Texas lawmakers on Monday vowed to crack down on the state’s booming free-standing emergency room industry in the wake of a troubling AARP Texas survey and a Houston Chronicle story that both showed how some facilities are sending confusing messages to patients.
The AARP Texas survey showed that 30 percent of the state’s 213 for-profit free-standing emergency rooms “appear to not comply fully with state disclosure laws,” according to findings presented at a state Senate committee meeting in Austin.
The statewide survey also found that 77 percent said they “take” or “accept” major health insurance plans but were actually outside the network for those plans. And when AARP asked the centers’ staff directly, less than half were able to answer a “yes” or “no” question about health plan coverage.
The survey was presented the same day the Houston Chronicle published a story about how 90 percent of the area’s 52 free-standing emergency rooms are outside the Blue Cross and Blue Shield of Texas network, leaving unsuspecting patients potentially vulnerable to enormous surprise medical bills. The story further said that while many of the Houston facilities prominently advertise on their websites they “accept” all major insurers, an admission that they are out of network can be more difficult to find.
The back-to-back revelations come 15 months after a Texas law went into effect that mandated that the facilities disclose declarations including that they are an emergency room and charge facility fees, inform patients what insurance plans they accept and if they are part of those insurance networks. They are also required to include the warning that a physician may bill separately from the facility.
Committee members on Monday voiced concern over the AARP findings and said they would consider stronger laws when the Legislature reconvenes Jan. 8.
“There was recognition that more needs to be done in both enforcing existing laws and to make new laws to protect consumers,” said Blake Hutson, associate state director of AARP Texas, who testified at the hearing. He added that many seemed surprised at the breadth of the problem.
“We need to do something about this,” state Sen. Judith Zaffirini, a Democrat from Laredo, said at the hearing.
Larry Taylor, a Republican senator from Friendswood, called the AARP findings disappointing and suggested getting tough.
“Send a letter that you get into compliance or we’re coming after you,” he suggested during testimony.
The Texas Association of Free-Standing Emergency Centers, the trade group for the facilities, said in a statement to the Houston Chronicle on Monday it “looks forward to working with AARP and other stakeholders during the 86th Legislative Session. In fact, leaders of the free-standing ER industry are already in touch with legislators about their desire to put into place a more robust set of best practices which will benefit Texas patients seeking emergency care.”
Health policy advocates say the stakes of network status are enormously high because if a provider is out of network, any portion of the billed charge not fully covered by insurance can be shifted to patients to make up the difference in a practice called balance billing. In-network providers are prohibited from balance billing.
The free-standing emergency room industry has argued that network status is not important in emergency situations because another piece of insurance law requires insurers to cover those at in-network benefit rates. Many of the facilities post such reassurance on their websites.
But consumer advocates and insurers warn that just covering at in-network rates may not pay the entire bill nor preclude a provider from later balance billing after the benefit is processed. It also does not protect patients if the visit is later determined not to be a true emergency.
On Monday, state Rep. Tom Oliverson, a Harris County Republican and anesthesiologist, who sponsored the bill last year that was supposed to bring consumer protection tweeted the Chronicle story along with the message “We need to solve out-of-network balance billing once and for all. I am committed to doing that.”