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State Supreme Court Outlaws Balance Billing
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State Supreme Court Outlaws Balance Billing,
    Increases Burden on Stressed ER System

The California State Supreme Court on Thursday struck down the practice of “balance billing,” forcing physicians and hospitals to eat the cost of emergency medical care that HMOs refuse to cover.

When HMOs don’t pay the full cost of ER care for their policyholders – a growing trend – doctors must bill for the outstanding balance, creating an awful burden for both physician and patient. The practice is known as balance billing.

CMA supports a solution that protects doctors and patients by requiring HMOs to pay the bill for emergency services. By outlawing balance billing without a realistic remedy, however, the court has placed another strain on financially struggling emergency rooms and the physicians who work there.

“As a trauma surgeon, my number one priority is to save lives and protect the health of my patients,” said CMA President Dev A. GnanaDev, M.D. “This court ruling basically says if I do my job as I see fit and HMOs don’t want to pay, tough luck, go to court. I signed up to be a doctor, not a lawyer.”

The court’s failure to solve the underpayment problem will stress the already beleaguered emergency care system. More than 70 California ERs have closed since 1990. In addition, the state’s emergency rooms performed more than $1 billion in uncompensated care in the year ending June 30, 2007, the most recent statistics available, according to the Office of Statewide Health Planning and Development.

“There is no doubt this ruling adds to the growing woes of California’s emergency rooms,” Dr. GnanaDev said. “Sadly, this will reduce the availability of emergency care throughout the state.”

CMA is exploring all of its options to ensure physicians have adequate recourse when HMOs fail to pay reasonably for emergency services. Organized medicine remains steadfast in its efforts to ensure that noncontracted physicians are properly paid for services provided to patients. To assist in these efforts, CMA will be distributing a survey this week on the issue of underpayment for out-of-network services. All physicians are urged to complete the survey as soon as possible.

Click here for more information, including a copy of the ruling and a link to the survey when it becomes available

Contact: 800/786-4CMA (4262) or info@cmanet.org.

Information Source: CMA Alerts