Position
Any regulations or laws that restrict out-of-network fees and balance billing from the emergency department should provide that insurers reimburse emergency physicians for their professional services at rates consistent with “usual and customary charges.” The “usual and customary charge” for a service should be defined using a source of unbiased, third party data such as FAIR Health.
Background
EMTALA (the Emergency Medical Treatment and Labor Act of 1986) requires that every patient presenting to an emergency department must be examined and appropriately treated regardless of their ability or willingness to pay for that care, and regardless of insurance status or network. Although completely unfunded, this federal law created a safety net for everyone in the United States who needs emergency medical care. In fact, the Centers for Medicare and Medicaid Services has determined that it is a violation of EMTALA even to ask a patient about health insurance or warn a patient that the emergency physicians are out-of-network with his insurer, before all necessary emergency medical care has been completed.
Because of EMTALA, insurance companies know their clients – our patients – will receive all necessary care even if their insurer has no emergency physicians in its network, and thus insurers have little incentive to offer contract terms to emergency physicians sufficient to lure them into an insurance network. Only the ability of emergency physicians to stay out-of-network, bill an insurer at higher than in-network rates, and be paid by the insurer at that rate gives insurance companies a reason to negotiate in good faith with emergency physicians.
America's emergency departments carry a huge charity burden as they deliver care to the uninsured and Medicaid patients, and Medicare doesn't begin to fund that charity mission. If insurers are freed by restrictions on out-of-network fees and balance billing to choose for themselves what they will pay for emergency medical care, emergency physician groups will go out of business, emergency departments and even some hospitals will close, and the medical safety net will unravel. Out-of-network fees and balance billing ensure the strength and adequacy of the safety net for all patients, and cannot be safely restricted unless insurers are prohibited from paying out-of-network emergency physicians less than “usual and customary charges,” best defined as no less than the 80th percentile of “usual and customary” according to the FAIR Health database.
Approved: August 7, 2019