The American health insurance situation is complex, and at Marina we readily understand patients’ confusion and frustration at times with the system.  For a complex case, patients can receive bills from multiple physician specialties – such as emergency medicine, anesthesiology, and surgery – for the “physician costs” as well as a separate bill from the Hospital for the “facility costs”.

One aspect that is often difficult to understand for patients is that while a patient’s managed care plan or insurer may have a contract with a specific Hospital, the emergency department physicians may not have a contract with that managed care insurer.  The reason for this is that in most of the nation’s emergency departments (“ED”), the ED is managed by a group of doctors who are legally separate from the Hospital, and who have a contract themselves with the Hospital to manage the ED.  The situation is somewhat similar to a mall in which retailers lease space in the mall but operate separate stores.

This is important because if there is a contract then the Hospital or physician has agreed in advance to accept a certain payment in full for services (i.e., the “contracted rate”) and the patient has no further financial obligation beyond a co-pay or deductible.  If the Hospital or physician does not have a contract with the patient’s insurer, however, then the patient is personally responsible for paying the bill.  In the great majority of cases the reasons why the doctors do not have a contract with an insurer is that either few of the insurer’s members go to that ED and so there has been no need for a contract, or the insurer refused to contract at a rate that was fair to the physicians.  Many managed care plans, for instance, despite billions in profit, want ED physicians to contract at rates that don’t even cover the doctors’ costs.  At Marina we always bill the patient’s insurer anyway even if there is no contract, as a courtesy and at no cost to the patient.  If the insurer pays the bill in full then the matter is finished.  But if the insurer fails to pay the bill, or pays only part, the patient then remains responsible for the unpaid balance.

There are two ways in which these problems can be alleviated.  First, require all managed care plans and insurers to inform their members about not only which hospitals have contracts and are thus “in network”, but also which EDs are “in network” since they usually contract separately.  Second, require all managed care plans and insurers to contract with ED physicians at fair and reasonable rates.