A lawsuit in California is pitting a large insurer against a network of surgical centers over patient referrals to out-of-network providers, according to a Workforce report.
In the lawsuit, Aetna alleges that Bay Area Surgical Management of Saratoga, Calif., which operates six ambulatory surgery centers, is grossly overcharging for its procedures. The insurance company alleges that physicians waive co-payments and other fees for patients who receive treatment and then bill Aetna for the difference.
The practice has cost Aetna an alleged $23 million for about 1,900 procedures in the past two years. Aetna alleges the costs should have totaled $3 million.
The practice of "balance billing" occurs when a patient who chooses to go to an out-of-network provider is billed the balance of what the insurer won't pay for the non-contracted service. The practice has been banned in California, though physician groups say that balance billing is essential to making sure providers are paid fairly.
Insurance experts say when employees use out-of-network providers, employers experience higher costs because there is no discount to charges. Employers are addressing the issue by increasing deductibles and lowering out-of-pocket maximums so that employees must pay a larger share for going out-of-network.
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In the lawsuit, Aetna alleges that Bay Area Surgical Management of Saratoga, Calif., which operates six ambulatory surgery centers, is grossly overcharging for its procedures. The insurance company alleges that physicians waive co-payments and other fees for patients who receive treatment and then bill Aetna for the difference.
The practice has cost Aetna an alleged $23 million for about 1,900 procedures in the past two years. Aetna alleges the costs should have totaled $3 million.
The practice of "balance billing" occurs when a patient who chooses to go to an out-of-network provider is billed the balance of what the insurer won't pay for the non-contracted service. The practice has been banned in California, though physician groups say that balance billing is essential to making sure providers are paid fairly.
Insurance experts say when employees use out-of-network providers, employers experience higher costs because there is no discount to charges. Employers are addressing the issue by increasing deductibles and lowering out-of-pocket maximums so that employees must pay a larger share for going out-of-network.
Related Articles on Coding, Billing and Collections:
Op-Ed: 5010 Deadline Approaches, Physicians in Varying States of Preparedness
Medicare Overpayments/Underpayments Interest Rates Rise
Employers Could Drop Insurance After 2014, Republicans Say