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Protecting and Preserving Health Benefits for NY State Residents


HealthCare PAC

New York Times Article Describes Deceptive Insurer Payment Practices

“Insurers Alter Cost Formula:  Patients Pay,” an April 24, 2012 New York Times article by reporter Nina Bernstein, describes how large insurers have switched to a new payment method that significantly increases health care costs to patients.  Consumers are paying more despite the companies’ settling a suit in 2009 brought by the State of New York that charged they manipulated pricing data to avoid providing fair reimbursement.  The settlement required insurers to pay $95 million to establish “FAIR Health,” a national database of doctor’s fees that both consumers and insurers can access. 


The article describes a new payment methodology used by many insurers, which is based on Medicare rates. Benjamin M. Lawsky, superintendent of the New York State Department of Financial Services, which regulates insurance companies, states that consumers are not getting what they believe they have purchased when they buy medical policies that provide “out-of-network” benefits.  The Department recently conducted an investigation that found 4.7 million New Yorkers, representing 76 percent of those with out-of-network coverage, face reimbursement reductions of 50 percent or more under these new health plans. 


The article includes a chart that illustrates significant disparities between the FAIR Health “usual and customary” benchmarks and the Medicare-based benchmarks now in use,  representing thousands of dollars in patient out-of-pocket costs for common medical procedures.  The article also describes Mr. Lawsky’s support for new legislation to require that minimum reimbursements be tied to the FAIR Health database, and to discuss cases in which patients were hit with major unexpected costs.


To read the article, follow this link: http://tinyurl.com/7ygp33f  




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