Health Providers Watch for Passage of Bill that May Change Their World: "Preferred Provider" Contracts May Be Eliminated

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Imminent passage of the health care reform bill, The Affordable Health Care for America Act, is still uncertain, but as currently written, provisions of the law will be enacted within six months of signing. If passed, hospital billing and collections operations will see sweeping changes, including massive revisions or even elimination of managed care contracts.

We've utilized the Federal ERISA law since our inception to resolve payment disputes between hospitals and insurers, and are closely watching the Senate's actions

Claims Recovery Company (CRC) is preparing for an influx of requests to assist hospitals facing the potential elimination of their contracts with insurers. It may now be urgent for healthcare providers to take full advantage of ERISA regulation provisions as the Senate contemplates changes that could eliminate current managed care contracting models for hospitals.

"We've utilized the Federal ERISA law since our inception to resolve payment disputes between hospitals and insurers, and are closely watching the Senate's actions," said F. Scott Winslow, CEO of the three-year-old firm. "Our expertise is focused on the 35-year-old ERISA law and its claim regulations and stipulations. This has enabled us to help hospital clients coast to coast receive the full payment provided under federal law."

Although still uncertain what final provisions will be signed into law, several that are considered the "base" of the bill are not likely to change. These stipulations have not received much attention in the press. However, they are critical to hospital operations because of the impact that they will have on existing discount contracts with payors and the new mandatory process that will have to be followed to be paid.

Among the most important are the antitrust provisions of H. R. 3962. These represent a first-time opportunity for health providers to level the playing field with the insurance industry through the use of ERISA 29 CFR 2560.503-1. ERISA will be statutorily incorporated in its entirety into the new law for all qualified health benefit plans (QHBP), of great importance to healthcare providers for reimbursement purposes.

The Affordable Health Care for America Act will create a new federal agency, Health Choices Administration, regulating qualified health benefit plans (QHBP), consisting of employment-based health plans, the traditional voluntary ERISA plans, and health insurance exchange plan, the new mandatory ERISA plans. CRC, the recognized expert on ERISA claims, anticipates hospitals and healthcare providers will seek technical assistance with the following provisions of the new law:

Sec. 232 (b) of the Act, Requiring Fair Grievance and Appeals Mechanisms of the Act provides: "(b) INTERNAL CLAIMS AND APPEALS PROCESS.--Under a qualified health benefits plan the QHBP offering entity shall provide an internal claims and appeals process that initially incorporates the claims and appeals procedures (including urgent claims) set forth at section 2560.503-1 of title 29, Code of Federal Regulations, as published on November 21, 2000 (65 Fed. Reg. 70246) and shall update such process in accordance with any standards that the Commissioner may establish". CRC is expert in this area and currently offers this service to existing clients.

Sec. 232 (c) of the Act also creates a new federal external review process based on ERISA claim regulation to provide for an impartial, independent, and de novo review of denied claims, and the Health Choices Commissioner's decision shall be binding on the plan and the entity, as the final claim decision in absence of judicial review, which will now be available for punitive damages for exchange participating health plans. CRC foresees an extended ability to assist clients as it has prepared files for this process since its inception under the existing regulation process.

Sec. 233 of the Act, Requiring Information Transparency and Plan Disclosure, enhanced the existing ERISA disclosure obligations for the plan and insurance company, and requires "Accurate and Timely Disclosure", for both exchange participating health benefit plans and employment-based health plans, to both the Health Choices Commissioner and the public, doctors, hospitals and the patients, of plan documents, plan terms and conditions, claims payment policies, and practices, periodic financial disclosure, data on the number of claims denials, data on rating practices, information on cost-sharing and payments with respect to any out-of-network coverage, and other information. CRC expects a more timely compliance with its ERISA based appeals and document reviews under this section of the new law.

Sec. 233 (5) of the Act, Cost-Sharing Transparency, requires the plan to disclose to the healthcare provider the real fee schedule, plan usual and customary limit for individual service and supplies at Current Procedural Terminology (CPT) & Healthcare Common Procedure Coding System (HCPCS) code level. CRC foresees a distinct advantage in resolving appeals on behalf of its clients. The usual and customary provisions have been the most tightly held secrets of the insurance industry and subject to actions by attorneys' general.

Sec. 235 of the Act, Timely Payment of Claims, provides new federal "Prompt Pay" laws, based on Medicare Part C timeframe, Managed-Care Medicare, to comply with the requirements of section 1857(f) of the Social Security Act.

Sec. 238 of the Act, State Prohibitions on Discrimination against Health Care Providers, has adopted "Any Willing Provider Laws" from existing state laws. CRC sees a great advantage to its out of network clients and predicts a new era of contracting with insurance companies for its hospital clients if this provision is written into the final version of the law.

Sec. 251 of the Act provides new consumer protections, with state law compensatory and punitive damages as remedies for exchange-participating health plan members. Although the new law does not change the status of ERISA preemption as desired by the insurance industry, state punitive damage remedies for employment-based health plans (traditional ERISA plans) will remain in effect.

Sec. 257 of the Act allows state attorneys general to sue for the compensatory and punitive damages on behalf of the private citizens of the state for any violations by the exchange-participating health plans, although traditional ERISA plans are still immune from state government actions from insurance commissioners or attorneys general.

Sec. 262 of the Act, Restoring Application of Antitrust Laws to Health Sector Insurers. If signed into law, this will cripple the existing managed care practice model and in conjunction with vigorous enforcement of the new provision for federal ERISA claim regulations, complete disclosure of plan information and fee schedules will now be mandatory under a proper ERISA appeal.

The Affordable Health Care for America Act is 1990 pages long. For more information and relevant documents, please visit the Website of House Of Representatives:

CRC, based in Rockford, Illinois, offers, as an outside service, a process to appeal insurance claims under federal ERISA law as a patient advocate. This has the potential to deliver substantial portions of the contractuals for any claim where the commercial insurance coverage was issued by an employer (government, church and a few other minor categories are excepted). CRC performs this "administrative appeal" process with no upfront fees and is paid a percentage of new payments delivered directly to the hospital. CRC's staff performs all work and answers all correspondence. CRC's approach has been utilized by hospitals and other providers coast to coast for over ten years.

More Information: Linda
Or SWinslow(at)crcclaim(dot)com

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