The policy is expected to increase the bad-debt financial burden on hospitals and affiliated physicians, a hospital advocate says.

June 7—By mid-summer, Anthem Blue Cross and Blue Shield (BCBS) plans in at least four states are expected to offer no payment for non-emergent use of the emergency department (ED).

BCBS Georgia individual-market plans on July 1 will become the newest group to implement the policy. Anthem added the policy for its Missouri plans on June 1 and for its Kentucky plans in late 2015. Meanwhile, New York plans have had a “similar program in place for several years,” said Gene Rodriguez, director of public relations for Anthem Inc.

“This is not a new area of focus for Anthem,” Rodriguez said in an email. “Our current effort to decrease inappropriate use of the emergency room [ER] is timely given our work over the past few years to improve access to care for non-emergency conditions and the increase we are seeing in the inappropriate use of the emergency room.”

Evidence of the uptick in ED visits for non-emergency treatment in recent years includes a 20 percent increase in overall ED visits since 2014, Rodriguez said, noting that “a large percentage of those visits were for non-emergency ailments.”

Since the policy was implemented in Kentucky, Anthem has seen a “reduction in members who had repeat avoidable ER claims. And we are seeing only a small percentage of claims being denied as unnecessary ER use cases,” Rodriguez said.

Other insurers are implementing “similar” plans, said Cathryn Donaldson, a spokeswoman for America’s Health Insurance Plans (AHIP). Specific figures on the extent of such policies were unavailable as of publication of this article.

The policy is a step beyond the increasingly common approach of payers to add greater cost sharing to try to discourage ED utilization, especially for repeat ED visits, according to Rachel Sokol, practice manager for Research at the Advisory Board.

“It’s obviously a big cost driver, and there’s a lot of what would be called ‘avoidable emergency room utilization’ in pretty much any emergency room scenario, so it’s understandable there’s a real focus on the unnecessary piece but to continue to allow access for appropriate utilization,” said Zach Hafner, national partner in Consulting at the Advisory Board.

But traditional responses to high ED utilization may not have been sufficient to change enrollee behavior. For instance, a January 2017 Blue Cross and Blue Shield Association (BCBSA) analysis noted its authors’ surprise that retail clinic use has remained a small share of healthcare utilization in recent years despite widely divergent costs from EDs. For instance, out-of-pocket costs to treat an upper respiratory condition averaged $41 at a retail clinic and $650 in an ED, the analysis noted. 

The BCBSA report also highlighted the utilization challenge, finding that the 2013-15 growth rate in ED visits was 35.8 percent. The analysis also concluded that as many as 29.8 percent of ED visits could potentially be treated in retail clinics.

Much of the increased ED utilization in recent years, Sokol observed, has come among those newly insured under the coverage expansions of the Affordable Care Act (ACA).

“The [ACA] exchange population tends to have higher-than-expected ED use just because that’s the avenue that they’re used to for receiving care after having been uninsured before,” Sokol said in an interview.

BCBS’s new policy of disallowing coverage of non-emergent  ED care likely reflects the organization’s increasing focus on individual products, such as Medicare Advantage plans, dual-eligible coverage, and ACA marketplace plans—some of which have greater ED utilization among enrollees compared with traditional commercial plans, according to Hafner. Hospitals may have contributed to ED overuse by building a growing number of free-standing EDs that attract non-emergent utilization that might otherwise have gone to lower-cost retail clinics.

Other insurers could follow Anthem’s lead. 

“Certainly, if Anthem is able to show reduced inappropriate ED use, plans are hungry for more tactical solutions than they hav e in this area,” Sokol said.

Implementation Challenges

Implementing such a policy is likely to face challenges, including explaining the policy to beneficiaries and educating  them about alternative sites of care, Sokol said.

“I don’t know that you can stem that type of use by patients—of the ED—just by saying, ‘We’re not going to pay for it,’” said Ethan James, executive vice president for the Georgia Hospital Association.

Enrollees thought to have used EDs for non-emergency ailments will have their claim reviewed against the prudent layperson standard for what entails an emergency, including consideration of presenting symptoms and the diagnosis.

Anthem plans each review the list of non-emergency conditions that would be better treated by a patient’s primary care doctor than in an ED and decide their own policies for which conditions to include based on their market, Rodriguez said.

“It’s mostly about educating consumers and making sure they understand that they have other options,” AHIP’s Donaldson said.

Anthem will provide a 24/7 nurse line and online tools to help members find other local care options. The insurer also has asked physicians in its Enhanced Personal Health Care program to offer extended office hours and follow-up for patients who have visited the ED.

The policy also is expected to create review challenges for providers.

“Some states have experimented with copays for emergency department visits for non-emergency situations and had trouble collecting them ex post or determining ex post whether the visit fell into that category or not,” said Katherine Baicker, professor of Health Economics at Harvard University. “They haven’t always been as effective at reducing inefficient use as people hoped.”

Alternatively, other payers and providers have had success with increasing the availability of lower-cost sites of care for enrollees, Baicker said in an interview.

Hospital Impact

The policy is expected to increase the bad-debt financial burden of such patients—including plan holders who are unaware of the policy before going to the ED—on hospitals and affiliated physicians, James said in an interview.

“When you see these folks denying coverage for claims, it will absolutely put the burden for that financial loss on the providers,” James said.

It’s not yet clear what financial impact the policy would have—or has had—on individual hospitals.

Hospitals acknowledge the policy is aimed at a real problem.

“We do have problems with overcrowding in the ER, oftentimes for non-emergent cases,” James said. “Because of the hospitals’ mission, we’re going to take care of those patients who walk through the door, and we’re going to take care of them before we ask about forms of payment.”

Exceptions to the Anthem policy include coverage of non-emergent ED visits for enrollees directed to the ED by another medical provider and for services provided to children younger than 14.


Rich Daly is a senior writer/editor in HFMA’s Washington, D.C., office. Follow Rich on Twitter: @rdalyhealthcare

Publication Date: Wednesday, June 07, 2017