ED visits in 16 states without bans to examine the ripple effects of a significant reduction in out-of-pocket payments under the No Surprises Act.
Researchers found that the bans in the 15 states reduced spending per visit by 14%, but also resulted in an increase of 3% in ED visits, which offset the cost savings. The extra visits, however, were considered 9% less urgent than prior to the bans, based on the emergency service index.
From the findings, the authors calculate that the No Surprises Act will lead to 3.5 million more ED visits per year, with the $4.2 billion in extra spending largely wiping away $5.1 billion in savings.
"With such a large reduction in expected out-of-pocket cost of an ED visit, one would expect a possible increase in ED visits after a surprise bill ban, especially with all the media coverage that often surrounds the passage of the ban," the authors state. "Because individuals will no longer have the fear of a possible catastrophic surprise ED bill not covered by their insurer, they may be more inclined to go to the ED in marginal, less severe cases."
The study notes that many of the extra ED visits observed were for the diagnosis categories of "sprains and strains" and "superficial injuries; contusions," showing that the increase in quantity of visits is for less urgent cases.
While the protections afforded by the No Surprises Act is certainly beneficial for patients, it may put pressure on hospitals and health insurers to deal with the increased ED visits and the costs that come from that.
"Because this may also occur more broadly for the 2022 NSA, insurers and primary care physicians may want to renew efforts to prevent costly, avoidable ED visits," the authors conclude.
A study examines the differences in reimbursement for medical decision-making (MDM) billing and time-based billing.
Which billing model leads to more revenue for physicians? That depends on length of patient visit, according to a study published in JAMA Open Network.
The findings revealed time-based billing was associated with higher reimbursement for longer evaluation and management (E/M) visits, whereas MDM billing was associated with higher reimbursement for shorter visits.
To compare the billing models, researchers used 2018 National Ambulatory Medical Care Survey summary data, 2019 billing data for outpatient E/M codes, and 2021 reimbursement rates from CMS.
MDM billing is used under a fee-for-service model, which remains the most common among U.S. physicians and reimburses providers for E/M services based on the number and complexity of problems addressed in a patient visit. This does not include medical record review, documentation, and coordination of care, meaning physicians are left with unreimbursed hours for after-hours work.
Time-based billing, on the other hand, reimburses physicians based on the length of visit, which previously only accounted for time spent face-to-face with patients.
However, changes made to time-based billing guidelines in 2021 now allow physicians to also be reimbursed for time spent on medical record review, documentation, and coordination of care on the day of the visit.
Results of the study showed that yearly E/M revenue was dependent the length of patients visits for MDM billing. The shortest visits, spanning 20 minutes with new patients and 10 minutes with return patients, led to the highest E/M revenue of $846,273.
As visits increased to 30 minutes for new patients/15 minutes for return patients and 40 minutes for new patients/20 minutes for return patients, yearly E/M revenue decreased to $564,188 and $423,137, respectively. The longest visits, spanning 90 minutes for new patients and 45 minutes for return patients, created the least revenue at $188,065.
With time-based billing, revenue remained mostly similar across visit lengths, with $400,432 generated for 30 minutes with new patients/15 minutes for return patients and $458,718 for 40 minutes with new patients/20 minutes with return patients.
The highest revenue was associated with the shortest visit, $567,649 for 20 minutes with new patients/10 minutes with return patients, while the lowest revenue was generated for the longest visit, $385,614 for 50 minutes with new patients/25 minutes with return patients.
Though the findings reveal the advantages of time-based billing for longer visits, the researchers note that MDM billing still leads to the most revenue when visits are shorter, which incentivizes physicians with greater volume.
Where time-based billing really shines is in its capability of freeing physicians up.
"Previous studies have shown that physicians with time constraints are less likely to complete preventive medicine tasks. Therefore, the flexibility in patient scheduling afforded by time-based billing could help physicians better address preventive medicine," the researchers stated.
"A decrease in patients per hour could also be used to help physicians complete non–face-to-face tasks, such as documentation, that traditionally have been pushed to after hours, potentially contributing to decreased physician burnout."
A survey finds the rate of increase for costs across categories such as medical and prescription drugs has slowed but should normalize.
While healthcare costs have seen reduction in the rate of increase, inflation has yet to affect premium rates for employer-sponsored health plans, according to a report by Buck.
The human resources consulting firm released its 43rd National Healthcare Trend Survey of nearly 100 health insurers and health plan administrators, finding that the recent increase in prices is not yet reflected in trend factors payers use to set premiums.
Harvey Sobel, Buck principal, consulting actuary, and survey director, stated that claims shot up in 2021 due to residual demand from COVID-19.
"While a temporary reduction in trends is welcome, activity is projected to normalize in 2022," Sobel said. "Health plans will be under pressure to increase provider reimbursement rates in reaction to the rise in inflation as their provider contracts come up for renewal."
Health insurers and administers surveyed reported medical trend factors that vary by product, averaging 5.8% to 6.9%, down by 1-2 percentage points from the previous survey. The Preferred Provider Organization plan was at 6.4% for the average trend factor, down by 1.4% from the prior year.
With prescription drugs, insurers reported a weighted average trend of 8.1%, down 0.7% from 2021, whereas the weighted average trend reported by Pharmacy Benefit Managers increased from 6.2% to 7.5%.
On the Medicare side, the trend factor for plans continued to increase, up from 5.0% in the previous survey to 5.6%. It marks the sixth consecutive increase since 2018, when the trend factor was a reported 3.0%.
As costs rise for employer-sponsored plans, employers will also feel the brunt.
According to analysis by Aon, employee premiums from paychecks increased by 0.6% in 2022, and costs as a whole are projected to increase to more than $13,800 per employee in 2023.
Inflationary pressures combined with higher utilization rates following COVID will create financial challenges for payers and employers alike.
The Improving Seniors' Timely Access to Care Act, on the strength of overwhelming support, now heads to the Senate.
The widely-supported legislation that aims to reform prior authorization in Medicare Advantage (MA) plans has been unanimously passed in the House, a decision advocated by several medical groups.
Now on its way to the Senate, the Improving Seniors' Timely Access to Care Act is one step closer to establishing an electronic prior authorization program to streamline requests for services under MA plans, which would help mitigate unnecessary denials or delays in care.
MA plans have been under scrutiny of late for their prior authorization processes, with a recent report by the Office of Inspector General finding that MA organizations often delay or deny services for medically necessary care, even when coverage rules are met.
As well as potentially resulting in negative outcomes for patients, unnecessary prior authorization also creates administrative burden for providers.
Several medical groups have already offered recommendations on improving the process and following the House vote to advance the bill, the associations reiterated the importance of prior authorization reform.
Stacey Hughes, executive vice president of the American Hospital Association: "This legislation takes important steps to reduce the burden and complexity of prior authorization requirements imposed by Medicare Advantage plans. These provisions will help Medicare patients access the care they need in a timely manner while reducing the strain on our already taxed health care workforce."
Jack Resneck, president of the American Medical Association: "The House recognized that prior authorization is an insurance companies' practice that is overused, costly, opaque, burdensome to physicians, and harmful to patients due to delays in care. The American Medical Association is committed to fixing prior authorization and made doing so a central plank of our Recovery Plan for America's Physicians."
Anders Gilberg, senior vice president of Government Affairs for the Medical Group Management Association: "The transparency provisions included in this legislation — requiring MA plans to publicly reveal what services are subject to prior authorization, how many are approved, and how long on average they take to approve — will drive plan accountability. By streamlining and standardizing the overly cumbersome and wildly inefficient MA prior authorization process, this legislation will return a focus to the physician-patient relationship and prevent dangerous delays to timely care."
New research finds a correlation between hospitals with fewer beds and lack of adherence to the price transparency mandate.
Hospitals across the board have so far struggled to meet CMS' price transparency requirements, but smaller facilities are more susceptible to noncompliance, according to a study by Northwestern University's Feinberg School of Medicine.
The research, published in ClinicoEconomics and Outcomes Research, identified characteristics of 6,214 hospitals using data from the American Hospital Association Annual Survey, as well as cash prices of commonly performed procedures and visits from Turquoise Health.
While price transparency compliance ranged from 13% to 49% of hospitals studied, the findings revealed that facilities with fewer beds were less likely to be compliant with the rule. Additionally, hospitals located in the South and the West were also associated with less transparency.
Since going into effect on January 1, 2021, the mandate requires hospitals to disclose gross charges online through a comprehensive machine-readable file with all items and services they provide, as well as through a display of shoppable services in a consumer-friendly format.
"The findings of this study shine light on the poor state of price transparency for healthcare services throughout various specialties in hospitals across the US and elucidate pertinent relationships between hospital characteristics and price transparency," the researchers stated.
The study notes that It's unclear if the lower rate of price transparency in smaller hospitals can be attributed to a lack of resources or a reduced penalty for noncompliance on CMS' sliding scale based on hospital bed count.
The rate of price transparency based on region, meanwhile, could be due to less competition in the area, resulting in decreased motivation for hospitals to disclose prices as patients don't have much ability to shop around, the researchers suggest.
However, this reasoning runs counter to the recent JAMA study which found hospitals in less competitive markets and those with greater market shares have higher price transparency compliance rates.
Authors of that study noted that higher compliance rates in less competitive markets were in line with the idea that hospitals safeguard their prices when facing more competition.
It's one thing for hospitals to comply with pricing requirements—it's another for them to do so in a patient-friendly manner.
In the Feinberg School of Medicine study, 62% (3,873) of hospitals reported prices for at least one of the 14 billable healthcare services, which were chosen due to their high volume of usage and representation across medical fields.
Researchers said it was a "tedious task" to obtain list prices from hospital chargemasters, which involves navigating multiple hospital websites, finding the correct chargemaster listed, and understanding billing terminology.
So even if a hospital is being transparent with its pricing, the complexity of the process to find the prices means patients may not end up benefitting anyways.
"Thus, the current CMS legislation’s efforts at price transparency fall short of its aim to provide patients with the necessary information to make informed care decisions," the researchers stated.
The groups allege the health insurer underpaid claims submitted by patients for services covered through MultiPlan.
The American Medical Association (AMA), as well as the Medical Society of New Jersey and the Washington State Medical Association, have joined a class action lawsuit against Cigna alleging underpayments for claims through the MultiPlan network, the nations' largest third-party network.
Originally filed in June by Cigna members, the lawsuit takes issue with the health insurer's reimbursements at its non-participating providers rate instead of a rate for a MultiPlan contract when services were received from a participating provider. As such, Cigna members were "exposed to the threat of balance billing," the lawsuit states.
The plaintiffs argue that MultiPlan contracts prohibit providers from billing patients for the difference between the original charges and the discounted rates, which Cigna is responsible for.
They claim the payer "also breached its fiduciary duties, including its duty to honor written plan terms and its duty of loyalty, because its conduct serves Cigna's own economic self-interest and elevates Cigna's interests above the interests of plan member patients."
AMA president Jack Resneck Jr. criticized Cigna for prioritizing its "economic self-interest" above its commitment to physicians and patients in the MultiPlan Network.
"The AMA and other physician organizations allege that Cigna's misconduct is riddled with conflicts of interest and manipulations that routinely shortchanged payments to MultiPlan Network physicians and interfered with the patient-physician relationship by ignoring the MultiPlan contracts and making incorrect statements to patients about their liability for the unpaid portion of the billed charges," Resneck said in a statement.
"By joining Stewart v. Cigna as a plaintiff, the AMA hopes to shed light on Cigna's misconduct and create remedies so that patients and physicians can look forward to getting what they are promised."
The physician group responds to the ruling by a Texas judge deeming a piece of the Affordable Care Act (ACA) unconstitutional.
The American Medical Association (AMA) has pushed back on the controversial ruling against a provision of the ACA, strongly stating that preventive care requirements must be upheld.
AMA president Jack Resneck called the elimination of no-cost preventive care "unwise and unthinkable" in a statementfollowing Judge Reed O'Connor's decision to strike down the ACA law mandating employers to cover an HIV prevention drug.
The federal judge ruled in favor of Steven Hotze, owner of Braidwood Management, who argued that being forced to buy health insurance for his employee to cover preexposure prophylaxis (PrEP) violates his religious beliefs.
Resneck stated: "Providing insurance coverage for drugs that prevent the transmission of infectious disease does not violate anyone’s religious freedom—to the contrary. This type of preventive care saves lives."
Preventive care not only saves lives and saves money, it's part of physician' ethical obligation to take care of patients, Resneck argues. He also pointed to research by HHS that found more than 150 million people benefited from preventive care services in 2020 alone.
"The AMA is alarmed by this line of judicial reasoning and we fear it could turn back the clock and limit access—not only to PrEP, but also to a long list of preventive services that physicians and patients depend on," Resneck said.
As the legal process for the preventive provision plays out, Resneck believes empowering, educating, and encouraging patients about their health is necessary.
He said: "In short, we need to build on the gains we've made under ACA, not abandon vital components of the law just as we’re starting to reap their benefits."
A new survey reveals what factors Americans weigh when seeking out healthcare, such as quality and convenience.
Unsurprisingly, patients are more than willing to reach into their pockets if it means receiving higher quality of healthcare, according to a survey by AKASA.
The revenue cycle firm commissioned the survey, which was conducted by YouGov, and fielded responses from 2,026 Americans in March to highlight what factors adults are willing to pay more for when choosing their providers.
Quality of care led the way, with 57% of respondents ranking it first among all factors. The next most important factor was the ability to work with a care team of choice, which was chosen by 47%.
The ability to work with hospitals of choice and location proximity or convenience were each selected by 41% of those surveyed, while 40% said they would pay more for the ability to get an appointment quickly.
The survey also asked how far patients are willing to travel for the best price in healthcare, assuming the quality is the same. Respondents revealed there is a limit, with 51% answering they would travel 10-20 miles for an optimal price, while 31% said they would journey as much as 50 miles. Beyond that, only 13% would travel 100 miles, 2% would go up to 200 miles, and 3% would trek up to 400 miles.
"The findings can help healthcare leaders prioritize what to focus on when thinking about their bottom lines through the lens of what patients are willing to pay for and aligning it with improving the patient experience," Amy Raymond, VP of revenue cycle operations at AKASA, said in a statement. "However, the quality of care is often diminished by the less-than-stellar patient financial experience."
Quality versus quantity has been a longstanding tug of war in healthcare, but the industry is attempting to shift more towards the former.
The transition has been a slow one however, as illustrated in a recent report by the Medical Group Management Association. The findings showed that revenue from value-based contracts in 2021 accounted for 6.74% of revenue in primary care specialties, 5.4% in surgical specialties, and 14.74% in nonsurgical specialties.
As patients prioritize higher quality of care, industry leaders must do the same.
Judge Reed O'Connor deemed the services unconstitutional, drawing heavy criticism from patient advocacy groups.
A key piece of the Affordable Care Act (ACA) requiring employers to cover an HIV prevention drug and other preventive services is in jeopardy after a federal judge ruled against it for violating religious freedom.
Judge Reed O'Connor of the U.S. District Court for the Northern District of Texas ruled in favor of Steven Hotze, owner of Braidwood Management, who claimed the ACA mandate violates the Religious Freedom Restoration Act.
Hotze specifically took issue with being forced to buy health insurance for his employees to cover an HIV prevention drug, preexposure prophylaxis (PrEP), arguing it "facilitates and encourages homosexual behavior, intravenous drug use, and sexual activity outside of marriage between one man and one woman," the ruling stated.
O'Connor wrote that "Braidwood has shown that the PrEP mandate substantially burdens its religious exercise."
Additionally, O'Connor found that the U.S. Preventive Services Task Force violates the Constitution's Appointments Clause, which deems how public officials are appointed, because of the scope of the task force's authority.
O'Connor previously ruled that the entire ACA was unconstitutional in 2018, arguing that the law was invalid because Congress zeroed out the penalty tied to its individual mandate. The decision was flipped by the Supreme Court, which upheld the ACA by a 7-2 vote in 2021 in the midst of the COVID-19 pandemic, allowing millions to retain their insurance coverage.
Patient advocacy groups have spoken out against O'Connor's most recent ruling, voicing their displeasure and warning of the dangers of the decision.
"The free preventive care guaranteed by the ACA has become a bedrock of our health care system, benefiting patients with all types of insurance, including those insured by their employer," Protect Our Care chair Leslie Dach said in a statement. "The consequences of this ruling cannot be understated and it is essential that Judge O'Connor stay the effects of his order while this disastrous decision is appealed."
The Medical Group Management Association (MGMA) and the American Hospital Association (AHA) have offered their recommendations on streamlining the administrative process.
Reforming prior authorization to cut down on treatment delays and administrative burden is a necessity for improving Medicare Advantage (MA), according to key medical groups.
MGMA and AHA have submitted their comments to CMS in response to a request for information on the MA program, with both groups offering recommendations on prior authorization policies.
Publish the Interoperability and Prior Authorization for MA Organizations, Medicaid and CHIP Managed Care and State Agencies, FFE QHP Issuers, MIPS Eligible Clinicians, Eligible Hospitals and CAHs proposed rule: This rule would improve the electronic exchange of data and streamline prior authorization processes, but MGMA believes the timeframe for when health plans should respond to medical groups for urgent prior authorizations and for standard prior authorizations should be shorter than the timeframe CMS proposed of 72 hours and seven days, respectively.
Implement recommendations included in the OIG report: The research revealed the MA organizations often unnecessarily delayed or denied members' access to services, even when prior authorization requests met coverage rules. Among its recommendations, OIG urged CMS to update audit protocols to prevent errors.
Reinstate step therapy prohibitions in MA plans for Part B drugs: MGMA notes that step therapy requires patients to try and fail certain treatments before allowing access to usually more expensive treatments, which allows health plans to undercut the provider-patient decision-making process.
Increase CMS oversight over MA plans' use of prior authorization processes.
Require transparency of payer prior authorization policies and establish evidence-based clinical guidelines available at the point of care.
Requires MAOs to follow traditional Medicare coverage rules to prevent unnecessary delays and burdens associated with inappropriate use of prior authorization.
Establish a standard electronic transaction for providers to submit and receive responses for prior authorizations.
Improve the quality and use of MAO data related to prior authorizations, including changes in the frequency of reporting, increased transparency, penalties for non-compliance, more targeted auditing, and suggestions for how these data could be incorporated into Star Ratings.
Reduce administrative waste in the MA program, including requiring plans to comply with standard, electronic process for prior authorization.
While prior authorization requirements can negatively affect patient outcomes, as shown in the OIG report, the administrative process can also hinder providers.
A recent survey by MGMA revealed that 79% of medical groups feel that payer prior authorization requirements increased in the past year. The increase is only putting more stress on providers, with 88% of physicians reporting that the administrative burden associated with prior authorization is high or extremely high, according to a survey conducted by the American Medical Association.