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Followup On Fee-For-Appeal

I have tried to get a little more information about the new appeals process being put into place by the signatories to the Love Settlement (you can read details here) but I am still not clear on a few things.  I am told by someone who is heavily involved in this process in NC that the new fee-based reviews are “a great opportunity to physicians to address billing and coding issues which have not been addressed previously…” and I am trying hard to believe it.  I am still looking for some information, though, about a few things that don’t make sense to me.  Here is Susanne Madden’s list, which sums it up nicely for me:

…What isn’t captured in this blog post is the connection to the Thomas-Love settlement; the following day [Verden] picked up the same changes at Premera and BCBS of LA and figured out the connection. In all cases, these were not clearly identified as relating to Thomas Love. In the case of BCBS of NC, there is a notification under Provider ‘important news’ dated October 13, 2008, discussing Level I appeals (http://www.bcbsnc.com/providers/important-news/october13-2008.cfm) but no news was published regarding the roll out of Level II. Instead, if you click on the Appeals link in the left hand navigation bar, there a viewer will find information on Level I and Level II, still, no reference to Thomas Love.

That said, it does not diminish that this process creates a barrier to physicians appealing claims, rather than encouraging it. Granted, if there was only one appeals process before now, then a third party review is a good thing. However, reading through the new appeals process posted on the BCBS of NC site, three areas of concern stand out -

1. “A Physician, Physician Group, or Physician Organization is deemed to have exhausted BCBSNC’s Level I Post-Service Provider Appeal process if BCBSNC does not communicate a decision within thirty (30) calendar days of BCBSNC’s receipt of all documentation reasonably needed to make a determination the Level I Post-Service Provider Appeal”

There is now a reduced incentive for the plan to process Level I appeals. If they don’t bother going to the expense and simply run out the 30 days instead, then physicians have the option to go to the expense of level II, or not.

2. “There is a filing fee associated with all requests for a Level II Post-Service Provider Appeal”. For billing disputes, a minimum of $50 is required from physicians wishing to appeal claims (< $1000 in claims); if greater than $1000 the ‘Filing fee shall be equal to $50 plus 5% of the amount by which the amount in dispute exceeds $1000 but in no event shall the fee be greater than 50% of the cost of the review’ (the cost of which is, of course, unknown at the time of filing). For medical necessity disputes, it’s between $50 and $250.

Physicians now have to pay to have their appeals reviewed, and in the case of a billing reason, without the benefit of understanding how much it will even cost them to do so. I cannot see doctors being quick to adopt that process.

3. “For Level II Post-Service Provider Appeals related to Billing Disputes, the disputed amount must exceed $500.00″

What happens to claims in dispute for less than $500? Do those not matter? If you are a pediatrician or primary care physician, the majority of your denied claims are going to be well below that amount. Ten denied visits may only amount to $400 dollars worth in claims, but with the margins in primary care being so low it is critical that those doctors have a way to get these claims remediated.

Further complicating matters is that the new process is not being consistently applied across the plans. Some have different thresholds - BCBS of NC is $500, BCBS of LA mentions nothing regarding fees until you click through to the MES notice which mentions a fee but no specific rates are indicated on that notice.

It is stated that in the event the physician prevails, the fees will be refunded. However, there is such a poor job being done by plans to educate physicians on how policy changes are driving what gets paid and what doesn’t, that physicians are likely to appeal claims denied due to policy changes that they were unaware of and have those denials upheld at level II. When that is the case, all that needs to happen is a handful of physicians paying for those appeals and losing, in order for the rest of the physicians to decide that it is not the worth the expense because they too will likely lose.

Therefore, it is hard to understand how this Level II process helps physicians. To be truly helpful, there needs to be a mechanism through which physicians can appeal POLICY DECISIONS, not claims denials based on policy changes which will result in appeals being upheld at Level II as the denials are consistent per the policy changes issued by the plan.

So, Susanne and are stuck on the same point.  To me, it looks like the intent of this new process was good - let’s add a new level of appeal process to give providers more options - however, as is often the case with the inscos, their implementation is a different story.

Here are some softballs for those who understand and support this process: how are these new fees set?  Are the providers splitting the bill with the inscos to pay for the 3rd party review, or is the provider on the hook entirely?  If the provider wins the appeal, is the insco then paying the bill?  Is there any information about who actually makes up this new review board, the BDERB and who reviews them?  Where do these fees go - to the BDERB itself?  Was there a concern that too many providers would wish to use a third party resource and, therefore, a fee was necessary to keep the demand to only those charges that met a $500 threshold?

Tags: Insurance, Uncategorized, hmosettlements.com

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