Independent medical providers fight insurance, Medicaid over reimbursement [Dayton Daily News, Ohio]

Apr. 17--When Dr. Laura Valle, a certified nurse midwife and menopause practitioner, opened her practice in May 2022, she had done so with the hopes of giving her patients the time and care she provided when practicing previously in Europe.

By accepting commercial health insurance and Medicaid plans, though, she found she was barely able to break even on her operating costs month-to-month given the administrative hassles and reimbursement levels.

Valle was not able to take a salary for herself and was only able to pay herself one time in 2023 in the amount of $400.

"As a single mom, that's just not something that's sustainable, and for anybody, I'm sure no one wants to work for nothing," said Valle, owner of Willow Women's Health in Kettering.

It's an experience felt by many health providers and doctors, the Montgomery County Medical Society says, including medical providers who have independent practices or work as part of a larger health or hospital system.

Independent providers often get the short end of the stick, said Dr. John Corker, president of the Montgomery County Medical Society, a voluntary membership organization for physicians in Montgomery County and the contiguous surrounding counties.

"Obtaining payment from insurers, whether that's government insurers -- Medicaid, Medicare -- or private insurers ... It's a challenge for everybody. It's especially a challenge for independent physicians," Corker said.

Challenges in prices

For the government payors, there's a price differential for doctors who provide services in an outpatient setting versus at a hospital. Hospitals can charge an additional facility fee, even if the independent provider is providing the same care, just in a different setting, according to the Montgomery County Medical Society.

Under contract negotiations, commercial insurers may pay higher reimbursements to larger groups, such as large hospital systems, because of their market share, Corker said.

"Insurance companies want access to all those patients or all these doctors who are incorporated under a hospital system under an employment model," Corker said.

For Valle, she often did not get reimbursed for all of the care she provided, she said.

"My typical bill would go out around $400, and then what would come back to me on average was about $75 to $100," Valle said.

Medicaid challenges

State legislators did approve payment increases for Ohio Medicaid for its fee-for-service pay schedule in the last state budget, and those increases went into effect in January. Most Medicaid members are under a managed care plan, though, which do not have to implement those increases.

Ohio Medicaid estimates the increases in the professional fee schedule for non-institutional providers meaning health care providers outside of a hospital or long-term care facility will result in $415 million in new funding in the next year. Specifically, most codes will be increased by 5% or more, according to the Ohio State Medical Association.

The Ohio State Medical Association recommends health care providers review their contracts with managed care organizations to see if the rate the provider is being paid is linked to the fee-for-service Medicaid fee schedule.

For state fiscal year 2023, Ohio spent approximately $36.1 billion, including both state and federal funds, on the Medicaid program as a whole. Of that, $24.6 billion went to managed care. Ohio Medicaid's fee-for-service costs were approximately $5.1 billion, not including costs to the Department of Developmental Disabilities.

Most Ohioans who receive Medicaid services do so through a managed care provider, which receives a monthly payment from the state for each enrolled recipient.

Ohio Medicaid did not respond to a request for comment.

Streamlining reimbursement

Ohio's health plans are working with providers and hospital systems to streamline reimbursement processes, said a statewide trade association representing health plans, like those offered by managed care providers and other insurance companies.

"The reimbursement process is determined by contracts between each provider and plan, so it varies from one to the next," said Kelly O'Reilly, president and CEO of Ohio Association of Health Plans.

Administrative challenges can delay providers receiving reimbursements, O'Reilly said, such as a lack of complete and accurate data on the claim.

"Once the data is correct and complete, Ohio's prompt pay rules require commercial plans to pay or deny a clean claim within 30 days and Medicaid plans to pay or deny within 21 days. Data from the plans indicates that these timelines are being met and often exceeded," O'Reilly said.

Ohio's health plans are hopeful that by working with providers on more use of electronic data sharing, reimbursement processes can become faster and more streamlined, O'Reilly said.

"This permits providers to spend less time on administrative paperwork and more time on patient care, which is in everyone's best interests," O'Reilly said.

Prior authorization

Prior authorization which requires doctors get permission from insurance companies first before the insurer agrees to cover certain procedures or medications can lead to delayed or abandoned care, according to the American Medical Association.

More than nine in 10 physicians (94%) report care delays while waiting for insurers to authorize necessary care, and 80% say prior authorization can lead to treatment abandonment, the association says.

One-third (33%) of physicians say prior authorization has led to a serious adverse event, including hospitalization (25%) or disability or even death (9%) for a patient in their care, according to the association.

Doctors and their staff, on average, spend two days a week submitting prior authorizations, according to the American Medical Association.

Ohio Medicaid provides a list of inpatient hospital procedures that require prior authorization that follow the guidelines of the Ohio Administrative Code. The list includes approximately 300 codes for specific procedures that are normally covered but required prior authorization, as well as more than 2,000 codes for procedures that are not normally covered and require prior authorization.

Procedures that are not normally covered fall under being considered cosmetic or experimental, according to Ohio Administrative Code.

Automatic denials on certain claims

The Montgomery County Medical Society has seen insurance companies automatically denying claims if certain diagnoses, which correspond to certain codes in the billing process, are on the patient's chart, such as following a visit to the emergency room.

Providers can go through appeals and arbitration processes, but the payment for that service could be delayed six months, sometimes as much as a year, Corker said.

"Independent physicians can't wait that long," he said.

There is already a "prudent layperson" statute in the Ohio Revised Code saying insurers cannot deny claims if a person is reasonably seeking emergency care.

Under Ohio's current general assembly, H.B. 99 also seeks to highlight and reinforce that standard, prohibiting health insurers from reducing or denying claims for emergency services solely based on a diagnosis code or impression. H.B. 99 has been in the House Insurance Committee for more than a year.

"It is not a new standard. It is in statute, but it's not being followed," Corker said.

Keeping the doors open

More doctors are selling their practices to larger health or hospital systems, in which they can take a salary from that health system, outsourcing the hassles of getting reimbursements from insurers, Corker said.

It was 30 years ago that 70-80% of all physicians were independent, he said, and now it's less than half.

Doctors seeking employment with a larger health system isn't a bad thing, he said, but it can lead to fewer options for patients.

By selling a practice to a larger system, the doctor could become out-of-network for some of their patients, leading to the patients having to go elsewhere.

Other times, doctors and health providers have had to go to private-pay only, not accepting commercial insurance or goverment payors, like Medicaid managed care organizations.

"The physician has to do what they need to do to keep the doors open and to provide care," Corker said.

Going to private pay

Valle, a nurse practitioner, was faced with that same decision of whether or not she should go to private-pay only for her practice.

"The only other solution would be to close my practice, and then I'm not helping anybody," Valle said.

Valle wanted to give her patients more time during appointments, but to make a profit under insurance, she said she would have had to limit patient visits to 15-20 minutes each.

Since going to private-pay only and no longer accepting insurance, with the exception of Medicare, she has been able to take a salary and keep running her practice.

Valle's patients who were able to continue going to her have been able to use HSA or FSA cards or put her visits toward their deductibles.

"What I felt really conflicted about was the fact that I would no longer be able to provide care to my Medicaid patients, and it's not their fault that Medicaid pays so poorly," Valley said.

Health providers cannot charge Medicaid patients cash or private-pay for services covered under Medicaid, she said, so those patients had to go elsewhere.

"That's my biggest dilemma, and I don't have all the answers," Valle said. "I don't know what the solution is, but I know our system does not work well."

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