AHA, CHA leaders fire back at emergency room cost op-ed

American Hospital Association CEO Rick Pollack and California Hospital Association CEO Carmela Coyle responded in a joint article to a recent op-ed that criticized emergency rooms as the main drivers of rising healthcare costs.

Glenn Melnick, PhD, published an op-ed in The New York Times Sept. 5 arguing that regulations requiring insurers to cover out-of-network emergency room visits has given hospitals unfair bargaining power in payer contracting and has allowed them to greatly increase the cost of care. He argued  that since insurers have to cover emergency care no matter the provider, providers leverage this to remain in network while also raising prices. Dr. Melnick said this dynamic has hurt patients because it forces insurers to raise premiums.

Mr. Pollack and Ms. Coyle argue that a misunderstanding by Dr. Melnick of what takes place between payers and providers  regarding the cost of emergency care has led to his "flawed conclusion."

"Government payers, Medicare and Medicaid, set how much hospitals are paid for emergency care — there is no negotiation," the authors write. "And the rates paid by governments are far below the actual cost of care. Private health insurance companies, however, negotiate whether they will contract with hospitals and the rates to be paid. And those rates typically take those government underpayments into account."

"Insurance companies, especially in California, have power and can, when they choose to, use it to save money by excluding certain hospitals from their networks of covered health care providers. That means when you need emergency care, no matter where you may be, it is not uncommon for that care to be provided out-of-network," they add.

Mr. Pollack and Ms. Coyle write that providers are committed to decreasing surprise medical bills for out-of-network patients, and point to the AHA and CHA's support of proposed legislation such as the National Association of Insurance Commissioners' Model Act.

This bill would increase consumer protections, "establish standards for the creation and maintenance of provider networks by health carriers and assure the adequacy, accessibility, transparency and quality of health care services offered under a network plan."

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