Insurance company Aetna recently reached out to members and their physicians to alert policyholders when a referral for an outpatient surgical procedure takes them out of the Aetna network, creating another obstacle for out-of-network surgery centers.
According to an Aetna release, an analysis by the insurance company showed that half of members who received a referral to a surgery center did not know the referral would take them out-of-network. When those members were informed by Aetna and chose to stay in-network, the average medical bill was reduced by $5,000 per incident.
The Aetna program is based on a pre-certification process that requires physicians to alert Aetna when they refer to an out-of-network, free-standing ambulatory surgery center for care. Aetna will follow up with the physician and member to confirm the member understands the referral will take them out-of-network.
This move by Aetna creates another challenge for already-struggling out-of-network providers, says Jeff Shanton of the New Jersey Association of Ambulatory Surgery Centers. "Aetna states that 'people always have a choice in where they seek care,'" he says. "That is a very broad statement and, indeed, not quite true. Aetna — along with other commercial carriers — has, for the past several years, embarked on a campaign to effectively eliminate out-of-network as an option where ASCs are concerned."
He says while the NJAASC supports transparency and disclosure in the healthcare delivery system, the openness must work both ways. "Too often, out-of-network providers find roadblocks thrown in their path when attempting to ascertain patient benefits, in order to inform the patient of their potential liability," he says.
He says through restrictions, caps, policy language and provisions, the ability to utilize out-of-network benefits has been severely curtailed. Aetna and other carriers routinely contact patients scheduled for out-of-network surgery to persuade them to choose an in-network provider, he says.
Aetna does not refute this claim, but presents it in a different light. Since August 2010, the insurer has found 38,000 occasions nationwide where an in-network physician referred an Aetna member to an out-of-network ambulatory surgery center. In nearly 60 percent of these cases, Aetna told the member and their physician about a less expensive, in-network facility or hospital at which the member's referring physician had privileges.
Mr. Shanton responds that the number of incidents reported by Aetna (38,000) is very low when one takes into account the total number of procedures performed by ASCs nationwide every year. "There are ASCs that, by themselves, perform over 10,000 cases per year," he says. He also questions Aetna's claim that patients choosing out-of-network benefits can be redirected to a less-expensive in-network facility where their referring physician has privileges. Because physicians do not usually perform procedures at multiple ASCs, the alternative would most likely be a hospital outpatient department, which receive higher reimbursement rates and therefore cost more than freestanding surgery centers.
Mr. Shanton adds that Aetna offers a significant number of plans that restrict out-of-network benefits to $2,000 per calendar year for procedures performed in an out-of-network ASC. "In addition, there is no reduction in the premium the policyholder is still paying for the privilege of being able to go out-of-network," he says. "The policyholder has the illusion of out-of-network benefits, but the reality is quite different."
He adds that the New Jersey division of Aetna has stopped negotiating with new and existing facilities that want to participate in their network, inevitably increasing the number of out-of-network claims.
Mr. Shanton that Aetna is trying similar tactics with in-network providers. In recent months, the New Jersey division of Aetna has sent letters to physicians and patients, attempting to steer them to cheaper in-network providers — meaning those that have less favorable contracts with the insurer. "By directing patients in this manner, Aetna literally holds the fate of in-network centers in its hands as well," he says. "If an in-network center has negotiated a favorable deal for the center with Aetna, they can now look forward to patient volume decreasing, as it is re-directed to a cheaper alternative."
"Out-of-network needs to remain a viable option for all healthcare providers," Mr. Shanton says. "This is not just about out-of-network providers. By allowing carriers to eliminate out-of-network through pricing, caps or restrictions, [the healthcare industry] reduces the ability of all providers to negotiate in-network contracts." He says eliminating options other than negotiating in-network contracts — often at unfavorable rates for the surgery center — is "akin to having a monopoly" for the insurance company.
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According to an Aetna release, an analysis by the insurance company showed that half of members who received a referral to a surgery center did not know the referral would take them out-of-network. When those members were informed by Aetna and chose to stay in-network, the average medical bill was reduced by $5,000 per incident.
The Aetna program is based on a pre-certification process that requires physicians to alert Aetna when they refer to an out-of-network, free-standing ambulatory surgery center for care. Aetna will follow up with the physician and member to confirm the member understands the referral will take them out-of-network.
This move by Aetna creates another challenge for already-struggling out-of-network providers, says Jeff Shanton of the New Jersey Association of Ambulatory Surgery Centers. "Aetna states that 'people always have a choice in where they seek care,'" he says. "That is a very broad statement and, indeed, not quite true. Aetna — along with other commercial carriers — has, for the past several years, embarked on a campaign to effectively eliminate out-of-network as an option where ASCs are concerned."
He says while the NJAASC supports transparency and disclosure in the healthcare delivery system, the openness must work both ways. "Too often, out-of-network providers find roadblocks thrown in their path when attempting to ascertain patient benefits, in order to inform the patient of their potential liability," he says.
He says through restrictions, caps, policy language and provisions, the ability to utilize out-of-network benefits has been severely curtailed. Aetna and other carriers routinely contact patients scheduled for out-of-network surgery to persuade them to choose an in-network provider, he says.
Aetna does not refute this claim, but presents it in a different light. Since August 2010, the insurer has found 38,000 occasions nationwide where an in-network physician referred an Aetna member to an out-of-network ambulatory surgery center. In nearly 60 percent of these cases, Aetna told the member and their physician about a less expensive, in-network facility or hospital at which the member's referring physician had privileges.
Mr. Shanton responds that the number of incidents reported by Aetna (38,000) is very low when one takes into account the total number of procedures performed by ASCs nationwide every year. "There are ASCs that, by themselves, perform over 10,000 cases per year," he says. He also questions Aetna's claim that patients choosing out-of-network benefits can be redirected to a less-expensive in-network facility where their referring physician has privileges. Because physicians do not usually perform procedures at multiple ASCs, the alternative would most likely be a hospital outpatient department, which receive higher reimbursement rates and therefore cost more than freestanding surgery centers.
Mr. Shanton adds that Aetna offers a significant number of plans that restrict out-of-network benefits to $2,000 per calendar year for procedures performed in an out-of-network ASC. "In addition, there is no reduction in the premium the policyholder is still paying for the privilege of being able to go out-of-network," he says. "The policyholder has the illusion of out-of-network benefits, but the reality is quite different."
He adds that the New Jersey division of Aetna has stopped negotiating with new and existing facilities that want to participate in their network, inevitably increasing the number of out-of-network claims.
Mr. Shanton that Aetna is trying similar tactics with in-network providers. In recent months, the New Jersey division of Aetna has sent letters to physicians and patients, attempting to steer them to cheaper in-network providers — meaning those that have less favorable contracts with the insurer. "By directing patients in this manner, Aetna literally holds the fate of in-network centers in its hands as well," he says. "If an in-network center has negotiated a favorable deal for the center with Aetna, they can now look forward to patient volume decreasing, as it is re-directed to a cheaper alternative."
"Out-of-network needs to remain a viable option for all healthcare providers," Mr. Shanton says. "This is not just about out-of-network providers. By allowing carriers to eliminate out-of-network through pricing, caps or restrictions, [the healthcare industry] reduces the ability of all providers to negotiate in-network contracts." He says eliminating options other than negotiating in-network contracts — often at unfavorable rates for the surgery center — is "akin to having a monopoly" for the insurance company.
Related Articles on Out-of-Network:
Maryland Health Insurance Plan Makes Cost Benefit Changes
OB/GYN, Aetna Dispute Could Affect 50,000 Arizona Patients
When 5010 Implementation Delays Surgery Center Payment: 4 Ways to Respond