California's high court ruled that emergency-room patients can no longer be billed by doctors and hospitals for care that isn't fully paid by their health plans.
The court on Thursday struck down a practice known as "balance billing," in which doctors and hospitals seek to collect from patients any amounts that their managed-care plans refuse to pay. Instead, the providers must either absorb the costs themselves, or get the insurance companies to pay.
Balance billing is controversial because patients are sometimes hit with emergency-room bills because they go to the nearest hospital or other medical facility regardless of whether it accepts their insurance. Health-care providers argue that they need some way to guarantee that they can be paid for their services.
In its decision, the California Supreme Court overturned a lower-court ruling and found that billing disputes over emergency medical care must be resolved solely between providers and health plans.
Connecticut, Pennsylvania and Alabama also have banned balance billing, according to the California Department of Managed Health Care.
As a result of this ruling, an Emergency Physician
1) cannot refuse to see a patient
2) cannot bill the patient directly
3) must either work out a contract with the insurance company ahead of time or sue the company for the difference between bill and payment.
3a) has no bargining power with the insurance company
3aa) The costs of a lawsuit will far outstrip whatever payment is owed.
Now balance billing isnt the greatest practice in the world. <s>A patient going to the emergency room</s> Some patients going to the emergency room really do not have the time to search around for a doctor who accepts their insurance or a hospital that is "in network." I can ask a plumber for a quote on how much a repair will cost, but I cant exactly ask the same from an EP.
However, this puts doctors in the unenviable situation of having nobody to bill for their services. Sure, they can bill the insurance companies (who use fraud to lower payments) but as mentioned above, they have no barginging power at all. (And no, the large majority of doctors, since they are technically all independant contractors cannot unionize due to anti-collusion laws)
How can this problem be fixed?