Out of network fees cheat consumers

Syracuse University is in the forefront of fixing this injustice (which is shocking, but somehow not surprising), however, I've heard nothing about this on CNN or other news (Larry's dad told me about it). Odd, since it seems important.

Syracuse University will play a leading role in reforming a financial trap in the U.S. health insurance system that may be costing consumers millions of dollars.

A new nonprofit company is being set up at SU to create a database that will determine how much insurance companies nationwide must pay when patients see doctors who do not have contracts with the insurers. It also will create a Web site where consumers can easily get this payment information in advance, something they cannot do now.

The new database will replace a system state Attorney General Andrew Cuomo says is rigged to benefit insurers and leave consumers with unexpected, excessively high medical bills.

Cuomo was in Syracuse Tuesday to announce the creation of FAIR Health Inc., a nonprofit at SU that will be funded with about $100 million his office has obtained in settlements since January with 13 health insurers, including Excellus. That nonprofit is being established to fix health insurance reimbursement problems uncovered as part of a lengthy investigation by Cuomo’s office.That investigation found health insurers determine payment rates for doctors who don’t have contracts with them — known as out-of-network doctors — by using data supplied by Ingenix, a subsidiary of UnitedHealth, the nation’s second biggest insurer. Cuomo said Ingenix had a vested interest in setting rates low so companies could underpay patients for out-of-network services.

About 70 percent of U.S. families with health insurance have plans that allow them to visit out-of-network doctors. When they use those doctors, patients are responsible to pay the portion of the bill not paid by insurers. Patients often go out of network when they seek the services of out-of-town specialists.

In New York, Cuomo’s investigation showed consumers were underpaid by as much as 28 percent. As part of the settlements, the insurers agreed to stop using Ingenix and use the new system that will be established at SU.“I believe these health insurance companies have unjustly earned hundreds of millions of dollars under-reimbursing consumers,” Cuomo said. He said his office is suing the insurers to get them to refund money to consumers.