Payers Use Varied Approaches to Trim ER Spending

From Health Plan Weekly

Insurers trying to contain the costs of unnecessary emergency room (ER) utilization have faced strong pushback in recent weeks. Yesterday, Anthem, Inc. was hit with a lawsuit filed by the American College of Emergency Physicians and the Medical Association of Georgia over denied ER payments. Meanwhile, its controversial year-old "avoidable ER program" led state lawmakers in Missouri to pass a bill reinforcing the "prudent layperson" standard; it was signed into law in June and is set to take effect in late August.

Separately, Texas state regulators have been wrangling with Texas Blue Cross and Blue Shield over its approach, initially set to begin June 1, denying coverage for out-of-network ER visits determined after the fact not to be true emergencies.

Chris Callahan, a Texas Blues spokesman, describes this as a change in the insurer's claims review process, not a policy change. He adds that the insurer also will review the medical record to determine the reason the HMO member sought emergency care out-of-network.

In Massachusetts, Commonwealth Care Alliance (CCA) is tackling the ER issue through its Mobile Integrated Health program, launched in 2014. Under the program, emergency department visits were avoided in 82% of cases, resulting in estimated total savings exceeding $6 million, CCA said.

Joe Paduda, principal with Health Strategy Associates, LLC, suggests that the most effective emergency department (ED) usage management programs seem to be provider-driven.

"The issue for insurers is they don't have the ability to divert the patient at point of service, while health systems and hospitals love the high revenue from privately insured patients," he says.

According to Paduda, the optimal solution is for insurers and health systems to work together. But he concedes this is unlikely to occur or won’t be effectively implemented "unless both have financial skin in the game….Some version of a shared savings model around ED visits might be a good place to start."

Subscribers may read the in-depth article online. Learn more about subscribing to AIS Health's publications.