The decision of the UnitedHealth Group to ends off-grid coverage it took suppliers by surprise, with many speculating that the move is part of a broader set of policies by the nation’s largest insurer aimed at controlling costs and lowering supplier reimbursement.
As of July 1, UnitedHealthcare don’t pay anymore out-of-network complaints when fully insured customers seek non-emergency care outside of their local coverage area. Patients seeking treatment from “discharge” facilities far from where they live, including specialized care homes, residential treatment facilities, inpatient rehabilitation programs and even more, are subject to the new rule. Coverage areas typically include the entire state and surrounding states where patients reside.
“Anyone currently receiving treatment will be allowed to continue their treatment without interruption,” a United Healthcare spokesman wrote in an email. The company instituted the change as a way to reduce costs and improve quality care, according to the spokesman.
United has launched the policy for a selected number of fully insured employer plans and individual market health products, which are expected to fully adopt the new restrictions by mid-2022. The insurer has warned providers of the new policy in June, just days before CMS released an interim final rule implementing surprise billing protections that President Joe Biden enacted this year.
“Over the course of a couple of days, we started getting calls after calls from people who freaked out about it,” said Zachary Rothenberg, a colleague at Los Angeles law firm Nelson Hardiman, who represents a series of behavioral health providers. “The noise of the mill, as you can imagine, is warm.”
Healthcare providers are concerned about the short-term impact on their patients, as the canceled coverage affects those who are currently in facilities and who have received pre-authorization for treatment, in addition to the long-term impact. on its revenues and the precedent it could set for other payers, Rothenberg said.
In the case of substance use disorder, patients often leave their coverage areas for treatment because moving away from their current environments may result in better clinical outcomes, Rothenberg said.
Rothenberg said limiting patients ’options presents serious problems for people who need care. Nearly 120 million U.S. residents live in areas with shortages of mental health providers and only 27% of the population lives in poverty with an adequate supply of mental health professionals, according to a 2020 report by the Kaiser Family Foundation. Many providers of substance use disorders are grouped into specific areas, such as southern California or Florida, Rothenberg said.
There is no precedent for new U.S. health care limits for out-of-network care based on geographic location, Rothenberg said. In addition, United Healthcare can continue to tell its employer customers that it provides out-of-network benefits and potentially offers them lower premiums even when it denies coverage to policyholders. The company currently attracts one primary behavioral health case, Wit Vs. UnitedHealthcare Insurance Company. A lower court decision requires the insurer to process 67,000 behavioral health claims and rewrite its coverage policies around behavioral health treatment and substance abuse.
“I hope they are punished by this, but they really take it to a level or more extreme here,” Rothenberg said. “We don’t know if other major payers are watching and going to follow suit and if that’s just the tip of the iceberg.”
The timing of UnitedHealthcare’s policy change can be credited to the increase in opioid abuse during the COVID-19 pandemic, said Bob Poznanovich, vice president of business development at the Center City-based Betty Ford Hazeldon Foundation, Minnesota. Insurers have also seen increasing costs associated with rehabilitation facilities seeking increasingly profitable profits in partnership with “brokers” who identify and prey on future patients with insurance, with the goal of admitting those vulnerable people into their partner establishments, he said.
“There have been fraudulent illegal and unethical suppliers that have emerged, many of which emerged during the opioid epidemic, to take advantage of what they thought was the gold rush,” Poznanovich said.
The new United Health policy could actually benefit patients because it ensures they are seen only by providers who practice evidence-based treatments, which will ultimately reduce their care costs, Poznanovich said. Off-network facilities can be twice as expensive for payers and patients and result in care that is half as good as online providers, he said.
Like online providers for United Healthcare customers, Betty Ford substance use disorder rehabilitation clinics will benefit financially from the limitations of off-network coverage.
But by limiting patient choice, insurers could saddle patients with treatment bills that reach tens of thousands of dollars each week, said Caitlin Donovan, a spokeswoman for Washington’s National Patient Advocate Foundation. Invoices for out-of-network services tend to be higher than those patients submitted to the foundation for care, he said.
Surprising billing regulation is the real reason United Healthcare is taking out-of-network coverage, Donovan said. The rule bars limit billing for emergency services and prohibit out-of-network costs for ancillary services, such as those provided by anesthesiologists or surgical assistants, along with other out-of-network charges when patients are not. notify in advance.
“With this new law, if they didn’t have this policy in place, they would then have to go in and contract with those suppliers to come up with a reasonable fee,” Donovan said. “That could be the whole problem.”
The insurance giant has made larger investments in suppliers and technology with an eye towards cost control.
By the end of the year, UnitedHealthcare aims to employ 56,000 doctors, making it the nation’s largest medical employer. The company has also invested in Naviguard, which it describes as its own “conduct an offline offer” which employers can use to resolve disputes with suppliers. UnitedHealthcare has developed Naviguard as an internal replacement for MultiPlan, which is branded as a healthcare cost management company. MultiPlan is named in the Wit lawsuit because it works with UnitedHealthcare to cover patient claims at rates lower than the market.
United Healthcare’s new offline policy also allows it to put pressure on providers to join their networks and accept their reimbursement rates, said Adam Block, health economist and founder of New-based Charm Economics. York.
“Providers will be negotiating more online rather than using offline as a lever, because patients will no longer receive a benefit from being able to go offline, at least in some circumstances,” Block said.
The lines between self-insured and fully insured continue to blur as markets for them overlap. More smaller employers choose to insure, for example. Because of this, United Healthcare could face increasing pressure to reduce premiums for the two blocks of activities since the two types of plans are now in competition with each other, Block said. The growing number of insurtech startups in the individual market could also intensify United Healthcare’s focus on cost reduction, he said.
“There will be more competition,” Block said. “What that means is an organization like United has to work harder to maintain its business. That could be an answer to that.”