The latest contract squabble between a major national health insurer and a physician staffing firm is a quintessential example of why Congress needs to pass a fix to ban surprise billing, health policy experts say.
Come Sunday, March 1, an anesthesiology group in North Carolina will no longer be considered in-network for members covered by UnitedHealthcare, the nation's largest private health insurer.
The group, called American Anesthesiology of North Carolina, is made up of more than 80 anesthesiologists in the Raleigh-Durham area who provide services to hospitals that are part of some of the largest health systems in the state, according to the group’s website.
UnitedHealthcare provided the North Carolina Department of Insurance with estimates of those that could be affected, including approximately 11,141 customers and 176 physicians, a spokesman for the department told Healthcare Dive.
Even though the state has some consumer protections when it comes to surprise billing, it will not be enough to shield all patients in this instance if, and when, surprise bills arise, according to Jack Hoadley, a health policy analyst and researcher at Georgetown University.
North Carolina law only protects patients from balance bills in emergencies, so in this case those undergoing elective surgeries or other procedures requiring anesthesia are most likely to be exposed.
"People are really put in a tough situation when they end up using one of these physicians and they’re insured by UnitedHealthcare," Hoadley told Healthcare Dive. It’s why the nation needs a federal fix to this problem, he said.
Even some of the savviest shoppers can still get hit with bills they weren’t expecting, despite picking an in-network facility and an in-network doctor. Even if patients do their due diligence, its still possible for their anesthesiologist, for example, to be out-of-network — unbeknownst to them.
The group in North Carolina is just the first in a wave of Mednax providers that will soon find themselves on the outside of UnitedHealthcare’s network unless the two can agree to pricing terms. UnitedHealthcare said it terminated its contracts with Mednax, a physician staffing firm that primarily provides anesthesia, neonatology, and high-risk obstetrics in both urban and rural areas, because it charges more than other providers delivering similar services.
The terminations will affect three other states beyond North Carolina, including Arkansas, Georgia, and South Carolina, all states without comprehensive protections to balance bills.
The spat also comes as lawmakers weigh several competing version of bipartisan legislation to ban surprise billing, though a final version passing both houses of Congress in an election year is far from certain.
However, the issue is hitting at the same time Georgia’s state legislators are working toward a surprise billing ban of their own.
Steve Manders, director of insurance product review for Georgia, told Healthcare Dive the surprise bills are definitely a problem in the state but nothing new, citing a number of contract fallouts between payer and providers in recent years.
"This is something that we’ve been dealing with on a fairly regular basis here in Georgia," Manders said.
Come May 1, the first Georgia Mednax group will be out of network with UnitedHealthcare, potentially exposing families with ill newborns to significant out-of-network bills.
The Pediatrix Medical Group of Georgia is comprised of nine physicians who provide neonatal intensive care in the NICUs of three Atlanta hospitals, according to the group’s website.
UnitedHealthcare covers nearly 154,000 people throughout Georgia through its small and large group market, according to data provided by the Georgia Department of Insurance.
However, this figure does not include the number of enrollees covered by self-insured plans, typically used by employers with a significant number of employees. UnitedHealthcare is Georgia’s fifth largest insurer when it comes to fully-insured health products.