Today, I would like you to put yourself in Carole Taylor’s shoes for a few minutes, even if just as you read this. Last week, Taylor rushed to Vanderbilt Medical Center in Nashville for a long-awaited double lung transplant, which her doctors told her not only was medically necessary but likely the only thing that would save her life.
I've worked in Health & SciComms for nearly 30 years. They 1000% knew what they were doing. People keep saying the system is broken, but it's not, it's working exactly how it was set up. And as long as politicians can take money from them, nothing is going to change. We need single payer in the U.S., but I don't expect to see it in my lifetime and I'm in my early 50s.
In these cases where transplants were cancelled because of denial of insurance after they were scheduled, the party that is first wrong is the hospital and medical providers. They are the one denying care, the insurance (as wrong as they are) is denying coverage. The medical providers have an obligation to provide medically necessary care, payment is second.
They also have access to vast resources that they could use to assure that the patient is not left with a bill - such as their obligations to provide charity care. Hospitals are spending less than 1% of their budgets giving charity care. Many are not even meeting the most basic of providing charity care which they are obligated to do. Most enjoy more tax benefits vastly in excess of the care they provide in charity.
They also know that the situations are so egregious that they will with get the insurance company to pay, or the publicity will generate an outpouring of public support., as to more than compensate them for the costs.
In my day as a health plan executive, I had a situation of an experimental procedure, at Philadelphia Childrens Hospital. The CFO was excellent to work with and we arranged coverage with price considerations. Subsequently he told me they sued all of the plans that had denied the same procedure on other insurance carriers and won. At no time did the patient become involved in my working this out, and I continue to respect the leadership at PCH.
Just to clarify, provides can still sue insurers successfully but just not patients and families? 🥺 As Mr. Potter explained “1970s federal law that makes it nearly impossible for a patient or a patient’s family to successfully sue a health insurer”
Speaking as a retired hospital pharmacist, I’ll add that we need to clearly distinguish between “costs” and “charges”. Determining actual costs is murky enough, but the charging structure is fantasyland.
This is America - you can sue anyone for anything. If the provider is contracted, then a breach of contract action is appropriate, as it would be with a patient. In my time running a health plan if I was not threatened with a lawsuit at least 3 times a week, it was a slow week. ERISA never stopped a committed litigant in my experience. (did it reduce frivolous cases, yes)
Now the question is who to sue, and for what. For patients that are directly contracted for their health benefits, there is one set of rules, and for those that are covered under employee benefit plans, there is another.
The Employee Retirement Security Act of 1974 (ERISA), is a complex federal law that regulates employee health care benefit and pension plans. ERISA is meant to protect private pension and health plans from fraud and mismanagement. Because the Act's regulations "preempt" similar or conflicting state or local laws, they sometimes deprive individuals of the much-needed protections provided by their state laws, including insurance "bad faith" laws that protect the consumer from unfair claim denials.
However, this means that some actions will have to be brought in federal court, and in most cases, states do have consumer protection laws and laws related to insurance offered in that state that provide avenues to redress grievances, allowing for actions in state courts. There does not seem to be a shortage of attorneys prepared to sue on a contingency fee basis.
Health plans do have appeal processes, and grievance processes, and in the more forward states have regulations that provide protections.
In these cases, what I find so objectionable is that the medical providers, immediately on a question of payment, choose to deny lifesaving medical care. Most often it is the not-for-profit hospital that is making that call, an institution that has been given oligarchy status by its license from the state (protecting them from competition), preferential tax treatment by the state(benefiting their bottom-line), the ability to ask and seek donations from the public under the guise of doing good for the community(a public benefit), preferred and higher reimbursements for their services (compared to community-based providers of the same) and yet they choose to deny medical care based on payment.
sorry, my clinical training was - provide the medically necessary care, and then deal with the economics.
Yes, we can sue anyone but fighting Goliath is not something most people can do financially or emotionally, particularly if they or a loved one is critically ill.
The surgeon though may have been offering false hope and an unadvisable procedure, another point of view: https://www.sensible-med.com/p/should-insurance-companies-pay-for "Lung transplants are a brutal procedure. Often they require lifelong immunosuppression (which can fuel cancer growth). The treatment has a known fatality rate, and quality of life after transplant can be bad. Median survival after lung transplants is less than a decade when done for non-cancer purposes. It is not clear that transplant will make this patient better off— it can even (and perhaps most likely will) hasten death.
"What the insurance company did wrong: Cigna initially offered to cover the procedure, then declined at the 11th hour, and now has decided to cover it again if the patient’s cancer is still not visible elsewhere on scans. Obviously, agreeing to covering it and backing out at the last minute is despicable behavior. Cigna acted poorly by flip flopping. They should have always said no."
I am not defending Cigna here. What they did was reprehensible in both of the cases cited, but I also wonder how it is that we have a system where the doctor's and hospital involved are themselves willing to tell the patient she can't have the transplant? UCLA medical system posted 1.5 billion dollars in revenue in the 2008-2009 fiscal year and carried a surplus of $100 million. Isn't it also abhorrent that the doctor's and hospitals involved, who are doing quite well for themselves, are also not stepping in to provide the service to save a life even when there is a question regarding insurance coverage? This is especially true that it may very well have been that in both cases, if you take Cigna's word for it, the denial was an "error" which could have meant the hospital could have been paid anyways.
Attorneys that work on contingency fees is an avenue to pursue. Further, most state's insurance commissioners have some jurisdiction as to intervening in egregious cases by plans in their state. There are also patient advocacy groups, often disease specific that have experience with payer in regard to their denials. Of course, the hospital could give an assist as they have direct contacts high up in the health plans to get attention for a patient of their facility, if they chose to. Remember hospitals as oligarchies have used their market leverage to gain preferred reimbursements and could use the same contacts to bring a legitimate abuse by a plan to a payer's executives, who generally don't like litigation, if they are not on solid ground. Of course there is always the public advocacy route as well.
Much of Cigna business is self-assured accounts. This means it is the employer who is designing the coverage, and Cigna's denial may be related to what the employer has set as the rules for coverage. The reason they denied the claim needs to be understood and addressed. If coverage, and the employer is self-insurance, that is on the employer. If it is a policy decision of medical necessity, then medical providers must stand up and defend their proposed treatment plan, even if it means putting the effort into gathering the supporting professional expert evidence.
Thank you, Wendell, for once again spotlighting the incredible greed of the private insurers and the outrageous lengths that they go to to kill the patient and pocket the profit.
I've worked in Health & SciComms for nearly 30 years. They 1000% knew what they were doing. People keep saying the system is broken, but it's not, it's working exactly how it was set up. And as long as politicians can take money from them, nothing is going to change. We need single payer in the U.S., but I don't expect to see it in my lifetime and I'm in my early 50s.
In these cases where transplants were cancelled because of denial of insurance after they were scheduled, the party that is first wrong is the hospital and medical providers. They are the one denying care, the insurance (as wrong as they are) is denying coverage. The medical providers have an obligation to provide medically necessary care, payment is second.
They also have access to vast resources that they could use to assure that the patient is not left with a bill - such as their obligations to provide charity care. Hospitals are spending less than 1% of their budgets giving charity care. Many are not even meeting the most basic of providing charity care which they are obligated to do. Most enjoy more tax benefits vastly in excess of the care they provide in charity.
They also know that the situations are so egregious that they will with get the insurance company to pay, or the publicity will generate an outpouring of public support., as to more than compensate them for the costs.
In my day as a health plan executive, I had a situation of an experimental procedure, at Philadelphia Childrens Hospital. The CFO was excellent to work with and we arranged coverage with price considerations. Subsequently he told me they sued all of the plans that had denied the same procedure on other insurance carriers and won. At no time did the patient become involved in my working this out, and I continue to respect the leadership at PCH.
Just to clarify, provides can still sue insurers successfully but just not patients and families? 🥺 As Mr. Potter explained “1970s federal law that makes it nearly impossible for a patient or a patient’s family to successfully sue a health insurer”
Thank you so much for sharing your amazing experience and insights! 🙏
Speaking as a retired hospital pharmacist, I’ll add that we need to clearly distinguish between “costs” and “charges”. Determining actual costs is murky enough, but the charging structure is fantasyland.
This is America - you can sue anyone for anything. If the provider is contracted, then a breach of contract action is appropriate, as it would be with a patient. In my time running a health plan if I was not threatened with a lawsuit at least 3 times a week, it was a slow week. ERISA never stopped a committed litigant in my experience. (did it reduce frivolous cases, yes)
Now the question is who to sue, and for what. For patients that are directly contracted for their health benefits, there is one set of rules, and for those that are covered under employee benefit plans, there is another.
The Employee Retirement Security Act of 1974 (ERISA), is a complex federal law that regulates employee health care benefit and pension plans. ERISA is meant to protect private pension and health plans from fraud and mismanagement. Because the Act's regulations "preempt" similar or conflicting state or local laws, they sometimes deprive individuals of the much-needed protections provided by their state laws, including insurance "bad faith" laws that protect the consumer from unfair claim denials.
However, this means that some actions will have to be brought in federal court, and in most cases, states do have consumer protection laws and laws related to insurance offered in that state that provide avenues to redress grievances, allowing for actions in state courts. There does not seem to be a shortage of attorneys prepared to sue on a contingency fee basis.
Health plans do have appeal processes, and grievance processes, and in the more forward states have regulations that provide protections.
In these cases, what I find so objectionable is that the medical providers, immediately on a question of payment, choose to deny lifesaving medical care. Most often it is the not-for-profit hospital that is making that call, an institution that has been given oligarchy status by its license from the state (protecting them from competition), preferential tax treatment by the state(benefiting their bottom-line), the ability to ask and seek donations from the public under the guise of doing good for the community(a public benefit), preferred and higher reimbursements for their services (compared to community-based providers of the same) and yet they choose to deny medical care based on payment.
sorry, my clinical training was - provide the medically necessary care, and then deal with the economics.
Its very expensive to sue considering you have a sick family member unable to work.
Yes, we can sue anyone but fighting Goliath is not something most people can do financially or emotionally, particularly if they or a loved one is critically ill.
The surgeon though may have been offering false hope and an unadvisable procedure, another point of view: https://www.sensible-med.com/p/should-insurance-companies-pay-for "Lung transplants are a brutal procedure. Often they require lifelong immunosuppression (which can fuel cancer growth). The treatment has a known fatality rate, and quality of life after transplant can be bad. Median survival after lung transplants is less than a decade when done for non-cancer purposes. It is not clear that transplant will make this patient better off— it can even (and perhaps most likely will) hasten death.
"What the insurance company did wrong: Cigna initially offered to cover the procedure, then declined at the 11th hour, and now has decided to cover it again if the patient’s cancer is still not visible elsewhere on scans. Obviously, agreeing to covering it and backing out at the last minute is despicable behavior. Cigna acted poorly by flip flopping. They should have always said no."
I am not defending Cigna here. What they did was reprehensible in both of the cases cited, but I also wonder how it is that we have a system where the doctor's and hospital involved are themselves willing to tell the patient she can't have the transplant? UCLA medical system posted 1.5 billion dollars in revenue in the 2008-2009 fiscal year and carried a surplus of $100 million. Isn't it also abhorrent that the doctor's and hospitals involved, who are doing quite well for themselves, are also not stepping in to provide the service to save a life even when there is a question regarding insurance coverage? This is especially true that it may very well have been that in both cases, if you take Cigna's word for it, the denial was an "error" which could have meant the hospital could have been paid anyways.
Attorneys that work on contingency fees is an avenue to pursue. Further, most state's insurance commissioners have some jurisdiction as to intervening in egregious cases by plans in their state. There are also patient advocacy groups, often disease specific that have experience with payer in regard to their denials. Of course, the hospital could give an assist as they have direct contacts high up in the health plans to get attention for a patient of their facility, if they chose to. Remember hospitals as oligarchies have used their market leverage to gain preferred reimbursements and could use the same contacts to bring a legitimate abuse by a plan to a payer's executives, who generally don't like litigation, if they are not on solid ground. Of course there is always the public advocacy route as well.
My son had a stroke and has non stop issues with getting paid by his insurance company for disability.
Just awful and to think we pay for this?
Cigna is really coming into light as the insurance company that simply denies claims until caught!
Much of Cigna business is self-assured accounts. This means it is the employer who is designing the coverage, and Cigna's denial may be related to what the employer has set as the rules for coverage. The reason they denied the claim needs to be understood and addressed. If coverage, and the employer is self-insurance, that is on the employer. If it is a policy decision of medical necessity, then medical providers must stand up and defend their proposed treatment plan, even if it means putting the effort into gathering the supporting professional expert evidence.
Thank you, Wendell, for once again spotlighting the incredible greed of the private insurers and the outrageous lengths that they go to to kill the patient and pocket the profit.