More Managed Care Contract Restrictions Equals Less Money

If you haven’t heard of House Bill 5085 in Illinois, you will. This is a major change in the way that payers are dealing with hospital based practices who do not participate. In the ever changing war of trying to receive payment for services, the payers have pulled out their nukes. This bill, which was passed at a late hour, states that a hospital based provider cannot balance bill a patient if the provider is non-participating with the payer. 

How does this affect your practice? This means you have no leverage to negotiate and the payer has the freedom to pay you what they deem to be a “usual and customary fee” for services provided. Understand there are some similar laws in Texas, Maryland, Arizona and Florida but most of those have dollar amount caps and are limited to just HMO patients. This law covers most insurance plan types. Several questions abound: What is the usual and customary fee? Who determines this fee?  Why wouldn’t the payers use a low rate, say…the Centers for Medicare & Medicaid Services (CMS) clinical fee schedule?…You can see where this gets really dicey. Also note: In Illinois, it is common for insurance plans to pay for clinical pathology. What happens if the payers determine that clinical pathology is not “usual and customary?” The final outcome of this has not been decided at this time. The law went into effect on June 1^st 2011 but no one really knows what this means at this time. Stay tuned…