Examining Billing Disputes Between Providers, Insurers
The Los Angeles Times on Thursday, in the third installment of a three-part series on the U.S. health insurance system, examined how physicians and "hospital executives say collecting payments from insurers has become an expensive headache that is driving up the nation's health care costs."
According to the Times, "Billing disputes and protracted payment delays are one consequence of a massive consolidation among health insurers that has created de facto monopolies in much of the country." Four insurance companies cover nearly half of all privately insured U.S. residents, leaving doctors and hospitals "little negotiating power and few options when an insurer rejects a bill," the Times reports. As a result, some physicians have dropped out of insurance networks, turned away new patients, created cash-only practices or left the business entirely.
According to the Times, "Arcane and ever-changing coverage rules are a leading cause of fee disputes," and medical professionals and staff are "spending more and more time haggling with insures over claims or obtaining advance approval for treatments." Patients are "often dragged into the financial tug of war" when doctors try to recover unpaid balances from them after insurers reject or reduce claims, the Times reports. Thousand of physicians across the U.S. are involved in class-action lawsuits alleging that the nation's largest insurers are involved in a "conspiracy ... to deny, delay and diminish payments to health care providers."
Patients' rights groups and some state regulators also are pushing to overhaul the system insurers use to set out-of-network payment rates. The insurance industry has invested billions of dollars to develop claims processing software that can identify inflated charges, errors or inconsistencies. According to the Times, "Because most physicians use paper billing records, many say that challenging the insurers is like going into a gunfight with a butter knife." The Times reports, "To even the odds, some doctors, clinics and hospitals are investing in software of their own or outsourcing their billing to national companies that aim to pool enough providers to match the insurance industry's muscle" (Costello et al., Los Angeles Times, 10/23).
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