Fine Print Excludes Outpatient Surgeries in Some Work-Based Plans

Kaiser Health News reported today that the fine print in some work-based health plans exclude paying for outpatient surgeries.

As reported by Jay Hancock, Libbi Stovall, who lives in Carrollton, Texas was shocked to learn that her employer’s 2016 health plan provides no coverage for outpatient surgery.

Stovall, who has a history of back problems, looked at the fine print of her company’s health plan, which supposedly met the strictest standards for employer obligations under federal rules.

Inpatient hospital care, office visits and diagnostic imaging are paid for by her insurance, but it provides not coverage for outpatient surgery; surgeries that account for two out of every three operations in the nation.

Yet, being offered such a plan through her employer, she is barred from federal subsidies to buy more comprehensive coverage on the online marketplace by a company called Open Systems Technologies.

According to Hancock, Stovall’s experience illustrates the latest chapter in the story of employers and insurance designers pushing the limits of the ACA.

Last year, Hancock writes, regulators blocked companies with millions of lower-wage workers from claiming that coverage with no inpatient hospital benefits met the ACA’s strictest standard for large employers.

So-called “skinny plans” are no longer allowed, says Hancock, and therefore insurance administrators and many cost-conscious employers are claiming to meet the rules with a new version that excludes outpatient surgery. Hancock goes on to say that the new plans may not survive regulatory scrutiny any more than the old ones did, according to some experts.

Timothy Jost, a law professor at Washington and Lee University said, “I really wonder whether they can do that.” He added, “Refusing to cover any outpatient physician surgical services is arguably a violation.”

Outpatient surgeries such as hernia repairs, knee arthroscopies and repairing bone fractures are typical of those without an overnight hospital stay. They generally cost less than inpatient operations, Hancock writes, but can still be tens of thousands of dollars.

Leaving these procedures out of a plan saves money for the employer, Hancock states, but it leaves the workers with crippling bills.

The article goes on to discuss in length the way the new rules affect lower-wage workers and how their employers are responding to them.

It is not known what Ms. Stovall’s job is, or how she developed back problems, but for millions of lower-wage workers like her, the rules surrounding the implementation of the ACA means that their employers are sacrificing their health to save money on an already expensive health care system, instead of seeking out other alternatives.

These are the very kind of workers, a woman I had a Skype call with this morning, is trying to help with her company, Trip4Care.

Her name is Maria Maldonado, and she told me about a construction worker who needed double knee replacement, but his union-based insurance deductible was $40,000 and he waited five years before he got the surgery at hospital in Colombia that Maria vetted and sent him to.

I have written before about how medical travel can save money, not only under group health, but especially under workers’ compensation. And since many of the outpatient surgeries these work-based health plans have excluded are common in workers’ comp, it would make sense to tear down the walls between the two silos of group health and workers’ comp, and explore these opportunities to save huge amounts of money on medical bills.

But as long as people discount the validity of going abroad, as long as people in certain industries refuse to admit that not only is the cost lower abroad, but the quality too is better, when you go through someone like Maria Maldonado.

It is my intention to work with Maria to do just that. She has some possibilities that may require my expertise in workers’ comp, while she handles the group health side. If you are an employer who wants to save money on health care costs, contact me and we will work with you.

Otherwise, you will leave your workforce to the mercy of these rather draconian and capricious rules and cause pain and suffering to millions of lower-wage workers. ProPublica/NPR has shown this to be true, but it does not have to be so.

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4 thoughts on “Fine Print Excludes Outpatient Surgeries in Some Work-Based Plans

  1. Patrick Pine

    Just a note to be sure that the exclusion may apply to outpatient surgery centers that are out of network – not to all outpatient surgery.

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    Reply

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