Monday, August 11, 2008

Unbalanced Billing in California Hospitals: the Sacramento Bee Weighs In

Editorial not sure who's the Bad Guy - but understands The Problem

By John R. Graham

Categories: California, Hospitals, Insurance Regulation

The Sacramento Bee, our fair capital's daily newspaper, has editorialized on the issue of "balance billing," whereby ER doctors and hospitals which are not in a patient's health plan's network, send high-priced (and unexpected) bills to patients. Interestingly, although the editorial leans against the health plans, it approves of the state's new regulation forbidding doctors and hospitals from balance billing.

The Bee notes that there are already laws in place that require health plans to pay "usual and customary" charges when a provider is out of network. However, this is a patch, not a solution. If there is disagreement, how can the state decide what "usual and customary" charges are? No wonder hospital prices are in cloud-cuckoo land!

Lest we forget, the new regulation specifically chooses sides in favor of the health plans, and against the providers. As I've written before, there is no perfect solution to this question. Nevertheless, I have proposed binding arbitration as a better way than the state picking sides.