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Protecting Patient Access from Insurer Abuse

Today, the nation’s hospitals are facing billions of dollars in net losses, and more than half of all U.S. hospitals are expected to record negative margins for 2022. As a result, many rural hospitals are closing and others are being forced to lay off critically needed staff.

These factors are contributing to a dire health care worker shortage. In fact, America’s health care system is projected to suffer a shortage of 3.2 million workers by 2025. The worker shortage is having a direct impact on hospitals’ and clinicians’ ability to serve patients, and it is being exacerbated by an historic high in physician burnout. In 2021 alone, 333,000 health care providers – including 117,000 physicians – left the health care workforce.


Protecting Patient Access from Insurer Abuse

Many health plans, issuers, and third-party administrators (TPAs) are adding to the strain by engaging in abusive behavior. This behavior takes multiple forms, including but not limited to:

  • Threatening to terminate contracts and kick medical groups out of insurers’ networks unless the groups accept deep cuts to their contract fee schedules.

  • Blaming the No Surprises Act (NSA) for reimbursement cuts and contract terminations, noting they intend to use the law to drive down median rates in the state.

  • Cancelling contracts as NSA’s implementation approached and took place in order to use NSA as the basis for reducing physician reimbursement. 

  • Sending letters to medical practices saying they will terminate contracts unless physicians immediately agree to payment reductions from 10 percent to over 30 percent.

  • Failing to pay non-participating provider claims on a timely basis or at all, despite NSA’s requirement that clean claims be paid within 30 calendar days of receipt. 

  • Making physicians, other clinicians, and medical groups wait months between receipt of initial payment and “complete” payment. 

  • Calculating qualifying payment amounts (QPAs) that include “ghost rates” in order to reduce payments to impacted medical specialties. 

  • Reducing their out-of-network payment rates to physicians – in some instances by 100% or more – since implementation of the NSA.

  • Forcing medical practices and hospitals to terminate their contracts with insurers due to significant underpayment and lower reimbursement rates than those offered by Medicaid.

  • Refusing to extend negotiated fee schedules and instead insisting that medical groups accept lower rates, leading to a sharp drop in collections and compelling groups to terminate.

  • Deviating from longstanding practice by blocking medical networks from adding new groups to existing insurance contracts or making it much more difficult for them to do so.

  • Denying physician claims that include consultation codes as part of an industrywide coding change designed to cut physician reimbursement.

  • Down-coding physician services, without any basis or meaningful explanation, as a means to further cut reimbursement.

  • Using medical records requests as a condition to adjudicate a claim and issue payment which, in turn, have served to delay or avoid payment.

  • Imposing significantly longer wait times for credentialing and contracting, since implementation of the NSA.

  • Being less responsive to medical groups when approached about contract discussions, with many saying they will not negotiate rates at all and some not even returning the groups’ calls.  

  • Utilizing independent and distinct websites, rather than a consolidated document, for the delivery to non-participating providers of requisite information such as QPAs.  

  • Failing to utilize required remark codes on payments resulting in manual payor website reviews to determine claim eligibility, adding thousands of hours in administrative work to physicians.

  • Requiring manual entry of key claims details to initiate the IDR process, compelling physicians to spend thousands of hours on administrative work to appeal deeply reduced payments.


At the same time as they are withholding, reducing, and delaying payment for care, many health insurers are recording record-high corporate profits. Just as troubling, evidence is coming to light that some insurers are engaging in fraud and abuse of the Medicare Advantage program.

For all of these reasons, action is needed.
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