Some relief in sight for ED Catch-22
Crackdown on prior authorizations expected
Progress is slow and uncertain and subject to political machinations but there is "some hope of getting relief" from the Catch-22 that hospitals face in handling emergency patients, says Stephen A. Frew, a nationally known health care attorney who specializes in risk management.
The federal budget passed in August contains new rules for Medicare and Medicaid managed care plans that will result in more hospitals getting paid for emergency department (ED) visits for senior citizens, says Frew, of Frew Consulting Group Ltd. in Washington, DC. Legislation is pending in the House of Representatives that would extend the rules to all insurance plans.
Hospitals have faced an ongoing financial dilemma in their treatment of emergency patients, forced to choose between complying with federal COBRA regulations, which require medical screening of all ED patients, and following the rules of many managed care plans, which require prior authorization for ED visits and often try to divert patients to less expensive care in clinics and other health care sites. When hospitals follow federal regulations and screen patients, they usually are not paid by those managed care plans.
"The new rules will require ED visits to be paid by private Medicare and Medicaid managed care plans, and they may not require prior authorization for medical screening examinations and necessary stabilizing care," Frew says. Previously, the feds had issued advisory letters indicating that the plans were expected to pay regardless of authorization, but there wasn’t much pressure to comply, he adds.
The rules went into effect Oct. 1, 1997, for Medicaid managed care plans and will be effective June 1, 1998, for Medicare managed care plans, unless the renewal date for the plan comes before that date, says M.J. Fingland, director of public relations for the American College of Emergency Physicians, a strong supporter of what is known as the "prudent layperson" standard.
Under the provisions of the new laws, health plans are required to use the broad federal COBRA definitions of emergencies, applying those from the perspective of a "prudent layperson."
"This means that if a person with average knowledge of health and medicine could reasonably expect that their condition or severe pain might be serious enough to place their health in serious jeopardy or might cause serious impairment, their visit to the ED must be covered, even if the actual diagnosis later turns out to be something minor," Frew says.
Legislation known as the Carden Bill, officially named the "Access to Emergency Services Act of 1997," which would extend the new rules to all insurers, remains in a House committee, says Fingland. "It can come up again this session of Congress doesn’t end until December 1998. Everyone is hopeful."
The Carden Bill, sponsored by Reps. Ben Carden (D-MD) and Marge Roukema (R-NJ) and Sens. Bob Graham (D-FL) and John Chaffee (R-RI), most significantly would bring ERISA plans (those of large self-insured companies such as IBM and Coca-Cola) under the prudent layperson standard, Fingland notes. The ERISA plans are not subject to state law, however, so even if the states where the companies with ERISA plans are located had passed such legislation, these insurers would not be bound by it.
The prudent layperson standard has been endorsed by some managed care plans, Fingland notes, including Kaiser Permanente in Oakland, CA; Health Insurance Plans in New York City; and the Group Health Cooperative of Puget Sound in Seattle.
Meanwhile, Frew says he has been told to expect changes in early 1998 in federal COBRA enforcement guidelines that will say specifically that a prior authorization requirement from a managed care plan violates COBRA. At present, the prior authorization issue had been "iffy," he explains.
"You could get [the prior authorization], as long as it didn’t delay treatment." But the issue has become so universally problematic that the feds are expected to say prior authorization "is a violation, period," he says.
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