This week, the American Medical Association released its annual Health Insurance Report Card for 2013. This report provides metrics on the timeliness, transparency and accuracy of claims processing of the nation’s eight largest payers: Aetna, Anthem, Cigna, HCSC (owns BlueCross BlueShield plans), Humana, Regence, United Healthcare and Medicare. Overall, the AMA’s reaction to the report was that insurance companies are processing claims faster and more accurately than they were several years ago. Also, fewer claims are being denied today than they were several years ago. But keep in mind that these observations of claims processing improvements are being made by the providers and the insurers.
If you look deeper into the report, you will see that the report card data also shows that approximately 25% of all claims processed end up being patient responsibility. These claims are then counted in the timely and accurate claims calculations. Problem is, while the health plan may have processed these claims timely, they didn’t necessarily do so accurately. Let’s look at two recent examples where the health plan and the provider thought the claim was processed accurately:
Two weeks ago I received the bill from my daughter’s visit to her allergist. The bill said that patient responsibility after my health plan processed and paid the claim was $3,900. I thought this was outrageous. I took a closer look at the bill and saw that the charge for the doctor’s “initial consultation” was $13,500. My health plan apparently didn’t question the doctor’s charge for this initial visit and they processed and paid the claim, applying $3,900 of their $8,000 allowed amount to my deductible. The doctor’s office didn’t question it either before sending me the bill. I did contact the doctor’s office and get the matter fixed. But both my doctor’s office and my health plan made a mistake and it was up to me to find the mistake and fix it.
Another recent example happened to one of our clients, Sheila. Sheila’s daughter was taken the ER and then admitted to the hospital for eight days. Sheila received a bill from the hospital stating she owed $1,050 after her health plan paid. Luckily Sheila verified what she owed before she sent a check to the hospital. It turned out that her health plan made an error in calculating her copay amount. She was being charged an ER copay of $250 plus an inpatient copay of $200 per day. The fine print in her summary of benefits stated that if a patient is admitted to the hospital from the ER, there is no ER copay due. Again, the health plan made a mistake in processing the claim and the hospital billed her the incorrect amount. It was up to Sheila to find the mistake and fix it.
There are many other examples out there where claims are denied for pre-existing conditions, non-covered services, not medically necessary, etc., and the charges are being held as patient responsibility. Unfortunately, the AMA’s health plan report card does not analyze the error rate of claims held to be patient responsibility.