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Paul Zimmerman
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Federal Government Sued Over Emergency Physician Reimbursement Policy

Emergency physicians have long alleged that health insurance companies are unfairly and inconsistently setting low out-of-network reimbursements for emergency care, and now they are imploring the federal government to do something about it. According to a complaint recently filed in federal court, an Affordable Care Act regulation related to emergency-care reimbursement fails to ensure reasonable payment to out-of-network providers. The case is American College Of Emergency Physicians v. Burwell et al. (case number 1:16-cv-00913), in the U.S. District Court for the District of Columbia. The American College of Emergency Physicians (ACEP) is targeting a final rule issued jointly in November in 2015 by the U.S. Department of Health and Human Services, the Department of Labor and the Department of the Treasury.

Emergency room physicians are more likely to treat out-of-network patients because the Emergency Medical Treatment and Labor Act requires that they care for any individual who enters the emergency room regardless of their ability to pay. To balance this mandate, the Affordable Care Act requires transparency of data and fair repayment methods for out-of-network emergency care.

The 2015 rule created a standard under which insurance plans must give out-of-network emergency-care providers the greatest of three payments: the plan’s in-network amount, the Medicare amount or the so-called usual, customary and reasonable amount, known as the UCR. The lawsuit demands that insurers be transparent regarding the specific data they are using to pay for emergency services rendered by an out-of-network provider. They also want the federal court to clarify the "usual and customary" standard.

The complaint states that the UCR is normally the largest of the three amounts, but that it is unreliable and subject to manipulation by insurance plans. Jeff Bettinger, chair of the ACEP/Emergency Department Practice Management Association's work group on out-of-network and balance billing issues, says that "allowing insurance companies to use opaque payment methodologies for out-of-network services not only lowers reimbursement for emergency services but transfers massive amounts of financial liability to patients."

 ACEP contends that health insurers are “forcing many providers out of their networks by imposing ridiculously low rates of reimbursement. In addition, health insurance companies are misleading patients by offering so-called 'affordable' premiums for these policies that cover very little because of the narrow networks, high co-pays and astronomical deductibles. It is insurance in name only because there is hardly any real coverage for the patient."

ACEP adds that “the viability of the practice of emergency medicine is at risk because many physicians will have no choice but to leave the practice of emergency medicine if they cannot receive fair payment for out-of-network services.”

This lawsuit will be of great interest to emergency physicians, as it may provide much needed clarity regarding both the federal definition of UCR and the level of data transparency required under the law. M&R will follow the case closely, offering updates as issues develop.

This blog post is not offered as, and should not be relied on as, legal advice. You should consult an attorney for advice in specific situations.