April 15, 2016

FRS Assesses Why Florida Restricted Balance Billing

Despite months of grueling work, the Florida Radiological Society (FRS) is considering how to sharpen its government relations efforts after it was unable to persuade legislators to reject HB221, a bill that enacts balance billing restrictions while overlooking the actual causes of out-of-network patient billing in the state.

HB221, which awaited the signature of Gov. Rick Scott on April 13, was mistakenly hailed as a significant consumer protection measure, but it does not address specialty care gaps in insurance coverage product sold to health care consumers. Such gaps — and not balance billing — are ultimately responsible for the extraordinary cost of out-of-network services that are shifted to the patient.

Balance billing occurs when an in-network facility employs or contracts with an inadequate number of in-network specialty providers.. Patients receive services from out-of-network specialists because these providers were unable to negotiate a fair contract or have been dropped from participation with the insurer, often with little notice.

In essence, HB221 applies existing HMO provisions on balance billing to the PPO arena. Under an HMO arrangement, physicians are reimbursed “usual and customary” fees, but HMO insurers reimburse physicians at substantially reduced rates since “usual and customary charges” are not defined in Florida. The state’s lack of a viable dispute resolution mechanism essentially allowed insurers to set the rates for these patients.

FRS has pursued a defensive strategy on the issue of balance billing for several years. Florida’s legislature is unique in the sense that the political divisions are primarily not between Democrats and Republicans, but rather between its two legislative chambers.

Understanding the political environment within the state’s legislative body is essential to successful government relations, but a broader understanding of how the regulatory and executive branches play into the mix is also crucial. Securing professional help from a reputable lobbyist is key and is a worthwhile investment for any chapter. But despite being politically active, organized and well-prepared for legislative battle, the FRS found the balance bill legislation ensnared by political power plays that prevented the typically pro-physician state senate from blocking highly unfavorable balance bill legislation.

How did a measure so troubling to the house of medicine come to pass? Many would agree that the culprit was medicine’s inability to stand together. A lesson learned here is not only the importance of strategy, coalition building and political activism, but rather making sure long-term relationships among the stakeholders are solid enough to withstand political pressure.

As expected, the insurance industry has been united in its public relations campaign that wrongfully alleges that physicians are perpetrating egregious offenses against the patients they serve. Unfortunately, an overwhelming majority of physicians are becoming collateral damage in a media war against a few rogue practitioners who are publicized for charging exorbitant fees to their out-of-network patients.

In the absence of a pro-physician narrative, the public and the legislators are faced with what the insurance lobby lays at their feet. Well-meaning consumer groups have played into the hands of the insurance industry by coming to erroneous conclusions from what little data exists on the subject of out-of-network billing. Even statistics from reputable sources, after being creatively manipulated for its public relations potential, can have the same detrimental effect on the public image of physicians. As the Florida experience shows, discounting the power of an anti-doctor PR campaign is not only naïve, it is outright dangerous.

With these developments in mind, Eugenia Krimer Brandt, the American College of Radiology’s state affairs director, recently asked David Epstein, MD of FRS for his advice on how other College chapters should prepare for such battles. He responded as follows:

“I would highlight three main points: knowing your support structure within the legislature, taking the time to build bridges and relationships before you are in crisis mode and working on a PR campaign in advance.

“The first two of these we have done, and done well, but we were not prepared for the unexpected failure of support from the Florida Medical Association and the highly effective anti-physician PR campaign, built on false and misleading data and orchestrated by the insurance lobby and well-meaning, though misguided consumer groups. Unlike in the past where balance billing was considered a wonkish issue discussed mainly with legislative staff members and analysts, it became a high-profile issue in state and national media and was featured across Florida in citizen roundtables sponsored by the State Office of Consumer Protection.

“The PR battle we found ourselves losing was not helped by the fact that while the insurers were pushing this as landmark consumer protection legislation, we were fighting this battle to maintain the physicians’ ability to negotiate a network contract, not just for this small group of patients, but for every commercially insured patient PPO in the state. This critical aspect of the issue flew over the heads of most consumers and did not move in a direction that was likely to recruit their support.

“This is why it is imperative to get to work immediately with consumer entities in a fact-driven PR campaign to point out that the biggest factors driving patient dissatisfaction with their bills are high deductible plans and thin plan networks, not balance bills.

“It is important to know your political support, maintain a strong coalition with other physician specialties and solidify the support from your state medical society. The playing field has been rigged, and it’s a hard battle, but all you can do is be prepared and make sure your relationships can withstand the political storm.”