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Reporting on surprise medical bills leads Mississippi hospital to change its ER billing policy Date: 06/26/18

Anna Wolfe

By Anna Wolfe

Batson Children’s Hospital has been charging patients thousands of dollars in unreasonable emergency room facility fees that do not match the level of care received. The hospital is part of the University of Mississippi Medical Center, the only academic medical center in the state.

As a result of complaints from patients and my own reporting for the Mississippi Clarion Ledger on how these high charges are calculated, the hospital changed its billing policies to make the charges more fair. Even with these changes, the current scoring methodology makes it impossible for anyone visiting the ER to receive a facility fee under “level 3,” which is over $2,000.

Depending on the severity of the medical problem and complexity of the services delivered, hospitals typically charge one of five facility fees for emergency room visits. Facility fees are tacked on to ER bills: Level 1 is the lowest and level 5 is highest.

UMMC uses a point system to determine which “level” to assign for each visit. The patient I interviewed, Amy McIntosh, was charged over $4,500 for what amounted to a check-up. She had five minutes of time face-to-face with a physician and no new treatment. The hospital charged a facility fee of 12 times the price Medicare would have paid for the same service.

It took McIntosh months to get an explanation on how her visit was assigned a level 4 facility fee, because the information is not included on the initial or itemized bills.

After my first story published in April, Guy Giesecke, the CEO of Batson Children’s Hospital, admitted the billing policies were unfair.

UMMC is not unique in its facility fee billing. Nationally, hospitals are charging patients for level 4 and 5 visits more and more often, creating suspicions of upcoding. Upcoding is illegal and happens when a hospital, physician or other provider bills an insurance company or Medicare or Medicaid or other payer using a code for a more expensive service than the provider delivered. Vox and the nonprofit Health Care Cost Institute also reported last year that facility fees rose 89 percent from 2009 to 2015, twice as fast as the price of outpatient health care, and four times as fast as overall health care spending.

My goal in continuing to cover this story was to examine ER facility fees, and whether the “levels” assigned matched the level of care received.

There aren’t any guidelines for hospitals to follow on how to determine which “level” to bill, so reporters should look at whether hospitals are increasingly billing for more severe visits, even if the medical problems in question don’t warrant such designations.

In Mississippi, the parents of babies seen for swollen lymph nodes or cradle cap, for example, were hit with $4,328 charges for the use of the Batson Children’s Hospital ER alone, not including physician fees, additional tests or treatments.

Because the facility fee is one lump sum that corresponds to the visit level, I found it cannot be itemized. That means it is indecipherable to anyone who doesn’t know the methods hospitals use to calculate ER bills.

UMMC lists the prices associated with each ER visit level on its website. But without an understanding of the point system underlying the levels, it’s impossible to predict how much a visit for any specific medical problem may cost — even if the level of severity seems obvious.

In response to her official complaint, McIntosh eventually received a letter from the Office of Patient Experience saying her bill was calculated based on a point system that awarded the visit 25 points: 10 points because McIntosh’s child was under 1-year-old, five points because the baby was given a Glasgow Coma Scale (GCS) test, five points for initial vitals and five points for discharge. Anything between 21 and 35 points, the letter said, is considered a level 4 visit, the second highest designation.

On his portion of the bill, however, the physician who saw McIntosh’s daughter listed the visit as level 1.

After McIntosh and I spoke, I asked UMMC why its calculation resulted in a level 4 designation when the physician considered the visit of the lowest severity. McIntosh also sent a letter to the Batson Children’s Hospital CEO expressing frustration.

Batson said it would make at least one immediate change: the 10-point age rule would be reserved for patients under six months old, instead of under 1-year-old. The hospital also promised to study the policy to identify any other necessary changes to match charges more appropriately with the level of care delivered.

UMMC would not share the full scoring methodology with the Clarion Ledger.

Because hospitals aim to keep these calculations secret, patients are instrumental in exposing the billing practices by sharing their own experiences. That’s one of the lessons I learned from working on these stories: Patients are an invaluable resource. Without them, I would have nothing to question. Also, patient advocates have been helpful, and perhaps the best source for these stories has been the state insurance commissioner.

Here is a list of articles published on medical bills:

Anna Wolfe covers health care for the Mississippi Clarion Ledger.