State insurance superintendent takes aim at surprise health care billing

John Franchini

New Mexico residents who have private health insurance are not only frustrated over unexpected bills from hospitals and providers. They also believe that complaining or trying to resolve disputes is not productive, according to a recent survey.

A total of 554 privately insured adults were surveyed from August through September by the Center for Health Policy at The University of New Mexico under the direction of the state Office of the Superintendent of Insurance.

Insurance Superintendent John Franchini is supporting legislation to ease the burden of surprise health billing on the public.

“It’s a huge issue,” Franchini said. “It’s not right and it’s not fair to the policyholders in our state to be subjected to this type of treatment.”

One measure introduced in the 2017 legislative session would have made it illegal for providers to send a bill with out-of-network charges for emergency care, instead requiring the hospital to resolve issues with its own medical groups. The measure also would have increased transparency for all medical billing and created a state-level appeals process to handle consumer complaints about disputed bills.

The bill received a hearing in the House Health Committee, but never advanced.

According to the survey results, there is more need than ever for consumer protections.

Franchini has drafted new legislation that he will be pursuing in the 30-day legislative session starting next month. He is soliciting public comment on the changes that would restrict out-of-network billing for some procedures and increase disclosure requirements for providers.

Among the findings of the survey:

• Twenty percent of privately insured New Mexicans received a surprise medical bill. The number was much higher, 55 percent, for those who went to the emergency room or who have had a recent surgery, 36 percent.

• Of those who received a bill, 46 percent of the charges came from a doctor they did not expect, 26 percent from multiple providers and 28 percent from some type of out-of-network service.

• Sixty-seven percent of consumers tried to take action to resolve the disputes. But 31 percent did nothing and most of those eventually paid the charge.

“A common reason for inaction was the consumer’s belief that it wouldn’t make a difference, which is a widely held perception among the privately insured public,” according to summary of the survey results. “Many respondents expressed confusion about what to do when they experience problems with their insurance bills.”

A big part of surprise billing is the use of in-network and out-of-network providers. In an effort to control costs, most insurance plans have a contracted network of doctors, clinics, hospitals and specialists that agree to provide services at a set price. But it is the responsibility of patients to understand who those are and where they are located, and for insurance companies to communicate that policy.

In the case of hospital care, a certain facility can be part of an insurance network and bill at that price for services it provides but still not have the medical staff for emergency or specialty care 24 hours a day. To maintain that round-the-clock coverage, a necessity for accreditation, hospitals in rural areas and even Santa Fe use outside medical groups, some of which may be not be under contract with every insurance plan.

While some states require notification when an outside provider is using a hospital or clinic, New Mexico does not.

“Many privately insured New Mexicans assume that doctors they see in an in-network hospital are also in network,” according to the survey. “Nearly all respondents (96 percent) believe that hospitals should have to notify patients if a doctor/technician involved in a procedure performed at that hospital will be out-of-network.”

Another finding in the survey was that residents in the Albuquerque metro area had the fewest complaints about surprise bills at 18 percent. Those in Santa Fe County had the highest level at 24 percent, perhaps a reflection that Christus St. Vincent Regional Medical Center uses contract physicians to staff its emergency room.

Franchini also said Santa Fe has a large network of alternative health providers and many of those are outside insurance networks, which leads to confusion.

Franchini said his office can help those who have questions about their surprise bills, and encourages consumers to use the service. Paying a bill without questions works to further embolden hospitals and providers, he said.

“It makes them more aggressive with surprise billing if they don’t get caught,” he said.

Contact Bruce Krasnow at brucek@sfnewmexican.com.