When Patients are Blind-Sided by Phantom Providers

By Maggie Mahar

Regular reader, author (108 Days), and patient advocate Lisa Lindell recently sent me a story that aired on her CBS television affiliate in Houston. It’s a tale I have heard before, but what is shocking is that no one has managed to find a solution to such a patently unfair wrinkle in our health care system.” Even strongman California Governor Arnold Schwarzenegger has not been able to the break the deadlock between doctors and insurers over whether surgeons have a right to charge $2,000 to $3,000 an hour—and whether the patient should be stuck with a bill that the insurer won’t pay.

Briefly, here’s the story that Lisa sent from Houston: Last October, Rania ElShenawys suffered a bad reaction to medicine she was taking and went to a
Memorial Hermann Hospital emergency room.  ElShenawys was treated and her insurer paid the hospital bill. That should have been the end of the matter.

But months later, she received a bill for $425. It turns out that while Memorial Hermann Hospital was in her insurance plan’s network, the doctor covering the ER that day wasn’t. Thus her insurer wouldn’t pay his full bill.

Some blame the insurer: “To tell a patient you can go to XY hospital and you’re covered is not truth,” Texas Medical Association spokesman Dr. Michael Speer told Houston’s Channel 11. “It’s little truth.”

“Doctors say insurance companies save money by having inadequate network coverage, particularly for certain specialties,” Channel 11 reported. “As a demonstration, Dr. Speer went thru United Healthcare’s Web site, searching for covered pathologists at local hospitals. ‘Only one pathologist is in that network’s plan,’” he reported.

On the other side of the controversy, “Insurance companies argue some doctors try to hold them hostage for exorbitant payments,” Channel 11 reported. If insurers won’t agree to meet the doctors’ demands physicians simply refuse to join any network. Either way, “it’s not unusual for you to go to your covered hospital and see a doctor who’s not.”

Rania’s case was still unresolved when her husband went to his in-network primary care doctor with a serious infection. His doctor insisted that he go to the ER. This time, the computer programmer specifically told Memorial Hermann that he wanted to see an in-network physician.

Nevertheless, he wound up with a $611 bill. It seems that, once again, the ER doctor wasn’t in his plan’s network. The Texas Hospital Association acknowledges that even if you’re smart enough to ask for in-network doctors, it may not happen.   

“There is room for improvement,” the Hospital Association admitted to Channel 11. “The problem? Everything from administrative hassle to a lack of covered doctors.”

TV Station Arbitrates Dispute

Mr. ElShenawy was livid. Ultimately the family went to Channel 11. and the CBS affiliate persuaded the insurer, Principal Financial, to pay the bill.

This is not the way that disputes in our medical system are supposed to be adjudicated. State lawmakers and the State Insurance Department say that they are working on the problem. But this isn’t a state problem, it’s a national problem. And it’s not new.

In New York. . . Surprise, You Owe $15,000

Three years ago the Wall Street Journal told the story of what happened to Tom DiBari and his wife when they took their infant son, Jackson, for heart surgery at Morgan Stanley Children's Hospital of NewYork-Presbyterian,,

The DiBari’s had made sure that both the hospital and the surgeon were in their insurance company's network. Nevertheless, after the surgery was completed they were hit with a bill for nearly $15,000.

It turns out that during Jackson's eight-hour surgery, a second surgeon was brought in to assist who wasn't part of the Aetna network that covered the family. The DeBaris were charged for almost all of that second surgeon's $15,000 bill. Aetna agreed to pay just 10%.

“This issue occurs at many hospitals, and with many insurers,” the Journal reported. “Often, the out-of-network physician is somebody such as an anesthesiologist or radiologist, who helps with the patient care, but isn’t the main doctor in charge.” Patients are blindsided with a bill from someone they never saw.

What if you are in a car accident in another state, where there are no in-network physicians nearby? In an emergency, insurers often will provide in-network benefits provided by out-of-network doctors, though sometimes patients have to battle insurers to get that coverage -- making the case that their situation was an emergency. And for non-emergency care performed by out-of-network doctors, insurers generally leave more of the bill to the patient.

The Journal quoted the National Association of Insurance Commissioner: “On the whole, there are not a lot of regulations that protect patients in these circumstances. More than 40 states require insurers to pay benefits for emergency care, regardless of network affiliation, according to the association, but how much can vary. Far fewer states have comprehensive regulations that also address non-emergency care.”

"It's not uncommon" for patients to receive out-of-network care in in-network hospitals,” says Gordon Grundy, Aetna's regional medical director for the Northeast. "Technically speaking, it's important for members to understand this aspect of their health plan."

In other words, patients need to “understand” that anytime they are admitted to a hospital, they’ve enrolled in a lottery. It’s all a matter of chance as to whether they will be treated by an in-network doctor, or billed thousands of dollars by someone they have never met.

In both of these cases, the patient did everything right. Mr. ElShenawy went to his in-network primary care doctor who then referred him to the ER of his in-network hospital. When he got there he made it clear that he wanted to see an ER physician who was also in his insurer’s network. (This is documented.)

As for Mr. DiBari, he was aware that it was possible that his son’s surgeon would wind up needing an assistant. Well before the surgery took place, he requested that if a second surgeon was needed, that it be someone in Aetna's network. He was told there could be no guarantee. “The hospital tries to accommodate such requests,” says spokeswoman Myrna Manners, but "when you're dealing with delicate surgery, you have a limit to the number of people who might be available to do what needs to be done."

This is hard to believe. DiBari’s son was being operated on in one of Manhattan most prestigious hospitals—a medical center that specializes in pediatric care. Aetna’s network of doctors in New York is large. It seems incredible that neither the hospital nor the primary surgeon could line up a potential assistant from Aetna’s network. Most likely, no one tried very hard.

Who Is To Blame?

Shouldn’t hospitals insist that doctors who practice on their premises join their network?

Hospitals don’t control the insurance networks that doctors with privileges at their facility join. "We make every effort, but the problem is that we can't make them sign what they don't think is a reasonable contract," says Jeff Casey, vice president of finance for FirstHealth of the Carolinas, a system of three hospitals in North Carolina. And hospitals will not revoke the out-of-network doctor’s privileges. If they did, the physician would simply take his patients elsewhere. (This is yet another example of how patients can wind up the losers when physicians are free agents, and don’t see themselves as part of a hospital’s team.)

Casey makes it clear that if doctors think they can charge more than local insurers usually pay, some will. They’ll simply refuse to join a network and charge as much as the market will bear. And when it comes to heart surgery for infants, and the “market” is composed of those childrens’ parents, there is virtually no limit to what the market will bear.

When Mr. DiBari was told that there was “no guarantee” that the second surgeon would be covered by Aetna, he was not going to cancel that surgery. Even if the price was made “transparent.” and he was told that he might owe as much as $15,000, he would not have postponed an operation that his son needed. What if he “shopped around” and found a young surgeon who would assist for $12,000? Would he really want a “discount doctor” to cut into his son’s tiny heart? Once again, we see how, when it comes to the priciest health care, free market competition doesn’t work. The customer has too little power.

Was the out-of-network assistant who billed $15,000 to assist in the surgery charging too much? Or was Aetna paying surgeons too little and, as a result, there really was a dearth of surgeons capable of assisting with this surgery in Aetna’s New York network?

I have no way of knowing. Though given the fact that the surgery lasted eight hours, and the second surgeon came to the operating room sometime after it began, it seems that he was charging roughly $3,000 an hour (assuming he assisted during the final five hours.) This seems a bit  steep.

But whether or not his fee was excessive, there is no reason why the patient should be stuck with the bill. The DiBari’s had purchased comprehensive insurance, paid their premiums, and did their best to stay in-network.

State or federal insurance regulators should be involved in negotiating fees that insurers will pay and that doctors will accept. We cannot afford to have a system where every physician sets his own fees, and patients are forced to pay them without having any choice of doctors.

Phantom Providers

Frequently patients receive bills from doctors they never even saw, says Cindy J. Holtzman, Director of Operations at Medical Billing Advocates of America (MBAA).

“A patient really has no idea who will look at any x-rays, initiate anesthesia, biopsy a specimen, or be the emergency room physician on call that day. In many instances physicians are not in any network at all,” she explains. They could “be called ‘Phantom Providers.’ You never meet them or know them, until you get the bill from a radiologist, an anesthesiologist, a pathologist or an ER doctor.
If you do receive a bill from these providers,” Holtzman suggests, “try to negotiate a discount from them."

Schwarzenegger Stymied

For two years, Gov. Arnold Schwarzenegger’s administration tried to negotiate a compromise between insurers and out-of-network doctors over the crux of the issue: how much the doctors should be paid. Finally, in April, the Governor’s office announced that it was throwing in the towel, and was drafting regulations that simply prohibit hospitals and hospital-based out-of-network physicians from billing a patient when they believe that the amount the insurer is paying them is too little.

Typically, insurers will pay a portion of the out-of-network physician’s bill, but they won’t pay as much as they would pay a physician who is in their network. “Insurers say that paying doctors and hospitals more than they pay their own providers would disrupt the managed care system, because it would create a disincentive for providers to sign contracts with HMOs,” the Los Angeles Times explains.

California’s Department of Managed Health Care had tried to find common ground between doctors and insurers. "We tried to say, when we were young and naive, that we could find a mutually acceptable resolution to make sure physicians were being paid fairly and on time," said Cindy Ehnes, the department's director. "We finally said, we can't solve this marketplace dispute, but what we can do is our core mission of protecting consumers."

According to the L.A. Times, “Today many patients wrongly assume that the extra bill is the invoice for their co-payment and is authorized by their HMO.” As a result, “thousands of Californians have been paying these bills.”

“Consumers who do the right thing and go to a hospital that's in their network should not be leveraged in a fight between doctors and insurers," Beth Capell, a lobbyist for Health Access California, a patient advocacy group, told the newspaper. "It's just wrong."

The draft regulations are now part of a bill pending in the state assembly.

California’s main doctors' lobby has threatened that “if the new rules are approved they could backfire by causing physicians to send the entire bill to patients to let them haggle with insurers for repayment,” the Times reports.

"This is a total giveaway to the HMOs," Francisco Silva, general counsel for the California Medical Assn told the newspaper. He added that specialists will be less inclined to be on call for emergencies.

The bill that the legislature is considering (SB 981) would not only ban billing the patient. It would require HMOS to give doctors an interim payment and establish a method for resolving disputes, something that is now done in Delaware and Florida.

Just eight states regulate billing by out-of-network doctors. New Jersey and West Virginia require HMOs to pay the doctors' bills. Maryland has a formula to determine what the reimbursement rate should be. Connecticut, Colorado and Rhode Island indemnify patients against having to pay these bills.

Yet again, it seems clear that the laissez-faire chaos that we call a health care system needs more regulation to shield patients in every state from becoming the innocent victims of a financial feud between insurers and physicians.

 

 

Comments

[HCBerkowitz]

Jenga's comments are well taken. I'll add, that especially in emergency medicine, the actual actions taken will not depend on a radiologist reading an image or a cardiologist reading an ECG. With routine priority, they may not even look at them until hours or days after the patient has left the ER.

Often, I see two levels of "quality control". One is within the department, and makes a little more sense for radiology than cardiology. A low-probability-of-significance is nore likely to be picked up on imaging than on ECG, but there's probably also a higher probability of picking up an artifact with no significance. In trauma at least, the term VOMIT is applied to Victims Of Modern Imaging Technology, who have treatment of their films rather of their bodies. Another is defensive medicine.

Unfortunately, I don't have the citation immediately to hand, but there was a retrospective study that indicated that plain skull films, in the absence of neurologic symptoms, had not ever produced useful information following a motor vehicle accident where the head might have been struck. CT did find a few things, but X-ray did not. Yet, there's a sense CT is too expensive for 100% use, and the additional radioactivity administered by a CT carries risk.

Yet, AFAIK, I know ER physicians that still order skull X-rays.

In an appointment a few days ago, before I saw the cardiologist in person, an ECG was taken "because it's standard". I have a pacemaker, so a regular ECG doesn't show that much if the device is pacing. Echo plus a 12-lead is more informative, but I had (justified) echo plus 3-lead a few days before. There was some minimal information on this ECG, as I was pleased that this new cardiologist discussed it in detain when he realized I understood. Still, we agreed that it was only suggestive and additional, more invasive tests were needed.

There are a lot of tests ordered, not by a physician thinking about the specific patient, but because it is office or staff protocol. I also was surprised to see a long list of routine drugs, which I had never taken, during a hospital administration. It turns out there are "standing orders" for certain drugs to be available on patient request after certain procedures, but the way the drug billing and handling works, the pharmacy dispenses and bills them and will not take a return. The drugs, incidentally, are stable and sealed in unit dose containers.

[jenga]

I know you have put some time into it that comment was misplaced, as far as the duplication of services a huge part of it is tort issues which had yet to be mentioned. That and there is no disincentive not to. What is the exact incentive for an orthopod not to have every Xray reread by a radiologist? That is what is expected and done now, but has extremely minimal benfit with a large cost. I look at more extremity Xrays every day than a radiologist does. I know what is clinically important and what is not and I have the benefit of a clinical exam to boot. The logical way would be to have the provider tag which ones he wanted overread. That would eliminate alot of waste, however there aren't many things in our system set up for commonsense. This is another one of those. The doctor doesn't pay for it and he doesn't mind having another opinion and oversight on every single image because there is no reason not to in our system.

[Barry Carol]

“The problem with talking about malpractice when talking about health care costs is that there is no way to get your arms around how much it costs. We know that all of the settlements and awards add up to just under 1/2 percent of heatlh care spending.

But we also know that the real cost comes in defensive medicine. Here, I don't know what to say. Some doctors might say "I know that half of what I do is because I'm afaid of being sued." Others say "fear of malpractice probably effects me a little bit--but not that much.

This obviously varies by specialty--if you're an OB/GYN delivering babies, you're much more worried.

But it's all hugely subjective, so I see no point in simply trying to guess what it might cost.”

Maggie,

This is a critically important point. Our inability to precisely measure the impact of important issues while we overly emphasize what we can measure can lead to significant policy mistakes.

With respect to malpractice, single payer advocates, for example, claim it’s not an important issue because the cost of malpractice premiums and court awards (which they can measure) amount to less than 1% of healthcare costs while they conveniently ignore the much more significant effect of defensive medicine because they can’t measure it. Finding a more sensible approach to medical dispute resolution that treats both victims and doctors fairly is an important but separate issue from whether or not defensive medicine is an important driver of healthcare costs in the U.S. vs. elsewhere.

By the same token, they zero in on insurance company administrative costs as a significant source of savings as compared to Medicare’s administrative costs because we can measure those, though, even here, there is room for argument as to what constitutes administrative expenses (disease management costs, premium taxes, etc.). On the other hand, the cost of fraud for both Medicare and Medicaid, which some observers estimate could be as high as 10% of outlays, is ignored or downplayed because nobody can measure it precisely. Even Dr. Emanuel in his book mentions fraud costs, partly attributable to inadequate oversight by CMS, as a key weakness of a single payer approach.

Life expectancy, which we can measure quite well, is affected by many factors that have nothing to do with the quality of the healthcare system or whether one has insurance and can easily access healthcare or not. Personal choices like diet, exercise, smoking, etc., genetics, violence, car accidents, socio-economic status all probably have more impact on life expectancy than the healthcare one receives or doesn’t receive, but we point to life expectancy differences among countries as an important indicator of quality.

We can also measure infant mortality, but there are significant differences in how various countries define a live birth which can skew the numbers. Socio-economic status is also an important issue here even if one has decent access to appropriate healthcare.

The bottom line is that just as the doctors say about the limitations of P4P, we can’t let our inability to precisely measure the effect of important issues like defensive medicine and fraud lead us to make bad policy choices because we choose to focus on what we can measure and ignore or downplay what we can’t measure.

[maggiemahar]

Jenga--

Hey--that's really not fair. It's not that I don't want to talk about malpracice.
I recently wrote a long two-part post on malpractice--trying to nail down the facts, the myths and a solution that some hospitals are trying which really seems promising. It could eliminate a lot of suits.

Since I spent roughly 20 hours on it,
I hope you'll read it before writing me off on the issue.

Here's part 1: http://www.healthbeatblog.org/2008/05/medical-malpr-1.html

and Here's part 2: http://64.233.169.104/search?q=cache:L36wF7vPNa4J:www.healthbeatblog.org/2008/05/medical-malprac.html+malpractice&hl=en&ct=clnk&cd=1&gl=us

The problem with talking about malpractice when talking about health care costs is that there is no way to get your arms around how much it costs. We know that all of the settlements and awards add up to just under 1/2 percent of heatlh care spending.

But we also know that the real cost comes in defensive medicine. Here, I don't know what to say. Some doctors might say "I know that half of what I do is because I'm afaid of being sued." Others say "fear of malpractice probably effects me a little bit--but not that much.

This obviously varies by specialty--if you're an OB/GYN delivering babies, you're much more worried.

But it's all hugely subjective, so I see no point in simply trying to guess what it might cost.

What is worthwhile is figuring out an equitable way to a)reduce the number of nuisance suits and b) settle legitimate suits without spending a fortune --or burying the doctor who made a mistake. At the same time, the patient and family who became the victim of the mistake need to be compensated.

MOre importantly, we need to put more systems in place to make human error less likely.

[jenga]

Don't forget the Tort reasons for the reciprocity. Sorry, I forgot, that is taboo to talk about when talking about cost and healthcare reform.
These aren't the droids your looking for. Move along.

[maggiemahar]

Howard--
Thanks for the comment.
I can imagine that some of what seems redundant is "perhaps well-meant quality control procedure."
But probably someone needs to take a close look to see whether errors are indeed being avoided. . .

[HCBerkowitz]

There are some things to check as possible reasons for "phantom physicians", especially for diagnostic studies. On a professional trauma and critical care, the practitioners routinely do the first readings in emergent situations, with the caveat that a radiologist is needed for invasive procedures such as angiography.

I would not be at all surprised to find that JCAHO, or a specialty board, requires radiologist or cardiologist or other diagnostic specialist review, not to provide any direct improvement for patient care, but as a perhaps well-meant quality control procedure as part of accrediting the service.

In clinical pathology, the methods of quality control are much more straightforward than in, say, radiology. When you run most semi-automated tests, high, low, and normal synthetic controls automatically are included in the batch. It is also quite common for a lab supervisor or director to take a sample arriving in the lab, split it into two parts, give an appropriate ID to the second -- and the results on the two halves had better match.

It's much harder to have controls in medical imaging. Still, if that is a goal, one option may be to send a digitized package of imagery to departments, have their staff review them, and still get consistency. That doesn't address technicial skill or equipment issues.

From my own experience, there's a constant conflict between best practices in software engineering and FDA device approval. FDA approves based on a particular software configuration, including operating system. Unfortunately, good software engineering means that vendor patches are promptly applied, so the software configurations for FDA and clinical engineering don't tend to be the same.

[maggiemahar]

Chris and Gary L.--
thanks for your comments.

Chris-- You make a very interesting point. It seems to me that there should be a box for you to check if you don't need a radiologist to read the image --and the patient should not be billed.

If more doctors were cost-conscious about redundant treatments, this would really health make the system more affordable. This is one reason why I think doctors should be in the vanguard of reform--they know, better than anyone else, where the waste is, and what services really are needed.

Gary L.

As I said in the post, I'm not in a position to know whether $16,000 was an excessive amount for the surgeon who assisted for five to seven hours to charge.

I realize that doctors have overhead. But since the surgery was done at an academic medical center (New York Presbyterian), it's very likely that the surgeon was an assitant professor there.

If so, his malpractice insurance is paid by the medical, center and the center provides him with an office, etc.

But of course he might be in private practice.

As for "global services" it's probably unlikely that a surgeon who assited did follow-up care.

It's clear that the DiBari's never met him before the surgery and the few times my husband has had surgery, he never met the surgeon who "assisted" either before or after the surgery.

Also, I realize that hospitals adjust their bills to offset the fact that the insurer may well pay less than it actually cost ot provide the service--or only a little more.

But in this case, the surgeon wasn't billing an insurer; he billed the family directly, and made it clear that he expected the whole $15,000.

This is the problem for patients when out-of-network doctors bill them; they charge them the "list" price, without discount--in other words, they charge them more than they would charge an insurer, if they were in a network . . .

I realize that insurers sometimes underpay for certain services. Somebody needs to arbitrate charges for services . . .

since most private insurers follow Medicare's fee schedule fairly closely, it's all the more important for an unbiased panel --perhaps a panel of doctors who work on salary rather than fee-for-service-- to take a close look at Medicare's fee schedule, making adjustments where Medicare is underpaying, AND where it is overpaying for certain services.

[Chris Johnson]

I have a small point to add to this very interesting discussion: do we get good value for the charges these phantom physicians add to the patients' bills? I wish there was a check-box on several of the tests I order, such as x-rays and electrocardiograms, to indicate if I want one of these phantom physicians to interpret the result and bill my patient. Here is an example what I mean. Like most intensivists, I order a lot of chest x-rays. Many of these are for verifying the locations of endotracheal tubes and central venous catheters I have just placed. I look at the images and adjust the tubes and lines as needed. I don't need a radiologist to help me do this. Yet the next day I get a printed report from the radiologist that presumably results in a needless charge to the patient. I have no way to order a chest x-ray and state that it should not be read by a radiologist. I suspect other specialists are often in the same situation--there are times we neither need nor want one of these phantom docs to help us. Another example might be an orthopedic surgeon who has just reduced a fracture and wants an x-ray to verify this--he or she doesn't need the help and the patient doesn't need a radiologist's bill.

[Gary L]

Several comments regarding this post and other comments

1. Surgeons do not charge 2-3000 dollars per hour. Their charges are for global services which can include all postoperative visits for 90 days. It is not all "fat" and exorbitant charges.
It includes overhead paid directly by the MD for malpractice, office rent, emmployee salaries,utilities, practice management systems,billing personell. It is said that physicians overhead for billing is 15% of gross charges. Also covered by the fees are medical education courses, required by state boards,medical licensure fees, DEA fees,society dues. accountng charges, attorney charges, etc.
HMOs do not manage care, they manage payments to providers and set up barriers for patient access to providers and specialists.\
If you want real transparency, do this when you are discharged from a hospital. Ask for a detailed itemized statement from the hospital, and then find out how much the HMO paid.
Hospitals use an offset system to bill more than the usual amount to offset the miserable payments they received from both HMOS and medicare.
Let's firmly place the blame on the right organizations.
Providers and hospitals are often backed into a corner into near insolvency by payors.

[maggiemahar]

Bingo--

When you describe the amenities that doctors should provide to paitents:

"staff presentable and dressed appropriately, trained to respond to patients as if they are visiting a high-end consumer service business"
, I hear "high-end consumer service business".

From my point of view medicine is not a "business" in the ordinary sense and patients are not "consumers"

In other words you might as well be talking about a high-end /hotel where the people at the front desk are all "dressed appropriately" (This is again code for class and race. I'm sure you don't mean it that way, but if you think about it, I think you might agree. )

I'm very glad you agree about Mayo in Minnesota and the first third of my post--thank you.

And we really can agree to disagree about some things.

[bingo]

Perhaps we will, Maggie, and at some point I will have to succumb to that famous Mark Twain quote about doing battle with someone who buys her ink (bytes?) by the barrell!

Amenities: a freshly decorated office; clean and functional bathrooms; free and fresh coffee (sometimes even Starbucks); staff that is presentable and dressed appropriately, trained to respond to patients as if they are visiting a high-end consumer service business; newer, comfortable furniture; modern lighting; spacious hallways and higher ceilings; currrent periodicals or table books; video, entertainment or educational.

Most of this describes the Manhattan offices you denigrate. Here in the hinterlands it is well-nigh impossible to pre-select for race...cheap shot.

Sensational stories? Take a peek at The Health Care Economist blog and his review of international health care. He provides a rather nice review of the strengths and weaknesses of the systems in place in a number of different countries. There's no perfect system, and resolving a weakness always seems to be accompanied by a consequence. I didn't make this stuff up.

I like the Mayo Clinic, Maggie; I like the way they do business, too. And I liked the first third of your post.

[jenga]

I agree Bingo. A very broad brush for a specific problem. Maggie is quick to discuss her "rights". Physicians have their's to. You do not have the right to their expert opinion at a discount if they have not signed up for a plan. They paid their dues, they paid hundreds of thousands for school, worked for nearly minimimum wage for 4-5 years and after looking at a contract, have decided out of their own free will not to enter into an agreement. I haven't seen Maggie forced to write an editorial for Foxnews or the Weekly Standard at a discounted rate.
Maggie
I've heard this foot Xray story from you two or three times now and I hear it once or twice a week from others. It is a typical occurrence, particularly in a pediatric patient to have a "normal" xray then a repeat one a few days later then have a fracture "show up". That's the typical bone response to a fracture. It resorbs calcium and it becomes more visible after a few days. And I suspect that neither doctor knew this, because number 1 doc should have known that kids often fracture through growth plates that don't show up on xray or will have a fracture that shows up days later like I said earlier or the number 2 doc thought he was being a hero and threw the other one under the bus. "See how good I am, I see a fracture he didn't." In any case was any harm actually done? It is exceedingly rare to ever have to operate or reduce any pediatric fracture particularly in the foot and I suspect that it healed just fine. Kids have been breaking bones in their feet for thousands of years, we just recently been able to show a pretty picture of it or not as the case may be.

[maggiemahar]

Bingo--

Clearly we are going to have to agree to disagree, but let me respond to a couple of your points:

"the amenities that you describe are frankly looked upon by patients out here with gratitude and relief."

The amenities I described in Park Avenue practices are very nicely decorated offices and "caucasians only" in the waiting room. I can't see how either would be looked upon with "gratitude and relief" in the mid-west.
I imagine you were talking about other amenities?

Health care is both a right and a necessitiy. This is why prices should be regulated just as we regulate prices for heat and light--also necessities.

And yes, people have a "right" to the best medical care available, regardless of how much they can afford to pay. Ideally, the sickest people would see the most experienced and talented doctors. (The Mayo Clinic in Rochester, Minn., for instance, takes the most difficult cases when the patient cannot get comparable care in the areas where he lives. And they do a lot of charity care.)

Finally, if you read the medical literature (JAMA, NEJM, Health AFfairs, etc.)
you know that European countries have better health care than we do--better outcomes in many areas, higher patient satisfiaction, higher doctor satisfaction--and we spend 2.4 time as much as they do.

After adjusting for differences in cost-of-living, other professional salaries, etc., U.S. doctors make twice as much as the average doctor in these countries--despite what you seem to consider outrageously stingy fees paid by insurers. (See the second from the last issue of JAMA -an article titled "A Perfect Storm")

When I attended a 3-day world-wide healthcare conference in Berlin early in the spring (attended by thousands of doctors, mostly from Europe), I talked to a great many physicians from different countires..

All said the same thing: they would never want to practice in the U.S. They are well aware that U.S. doctors make more money, but they consider our system unfair to patients, too chaotic, and backward in many ways (lack of electronic medical records; too much money spent on amentiies rather than healthcare IT; too many unncessary tests and procedures, too little evidence-based medicine.)

Despite whatever sensational stories you may have about black markets in Greece and Italy--we all know that healthcare systems in Germany, Switzerland, Sweden, Norway, France, the U.K. etc. do not have a problem with black markets.

As for Italy--My husband's life-long best friend lived in Italy for his entire life. He died there, not too long ago. The family is very wealthy but they were very satisifed with the health care available to everyone in Italy.

. His wife, who has had breast cancer, also had very good care.

They wouldn't consider coming here for treatment, even though they could afford to go anywhere in the world. (They have lived here for periods of time and are well aware of what works in this country--and what doesn't. )

[bingo]

First, apologies for the length of this post (I don't wish to hear Maggie say GYOB!).

Lisa (and Maggie), here's my beef with the original post. Right up until the sub-heading "Who is to Blame" Maggie tells a story and has a tight commentary and narrative, all on point and all directed at the original title of "Phantom Doctors" and the ambush suffered by patients in hospitals when a hospital-based physician in an in-network hospital is not in-network. No beef. I largely agree with the sentiment, agree that it is a problem (having been on the receiving end of it several times), and agree that the lack of transparency is objectionable. I also agree that some form of regulation would be helpful, but as I will consistently hold in this post I categorically disagree with global price controls.

Where the post strays is after the "Who is to Blame" heading where now ALL doctors who bill out-of network are discussed. Doctors with "priveliges at a facility" is an all-inclusive group that includes every doctor on staff, not just doctors who perform in-house tasks like assistant surgeons, radiologists, pathologists and the like. I find it unlikely that this is a throw-away line or distinction, and I therefor call "foul". Tarring the non-hospital based staff member with the same objections that are raised about "Phantom Doctors" is the ambush. The post seques into opinion on ALL out-of-network billing, and trying to find a patient-friendly and physician-friendly solution to that based on one's reactions to a "Phantom Doctor" billing out-of-network for a surgical procedure is intellectually dishonest. It's a broad-brush slam where only a tiny detail brush is necessary.

Maggie I fear that your geography has irreversibly corrupted your view of the provisionn of medical care in the U.S. (Barry, I am an ophthalmologist in a Rust Belt city). I trained in Manhattan and am very conversant with the varying degrees of "custom surroundings" that you reference. It just doesn't scale nationally, though. There is even LESS pricing control in doctors' hands in the hinterlands, and the amenities that you describe are frankly looked upon by patients out here with gratitude and relief. Once again, a broad-brush smear based on a very small sample with limited scalability.

I look at the prices you share in your last comment and what I see are ridiculously low insurance-paid fees for the procedures listed. $100 for an initial neurological consult? Ludicrous. $400 barely begins to cover costs or to compensate for time, training, and experience. $1800 for AAA repair? Are you kidding? That's insulting. I got a quote to paint my house that was roughly 50% of the hourly rate to do AAA at $1800. Do you have ANY idea how difficult that is? How long it takes? What the risks are? No, I look at your list and what I see is the scourge of 3rd party payer hegemony.

Barry in general I agree with most of your last post. A couple of quibbles (why should a sought after doctor be forbidden from giving a volume discount to an insurer who meets the doctor's minimum fee level for instance?)but really nothing more. Maggie, please see my example of the orthopedic surgeons practicing at the base of Vail Mountain or Jackson Hole. The best (best outcomes, most sought-after due to best outcomes) do not accept insurance as payment in full, and yet they are much busier than their competitors across the street who do accept insurance as payment in full. Are you saying that there is a fundamental RIGHT to have your surgery performed by one of the doctors who don't accept insurance payment? That this RIGHT trumps their self-determination? That this constitutes such an aggregious gulf between the so-called "tiers" that you call it "medical apartheid"? Really...medical apartheid? Rather sensational verbiage. To say that using the word here cheapens the term and trivializes what it truly means is the ultimate understatement.

Price caps in Europe? Yup, there sure are, leading to a rather lively black market driven by bribery in such enlightened places as Italy and Greece (see Health Care Economist blog). Wage caps on physicians? You bet, like in Canada a few years ago leading to extended vacations for doctors who had "capped out", some of who were so adept at managing the system that they actually left Canada for months at a time (although I believe from what I hear from my ophthalmic colleagues that this has been relieved somewhat).

There will always be a heirarchy in an arena such as medicine. Someone will always be better, faster, more accurate, more efficient. Someone among this group will always be more congenial, easier on the eye, or more puntual. Who is to determine which among us gets to see these paragons of excellence? Who is to determine which among us gets to have their ACL repaired by the guy at the base of Vail, our LASIK done by Tiger Woods' surgeon, our gall bladder removed by the surgeon who's complication rate is so low she "blows the scale" (as the kids say in school), our shoulder repaired by Dr. Jobs? Who gets to go to the oncologist with the outstanding outcomes who also has an office set up like a spa to calm our anxiety, or the internist who provides copious extra educational information in various formats above and beyond the standard? Who makes that call and with what criteria is that call made? Every doctor won't be the best, but it is the best who drive "good enough" ever upward. (Not all of "the best" choose to practice in your preferred large institutions, drawing a salary and shielding the mediocre.) How will you incentivize them?

These are the questions that your original post opens, Maggie, when you leave the original topic of patients ambushed by non-network doctors in a hospital setting and generalize to all doctors. No, there is no "right" to be treated by any particular doctor or in any particular institution. A couple of anecdotes about greedy surgeons financially ambushing patients doesn't change that, wrong though those surgeons may be. Hourly wage is a false measure: if an orthopedic surgeon can do a joint replacement in 1/3 the time of the average surgeon with the same or better outcomes and he therefore does 3x as many surgeries/hour at the same per surgery fee, is his hourly pay therefore unjustifiable? Hogwash. (Again, this does not excuse the ambush by the assistant surgeon).

It was a great post when it focused narrowly on a single issue, that of saddling patients with a fee for out-of-network physicians in a presumably in-network setting, and how this could be mitigated to both patient and doctor satisfaction.

[Maggie Mahar]

Bingo. Barry and Lisa--

Bingo-- See Lisa's comments.

Let me add that I'm certainly not trying to ambush anyone. The post was focused on bills that patients receive after they have been in the hospital.

In the comments, Barry brought up the issue of whether a) "better" doctors tend to charge more and b)whether doctors' fees should be capped at no more than 20-30% over what Medicare pays for large bills. At that point, he seemed to be talking about all doctors.

In most countries, all doctors' fees are capped or regulated in some way. Medical school also is free. Healthcare is seen as a social good, so society (taxpayers) pay for a doctors' education and they also don't expect doctors to try to gouge them by "charging whatever the market will bear." This seems to me sensible. Anyone smart enough to get into med school can become a doctor. When they graduate they don't have to worry about making a huge fortune to pay off the loans.

In these countries everyone understands that health care is not a commodity. It is not a luxury like an expensive car. It is perfectly fine that some people can afford $60,000 brand new cars and others cannot.

But healthcare is not a luxury; it is a right. Everyone has the same right to the best 8-hour surgery for their child.

And so no one has the right to say: I'm a really good doctor, and your infant will be safer with me. So I'm going to charge you as much as I can. That's called putting a gun to someone's head--i.e. armed robberty.

In fact if you talk to very good doctors (at least in Manhattan) you find that the doctors who don't take insurance and charge the most tend to be the ones who make a huge effort to "network" socially among well-heeled patients and doctors.

When you go into their waiting rooms, everyone is very well-dressed. You rarely see an African-American or Latino patient. They don't take Medicaid patients.

Their offices are very nicely decorated. They pay top dollar for an address on Park Avenue, Central Park West or other "gold coast" real estate even though this is not necessarily convenient for their patients (who may live downtown in SoHo or Tribeca, or on the West Side while their doctor is on the East Side.)

About 50 years ago, Park Avenue would have been the most convenient location for the wealthy. That is no longer the case. But in terms of status, Park Avenue or Central Park West is the place to be. (Traditionally, Park Avenue if you're a WASP, CPW if you're Jewish.)

These locations in no way enhance the health care the doctors provide. But their patients pay more so that the doctor can keep up with the rent.

Finally, as for doctors who don't take insurance and how much more they charge, this price list (below) comes from a 2005 newspaper story about doctors in New Jersey who decide to stop taking insurance. (It's titled "A Sick System")

The number on the right shows what doctors accepted as reimbursement when they took insurance.

The number on the left shows what they are charging now.

In theory, since they no longer have to do insurance paperwork, their overhead is lower and they would pass some of that savings on their patients.

But clearly, they don't. Instead, they're "holding them up"--"if you want to continue seeing me, here's what you have to pay." The mark-ups are exorbitant:

Mastectomy: $5,000 / $900

Ruptured abdominal aneurysm: $8,000 / $1,800

Routine screening mammogram / $350 / $100

Initial neurological consultation / $400 / $100

These doctors are making sure that we have "tiered" medicine in America. Medical apartheid.

Finally, you may remember that I wrote about my friend Tom who was told that he needed a cataract operation--when he didn't.

We both switched to an opthamologist recommended by a Manhattan doctor who reads this blog. (He knows a doctor who sends his family to this opthamologist)

I did some research--very impressive credentials. Then I went to his office: a side street on the Upper West Side. Not at all fancy, but very pratical. Lots and lots of equipment to photograph my optic nerve, check my side vision, measure the thickness of my cornea. (I have glaucoma and dry AMD, so all of this is necessary.)

In the waiting room, a real mix of New Yorkers: black and white, young and old, well-dressed and not so well-dressed. These people did not belong to the same social network. They were there, I suspect, because they had been sent there by another very good doctor.

As for the doctor himself: clearly very intelligent. An academic type (not particularly social, a little shy, meticulous in the examination--taking his time.)

If I need another specialist, I'll ask him for a recommendation. Doctors like this know each other--just as the Park Avenue types know each other.

Barry--You wrote: "any doctor who is so good and so sought after that he or she can sustain a practice without taking insurance, I say good for you."

What I'm trying to say is that "good" and "sought after" are two different things.
When I first moved to Manhattan's upper-west-side I soon discovered that there was a pediatric practice that "everyone" took their children to.
The doctors were relatively young, friendly, and good looking.
It struck me as a bit odd that they flirted with the 30-something mothers. (I'm not implying anything improper--just that it was all very social.)

I also decided that they were not very good doctors. I switched after my daughter broke her foot. The pediatrician recommended a lab down the street to do the x-ray. The Lab was dirty, the doctor was brusque with my daughter and insisted that the x-ray showed her foot was not broken.

A few days later, another x-ray confimred that it was broken.

It turned out that the pediatricians owned the x-ray lab. . . .

[Lisa Lindell]

Bingo, I didn't intrepret any extrapolation of this discussion applying to to ALL doctor billing...except in my own opinion I do think there needs to be price controls in healthcare including physician billing ie: the scenario's Maggie just described.
No, Bingo, I'm sorry and sincere I guess I'm not understanding what your point is? Seriously, you gotta speall it out for me, draw me a map, paint me a picture.

[Barry Carol]

Bingo,

I have no problem with doctors who charge whatever the traffic will bear under the following circumstances: (1) they practice in a non-hospital setting, (2) they take no insurance whatsoever including Medicare, (3) their prices are completely transparent and the patient is made well aware of what the charges will be before services are rendered, (4) treatment is rendered on a non-emergency basis which affords the opportunity to comparison shop if he or she wants to, and (5) all patients pay the same rates except for discounts that, at the doctor’s discretion, can range up to 100% for charity and hardship cases. For any doctor who is so good and so sought after that he or she can sustain a practice without taking insurance, I say good for you.

While I stand by the comments I made with respect to doctors who treat patients in a hospital setting, I would like to offer the following comments to amplify and clarify my previous post. Many doctors take all sorts of insurance including both Medicare and most private insurers who operate in their area. However, for patients who either have insurance that the doctor does not take or for patients who are uninsured yet can afford to pay, they are expected to pay the full list price which can be two times or more what the doctor routinely accepts as full payment from insurers. I find this practice grossly unfair.

I can cite two examples from my own experience. First, until very recently, my health insurance did not cover routine eye exams. My ophthalmologist charge $170 for this. I’m expected to pay that price at the time of service which I do. He gets immediate cash flow and his staff does not have to file an insurance claim and wait to be paid. From insurance, he accepts about 40% below list as full payment, waits for his money and incurs the administrative costs of filing claims. I also don’t have dental insurance. I pay full price immediately for cleanings and fillings while the practice accepts significantly less than I pay from insurers as full payment. Again, they wait for their money and incur the administrative costs related to filing claims while I pay immediately. While I understand that the rules require doctors and hospitals to bill everyone at list price, I think self-payers who pay immediately at the time of service should receive a courtesy discount that brings the net amount paid into line with what they accept as full payment from private insurers, especially since I’m paying immediately and there are no administrative costs. In my prior comment, I suggested a proposed maximum of 120%-135% of the Medicare rate because that is what insurance executives tell me that their companies pay on average for all services. For some services, they pay as much as 175% or so and a few are actually paid at less than Medicare rates, but overall, it averages out to 120%-135%.

By the way, if you wouldn’t mind telling us, what is your medical specialty?

[bingo]

Ah, Lisa, read me more carefully. I agree with both you and Maggie on the "phantom doctor" issue. What I don't agree with, and what I find impossible to agree with, is the extrapolation of this "phantom doctor" billing to ALL doctor billing.

Listen, I'm a patient, married to a patient, father of three patients. I purchase health care insurance for 14 families. I also provide health care. I understand your issue on all three levels. Do you understand my point? Does Maggie? Are you even trying?

[Lisa Lindell]

Bingo, the reality we have now, is the "phantom doctor" analogy Maggie wrote about and was highlighted in the news story. We don't have full disclosure. PS this happened to me a few times. Once was an $11 bill in 2004 for some type of diagnostic test that allegedly wasn't covered by my insurance at the time (allergic reaction to bee sting.) I wrote a stern letter which was ignored, I continued to get dunned for this $11 for at least a year. It's still on my credit report. Another was when my son had surgery (tonsils and adenoids removed)...which was probably 2002. The entire thing was pre-approved and they made sure I pre-paid my share which I believe was $800. The financing of this was thoroughly investigated and pre-approved by the physician and the hospital. Several months later, I got these phantom bills I believe at least one was for an anethesiologist. Again I wrote my stern letters and again they were ignored and again, I'm sure it's still on my credit report.
This is off-topic but I read with interest the lining out and marking through on admission docs. When my husband was discharged from the hospital he had numerous physician appointments with specialists of just about every type. Suffice it to say it was a full time job for myself, my sister and the insurance case manager just to keep up with, schedule and transport him to all these appointments.
Every single time I had to fill out the same forms, sign the same thing, within a month I could have filled the trunk of my car with all these HIPAA forms. Then one day I was bored and actually started reading them. On subsequent appointments I tried that trick, lined through this, added a comment, the details are fuzzy now but the end result was, they refused to see him unless I or he signed with no marking or cross outs of any kind. 2 years ago I had to get my eyes checked, I got the form to sign indicating I had received a copy of their privacy policy, I commented I did not receive their privacy policy "I know, we're out, but you have to sign it or we can't examine your eyes."

[bingo]

Maggie:

I agree with your response to Howard. I've had more difficult discussions with all manner of individuals about forms, etc. where I have done exactly the same thing!

But Maggie, re-read your initial post. I understand the original intent, and I largely agree with the original sentiment. Look again, though, at how you expand your directive to include not only hospital based doctors but ALL doctors. It's a tactic you utilize repeatedly. It cheapens your position. The unreasonable ambush foisted upon unsuspecting patients in the hospital is rightfully called on the carpet. It is not reasonable to extrapolate this to ALL physicians. Why is Barry's call to limit non-hospital based physician fees to a % of medicare reasonable? The burden of proof is on you. With full disclosure patients are, and should be, free to choose to accept the fees. It's an different construct entirely compared with your "phantom doctors" isn't it?

[maggiemahar]

Howard -- Good to hear from you again.

You wrote:
"I have taken those [consernt] forms, and lined out certain sections, pointing to a marginal note . ."

People need to realize that, when signing consent forms, they can cross out sections, initial them, or add something--just as with any other contract.

[Howard C. Berkowitz]

Before getting into the more insidious interactions among insurers and providers in urgent to emergent situations, I've had some interesting times at hospital admitting desks. Many of the billing agreements have provisions having me agree to the charges of principally in-hospital specialists.

I have taken those forms, and lined out certain sections, pointing to a marginal note. For example, if I am being admitted by and will be seen by my own cardiologist, I explicitly refuse, in advance, any interpretation of electrocardiograms by other than my own physician, unless another physician certifies, in writing, that the interpretation was for a critical emergency situation. The reality is that very few true cardiac emergencies call for painstaking analysis of a 12-lead EKG. I further say I'm not willing to reimburse the hospital for its own quality control.

I will make similar refusals -- as in no HIPAA access to my record -- to a pathologist that doesn't do an actual interpretive report. No payment authorization for general lab oversight, although I can't do anything about the piecework reimbursement often priced into the hospital charge for clinical lab tests.

This has worked at times, once I realized the trick was invoking HIPAA. Oh, they can say they gave a "routine" EKG to a cardiologist (sometimes who read it only after my discharge), but if they do, I have them dead to rights on a violation of the HIPAA privacy rule.

Things get much more difficult in more urgent situations. On one memorable occasion, I hit a just-mopped floor, water-skiied across the living room floor, and fell hard. Now, I was probably in denial--if I had thought about it, the Ottawa Ankle Rules, which are physical exam criteria, told me I had a broken ankle, which I should have taken straight to my orthopod.

Unfortunately, I had been on the way to see my internist, who then informed me that the insurer wouldn't let me be X-rayed in their office. I was then sent to a local hospital as an outpatient for X-ray, and the technician and I could both see the break. Nevertheless, I then had to get an ER admit (and I was in a lot of pain), have the ER put me in a soft cast, and send me to my private orthopod.

He looked at the films -- he is quite cost conscious and didn't take new ones -- and muttered that he thought he could avoid operating and pinning it. When I told him I had to be in Vancouver in 2 days, he looked me in the eye, told me that he'd put me in an appliance that I could rip off, and that if I had the slightest suspicion I was developing compartment syndrome, I was to ask for an emergency landing. He then gave me a very generous pain prescription, such that my seminar found me very, very mellow -- except when I banged my foot.

Sometimes, relationships work. Tomorrow, though, I'm off to see a new cardiologist, having been annoyed up to date with demands for records, by the staff, which in my professional judgment were irrelevant to the reason I was asking for consultation. We shall see; my primary internist picked out the particular cardiologist from the group, with the comment "he has the ego strength to deal with you. I think you'll like each other."

[maggiemahar]

Bingo and Alex

Bingo It was apparent to Barry--and I think to most people --that the post was about physicians who patients do not choose. (See the word "Blind-Sided" in the title.)

The family with the infant who had heart surgery had no way of knowing who the assitant might be--and how much he would charge.

Of course, if patients choose to go out of network, and accept higher charges, that is fine--up to a point.

I think many of us have a problem with physicians who charge exorbitant fees because they know they have a gun to your head: "Pay what I ask, or diel." Too often, they use the higher price to imply that they are "better." (See my reply to Barry.)

I tend to agree with Barry
when he writes that

"service as well as where the provider’s bill ranks on a percentile basis within his or her region. Personally, for any bill of more than a couple of hundred dollars, I don’t think the total payment (both insurer allowance plus patient responsibility) should be more than 120%-135% of the Medicare rate at most."

Alex-- I totally agree that insurers need to alert patients to the fact that if they go out of network, they are taking a risk that the insurer may reimubrse only a small percentage of the fee. Insurers normaly reimburse a percentage of out-of-networks fees based on "what is reasonable and customary" in that zip code.

So while insurance may reimburse 80% if a physicans chooses to charege twice what most doctors in that specialty charge in that zpi code, the patient may well find that the insurers pays significanctly less than 80%.

Finally, because patients are often very vulnerable customers--they are sick; they are in pain; often they are elderly; sometimes they are very scared--they need some protection, I think.

Probably there should be some caps on how much doctors can charge above and beyond average fees in their area. (See Barry Carroll's suggestion of 120 to 125 percent of what Medicare pays for high-priced procedures.

[Maggie Mahar]

Barry--

Thanks for your comment.

I agree with virtually everything you say.

If it's doctor vs. patient, it definitely isn't a fair fight.

Hospitals needs work out payments with docs. If necessary, government should intervene, as the California law would, to protect patients.

Just one point where I disagree:
It is, I'm afraid, an urban myth that "the best" surgeons often don't take insurance.

Doctors who went into medicine for the money (rather than out of desire to help people or a serious commitment to science) are the ones who are most likely to refuse insurance.

As other doctors will tell you: these are rarely "teh best."

Though I agree that in Manhattan, and in its suburbs, many doctors seem focused on the $. This is probably not surprising, New York is, and always has been, all about money, the way Washington is all about politics, LA all about celebrity, etc.

But it's worth noting that when you look at the Dartmouth Atlas, you find that NY hospitals do not provide the highest quality, most efficient care.

Most doctors agree: the"best" doctors tend to be found at places like the Mayo Clinic (where they work on salary, earning far less than they would in private practice) and at top academic medical centers like Dartmouth, UCSF, etc.

As a doctor said to me recently "working there (at Dartmouth or UCSF) is like playing with the Yankees."

When I was at Dow Jones, I had insurance that covered virtually all of my costs whether or not the doctor was in an insurance network, and so I've gone to doctors who don't take insurance and to doctors who do.

The doctors who don't take insurance tend to have offices that look like an expensive decorator did them--that's about it.