Emergency Physicians Among Those Charging Much More Than Medicare

January 30th, 2017

BALTIMORE – Emergency physicians are on the list of physicians most likely to charge more than four times what Medicare pays for similar services, according to a recent report.

As a result, a study in the Journal of the American Medical Association warns that you shouldn’t be shocked if other states or government entities join New York in restricting out-of-network physicians from charging patients much more than the amounts allowed by Medicare and most private insurance companies.

Researchers from the Johns Hopkins Bloomberg School of Public Health and the Johns Hopkins Carey Business School point out that privately insured consumers often are presented with surprise medical bills that are much higher than they anticipated.

The report notes that the average emergency physician, anesthesiologist, pathologist, and radiologist charge fees far higher than the norm for their services. Further complicating the issue is that physicians with the highest markups often are those patients don’t have an opportunity to choose, according to study authors.

According to the review, physicians with the highest markups are:

• anesthesiologists (charging 6 times what Medicare pays),
• interventional radiologists (4.5 times),
• emergency medicine physicians (4 times),
• pathologists (4 times),
• neurosurgeons (4 times), and
• diagnostic radiologists (3.8 times).

Specialties with the lowest markups, meanwhile, are internists, psychiatrists, and family physicians; those tend to be doctors with whom patients have ongoing relationships, according to the report.

“Many people are shocked two weeks or two months later when they get a bill from a doctor they didn’t really meet and no one told them what the exam would cost and later they discover the price is outrageous,” noted senior author Gerard F. Anderson, PhD, a professor in the Department of Health Policy and Management at the Bloomberg School. “But this is happening all the time.”

For the study, researchers analyzed the 2014 Medicare Provider Utilization and Payment Data, which includes more than 400,000 individual physicians in the United States, comparing physician charges to Medicare rates across medical specialties.

Results indicate that the average physician charged roughly 2.5 times what Medicare pays for the same service.

Study authors explain that, while the federal government determines what Medicare pays for certain services, out-of-network patients – along with the uninsured, and casualty and worker's compensation insurers – often pay the full charge, which can be as much as two to six times what Medicare and most privately insured in-network insurers will pay.

How much that can be varies regionally, the article adds, with physicians in Wisconsin, for example, having almost twice the markups of doctors in Michigan – 3.8 vs. 2. The study points out that, among the 10,730 physicians whose markups were among the top 2.5% of all physicians, 55% of them were anesthesiologists, and 32% of them were in 10 regions: Manhattan (NY), Houston (TX), East Long Island (NY), Dallas (TX), Milwaukee (WI), Atlanta (GA), Camden (NJ), Los Angeles (CA), Newark (NJ), and Charlotte (NC).

“Protecting patients from surprise medical bills from out-of-network physicians is an important issue in the ongoing national debate about the affordability of health care,” emphasized co-author Ge Bai, PhD, CPA, an assistant professor of accounting at the Carey Business School. “It is particularly frustrating for patients who deliberately select an in-network hospital and an in-network physician only to learn that one of their physicians was out of network long after the care was delivered.”

The authors called on Congress to require physicians to disclose their network status to each patient before delivering services and to improve price transparency by posting out-of-network prices.

They also pointed to state action, including New York, which, in 2015, enacted a law restricting the amount that out-of-network physicians could charge a patient. While 11 other states have limited the amount that can be charged by out-of-network physicians, most of the rules apply primarily to emergency care, according to the study.