I have worked in health care for almost 40 years now. The first half working for health insurance companies and the last half working for physicians and hospitals. Over those four decades I’ve learned several “truisms” when it comes to the payers. One is that they love to “deny”. Deny care, deny claims, and when they can’t do that, reduce the amount they do have to pay. Another is that they can be very creative in coming up with new ways to accomplish this goal.
One of the new tactics being used by health insurance companies is automated down coding. Now if you aren’t in this industry let me explain how this works. Since I am a big fan of the series “The Pitt”, with its realistic portrayal of life in a busy ER and the dedicated professionals who spend their shift helping humanity when we need it most, I am going to use the show as an example.
Let’s say you find yourself brought into Dr. Robby’s ER in an ambulance. You are unconscious and Dr. Robby and his team meet you at the door. Very quickly the team assess you and starts ordering tests and imaging to figure out what’s going on. They don’t check your insurance or your ability to pay; they just get to work saving your life. After diagnosing your issue, they then move on to a course of treatment or referral to a specialist like a surgeon. This story is a happy one and the great Dr. Robby and his team address your problem, so you get to go home and live to see another day.
At this point most people not in this industry wouldn’t believe how little Dr. Robby and the other doctors that worked on you get paid for helping you. We all know that ER visits are expensive, but most people don’t realize that the doctors get very little of that money.
When you show up at an ER the doctor that treats you gets paid based on the level of severity that you presented with. There are five basic levels with Level 5 being the highest. In our scenario where you arrived in an ambulance and Dr. Robby had to run several tests and order imaging while making complex medical decisions before finally deciding on the right course of treatment, we’d most likely be looking at a Level 5 visit. While every health insurance contract is different, your insurance company is probably going to pay Dr. Robby and the other doctors who worked on you between $200 and $500 for saving your life. Think about that for a minute. The average plumber’s visit runs between $100 to $400 dollars. Now this is not a slight on plumbers, because I think their labor is worth a great deal. But if a plumber can charge $400, I don’t think it’s too much to ask that ER doctors get paid that much to save your life.
Ok, back to our scenario. You go home better and happy. Dr. Robby’s group bills your insurance company and waits for their payment. Instead of getting the $400, they are told by your insurance company that the claim has been “downcoded” to a Level 4 so the payment will only be $250. This is where things start to get bad.
The insurance company hasn’t looked at any medical records, they don’t know what Dr. Robby did to diagnose you or the medical decision-making that he went through to come up with your course of treatment. They don’t know how long he worked on you or how many other doctors were involved. All they know is that he billed a Level 5 and they don’t want to pay that much.
This tactic is a relatively new development. Several insurance companies have purchased some black box software that automatically downcodes some claims. They pay the lower amount and then tell Dr. Robby that he can appeal if he wants the extra $150. To appeal this decision, Dr. Robby must jump through a bunch of administrative hoops set up by the payer, submit his medical records and hope for the best. What’s that? Who is he appealing to? That’s a great question. Well, he submits the appeal to the very company that downcoded him in the first place. The insurance company “considers” the information that Dr. Robby presents and they decide if they are going to overturn their original decision. That’s right, the insurance company is judge, jury and executioner all rolled up in one.
Let’s leave our scenario with Dr. Robbie and talk about real life. I’ve been involved in several calls where hard working ER doctors have tried to get more information from insurance companies about why they are being downcoded. I have seen them ask for the criteria being used and the name of the software or vendor that is doing this. Those requests have been rejected. The insurance companies are about as transparent as a cinder block wall. I was on one call where they were looking at an actual patient chart. After going through the train wreck that was this patient the doctor asked the logical question; “how is this not a Level 5?” The response from the payer was, and I can’t make this stuff up, “well obviously the situation was not life threatening because the tests all came back negative”. I’m not clinical and even I know that is an incredibly stupid response.
If you haven’t watched The Pitt, I highly recommend it. It will give you a newfound respect for physicians and an understanding of how hard they work for us. It will also help explain the very real burnout that physicians face and why the suicide rate for doctors is twice the rate for the rest of the population. I just can’t imagine being Dr. Robby and coming off a shift only to be told that a nameless, faceless, for-profit insurance company that makes billions of dollars and pays their CEO $20 million a year has unilaterally decided that you billed them $150 more than you deserve when you saved that patient’s life. How do you not get burned out. How do you show up for the next shift?
I don’t understand why they do it or how they do it, but I am grateful for every “Dr. Robby” and every PA, nurse and team member in the ER for doing it every day. Thank you all!
To the insurance executives who came up with this idea or are implementing it, I want you to think about this for a minute. How would you feel if you or a loved one was brought to Dr. Robby’s ER and after a short time he came and told you that he would like to do more tests, but your insurance company is only going to pay for a Level 4 and so he has to stop and hope for the best? You would think that was outrageous and criminal and you would be right. Well, what you are doing is outrageous and should be criminal!