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Insurance & Benefits

United Healthcare Temporarily Reverses Policy Denying Non-Emergent ED Payments

Earlier this month, UnitedHealthcare announced that the company would retroactively deny reimbursement for some non-emergent claims. Now, it's changing its tune.
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The nation’s largest health insurer has changed its tune on a policy meant to address healthcare costs. Earlier this month, UnitedHealthcare announced that the company would retroactively deny reimbursement for claims treated by the emergency department and later determined non-emergent.

The policy was set to take effect on July 1, but earlier this week, UHC pivoted. “Based on feedback from our provider partners and discussions with medical societies, we have decided to delay the implementation of our emergency department policy until at least the end of the national public health emergency period,” UHC said via statement. “We will use this time to continue to educate consumers, customers, and providers on the new policy and help ensure that people visit an appropriate site of service for non-emergency care needs.”

With healthcare costs continually rising, payors have spotlighted emergency department fees as one of the avoidable costs. According to Agency for Healthcare Research and Quality data, emergency room usage increased in the U.S. more than general hospital inpatient usage. In 2018, nearly one in seven Americans had an ED expense. More than half of hospital inpatient stays included emergency services before admission. 

With healthcare spending expected to reach 20 percent of GDP within the next few years, insurers and employers alike are looking for ways to reduce spending. Payors are incentivizing lower-cost care, using narrow networks, and focusing on healthy lifestyle choices as part of the strategy to reduce expenses. Avoiding the emergency room unless necessary has also been an approach to cost-cutting. 

A UnitedHealth Group study from 2019 found that two-thirds of the 27 million hospital emergency room visits by privately insured individuals in the country are avoidable. These are often visits that include cough, flu, back pain, strep throat, or other non-emergent needs. 

These diagnoses are better suited for a primary care environment, but their average cost is $2,032 in an emergency department. A physician’s visit is around $167, and an urgent care visit is $193 on average. If all avoidable ED visits went to urgent or primary care, the study says it would save $32 billion across the healthcare system. 

The announcement was met with backlash from hospital leaders, who worried that it could make patients afraid to go to the emergency room when they actually needed it. “Patients are not medical experts and should not be expected to self-diagnose during what they believe is a medical emergency,” wrote American Hospital Association President and CEO Richard Pollack. “Threatening patients with a financial penalty for making the wrong decision could have a chilling effect on seeking emergency care. This is dangerous for patients’ health at any time, but is particularly unsafe in the midst of a public health emergency.”

Hospital representatives noted that diagnostic and lab tests are often necessary to determine the diagnosis. It isn’t always possible for the average person to know the best place for treatment. “We think this policy should be immediately reversed or patients might defer needed emergency treatment with serious medical consequences, have surprise financial out-of-pocket medical expenses, and it violates the spirit and intent of actions a prudent layperson would apply in an emergency situation,” DFW Hospital Council President and CEO Steve Love wrote in an email.

Thompson raised several questions about the policy. If UHC were to punish payors for avoidable emergency department use, were they ensuring that there were after-hour alternatives in network or making sure their members had a primary care provider. He also questioned whether cost savings from avoiding the ER would be passed along to consumers, noting that UnitedHealth Group earned a 35 percent year-over-year gain in operating profits in the first quarter of 2021, totaling $6.7 billion. 

The pandemic has already caused patients to make difficult decisions about their care, resulting in fewer 911 calls during the pandemic and an increase in the number of patients who died before EMS could arrive. The pandemic made many fear going to the hospital, and the results were deadly. An insurer refusing to pay for emergency fees if the medical issue ends up not being an emergency could have a similarly chilling effect on seeking care, Pollack says. “Individuals and families who purchase health insurance deserve reliable, worry-free coverage that meets their healthcare needs and complies with all applicable patient protection laws.”

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