Surprise medical billing for emergency department visits at in-network hospitals substantially increased between 2010 and 2016, and patients' costs associated with those bills have nearly tripled over the same period, according to a study from the Journal of the American Medical Association Internal Medicine.
Surprise billing refers to patients being left with large medical bills after insurance providers do not cover the full amount, a practice called balance billing. This practice typically occurs when patients receive out-of-network and emergency care.
Between 2010 and 2016, approximately 39.1% of visits to emergency departments at in-network hospitals resulted in out-of-network bills, with the rate growing from 32.3% of visits in 2010 to 42.8% in 2016, according to the Aug. 12 study. Furthermore, the authors found that the potential costs to patients for emergency care at in-network hospitals grew from a mean of $220 in 2010 to $628 in 2016.
The authors evaluated the data of patients with private health insurance from Clinformatics Data Mart database, which is run by the healthcare technology company Optum Inc. The study focused on two primary metrics: the rate of surprise bills and the costs handed off to patients. While surprise billing has garnered a lot of attention recently, the authors wrote that "there has been little systematic study of its incidence and financial consequences."
Congress has recently worked to address the issue, calling multiple hearings in 2019 and advancing legislation that aims to stem the surprise bills. States have also taken matters into their own hands. But experts believe comprehensive federal legislation is still needed to properly protect patients.
Surprise billing grew for ER and inpatient visits
Emergency care can result in costly surprise bills because patients rarely have the ability to determine if services are in-network before using them. Industry representatives advocating for surprise billing legislation have specifically targeted emergency care as an area of needed change.
The authors said surprise billing is more common in emergency care; however, they found that out-of-network billing is also on the rise for inpatient visits.
Approximately 37% of inpatient visits to in-network hospitals resulted in out-of-network bills between 2010 and 2016, according to the study. The rate of surprise bills rose from 26.3% of inpatient admissions in 2010 to 42% in 2016.
Inpatient admissions also resulted in higher bills for patients. The average cost for patients more than doubled from $804 in 2010 to $2,040 in 2016, according to the study.
The average cost for patients in emergency visits was $419, compared to $1,003 for the top 10% of patients who have the highest potential cost. The top 10% of bills for inpatient visits totaled about $3,215 over the period, more than double the $1,574 average.
While some surprise bills can make patients responsible for thousands of dollars, costs of even a few hundred dollars can still be difficult for some patients. A 2018 report from the Board of Governors of the Federal Reserve System showed that four in 10 Americans could not pay a $400 emergency expense.
Among the instances of specialty services for emergency care, medical transportation produced the highest rate of out-of-network bills, with about 85.6% of all uses resulting in surprise bills between 2010 and 2016. Emergency medicine and internal medicine followed at 32.6% and 23.8%, respectively.
The study showed that while most hospitals had at least some instances of surprise billing, the practice occurred at some facilities significantly more than others.
Out-of-network billing occurred for less than 10% of inpatient visits at 48.7% of hospitals, and less than 10% for emergency visits at 24.8% of hospitals, according to the study. However, more than 90% of all inpatient visits resulted in a surprise bill at 15.2% of hospitals, and more than 90% of emergency visits had a surprise bill at 23.3% of all hospitals.
Jeanette Thornton, senior vice president of product, employer and commercial policy for the Association of Health Insurance Plans, a national representative of insurance providers, noted this phenomenon to Congress in her testimony for a June 12 hearing.
"The problem of surprise medical bills tends to be concentrated among a select number of providers from certain medical specialties often in certain geographic regions that are taking advantage of market dynamics where the patient has no choice in selecting the provider," Thornton said.