Coalition blasts Horizon’s out-of-network cost study

Health care providers say low reimbursement rates are biggest driver of issue

Upset by a recent report they felt could hurt their industry, a coalition of health care providers came out last week in opposition to putting caps on out-of-network medical payments.

The NJ Access to Care Coalition, a group of physicians, hospitals and other health care providers, criticized a study of the impact of out-of-network medical charges that was commissioned by the state's largest health insurer, Horizon Blue Cross Blue Shield of New Jersey.

The study, which was conducted by Avalere Health and released earlier in March, concluded that New Jerseyans could see lower monthly premiums if the state's current out-of-network regulations were changed.

Current state law requires that, when consumers receive emergency care from out-of-network hospitals and doctors, they can't be charged more than they would pay if they were in-network.

"New Jersey state law protects patients who, by no choice of their own, are seen by an out-of-network provider in an emergency situation," said Betsy Ryan, chief executive of the New Jersey Hospital Association.

"Imposing rate-setting measures on health care providers does nothing to improve access to care for patients; caps protect insurers, not patients."

Ryan said the out-of-network issue lies with insurers - most specifically, their willingness to work with health care providers.

"Instead of capping payments to providers, the health insurance industry should be focused on bringing more providers into their networks and providing better access to care for their members," she said. "Rate setting is a vestige of the past."

Horizon Chief Executive Bob Marino, in an editorial board meeting with NJBIZ in March, said caps would go a long way to curtailing providers who game the system for their own financial gain.

"Some - very few - have seen a business model here," he said.

Horizon spokesman Tom Vincz said insurers and health care providers have the same goal. And for the most part, he said, they are working together to meet it.

"Horizon and the vast majority of physicians have a common goal to ensure New Jersey residents receive the best possible health care at a reasonable cost," he said.

The issue, Vincz said, are the extreme examples of inappropriate bills.

"When an out-of-network doctor can charge excessive amounts such as $12,500 for a stress test, $10,000 for a consultation of less than an hour or $650 to draw blood, it is not hard to understand why New Jersey consumers are paying such high health insurance premiums. Horizon members alone pay more than $1 billion a year in out-of-network costs," he said.

And that bill, he said, goes deeper than just one charge.

"The out-of-network cost issue is a consumer protection issue," he said. "New Jersey residents will continue to pay higher health care costs unless common sense changes are made."

The coalition contended that some health care providers have been "squeezed out" of insurance networks because they were unable to agree on in-network reimbursement rates.

"Physicians' and hospitals' only recourse to negotiate adequate payment rates is to have the ability to walk away from the table and go out of network with the insurer," the coalition said in a statement.

Nell Eicher, vice president of government relations for the New Jersey Hospital Association, said the coalition is opposed to out-of-network rate caps and that it is working with legislators to arrive at a compromise.

"We want to be part of the solution, which should be a shared response by providers and insurers," he said.

"We think if you make the in-network situation better for (health care) providers it gets rid of the out- of-network problem."

Eicher said the issue is simple.

"(Providers are seeking) better reimbursements and a better in-network experience," he said.

The issue is headed to the legislature.

A group of politicians, led by Assemblyman Craig Coughlin (D-Woodbridge) and Sen. Joseph Vitale (D-Woodbridge), have been meeting for weeks with health care stakeholders.

They have said they expect to introduce a bill addressing out-of-network medical bills within the next few weeks.

Lawrence Downs, chief executive of the Medical Society of New Jersey, said the inability to come to terms with insurers forces a number of doctors to remain out of network.

Downs pushes the issue to Horizon.

"(Horizon) has the ability to contract with all physicians and hospitals in the state, but they choose not to," he said.

Horizon's Vincz disagrees.

"More than 85 percent of physicians, and a majority of acute care hospitals, are in the Horizon networks - the state's largest networks," he said. "So this is not an issue of access.

"This is an issue of excessive charges by those doctors who choose to go out-ofnetwork to increase their profits."

The members

The NJ Access to Care Coalition members include:

* New Jersey Hospital Association

* Medical Society of New Jersey

* Radiological Society of New Jersey

* New Jersey Association of Osteopathic Physicians and Surgeons

* New Jersey Podiatric Medical Society

* New Jersey Society of Pathologists

* New Jersey Neurosurgical Society

* New Jersey Academy of Family Physicians

* New Jersey Orthopedic Society

* New Jersey Society of Plastic Surgeons

* New Jersey Association of Ambulatory Surgery Centers

* NJ Society of Interventional Pain Physicians

E-mail to: beth@njbiz.com

On Twitter: @bethfitzgerald8