Louisiana s Billing and Disclosure Act & the Medical Lien Statute

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1 Louisiana s Billing and Disclosure Act & the Medical Lien Statute Stephen J. Buccola, Esq. Supervising Attorney RevClaims, LLC 2016 RevClaims, LLC. All rights reserved.

2 Introduction Overview of Topics Medical Lien Statute (La. R.S. 9:4752) Billing and Disclosures Act of 2003 (La. R.S. 22:1874) Discuss interplay between these statutes Discuss application of these statutes to providers Evaluate practices to minimize exposure to litigation

3 Identifying Encounters The 5% Third party liability claims (MVA, Slip/Fall, Workers Comp) make up about 5% of all provider claims However, this 5% is the last place to achieve 100% recovery and can have a significant impact on budgeting and allocations

4 Identifying Encounters Types of Encounters Affected Primarily motor vehicle accidents (MVAs) Also includes slip and falls and general premises liability NOTE: Workers Compensation is not applicable

5 Identifying Encounters Methods to Identify Encounters Registration is the best way E.g. EPIC registration prompts Accident Related Y/N ICD-10 Filters DX Code

6 Louisiana Medical Lien Statute La. R.S. 9:4752 A health care provider, hospital, or ambulance service that furnishes services or supplies to any injured person shall have a privilege for the reasonable charges or fees of such health care provider, hospital, or ambulance service on the net amount payable to the injured person, his heirs, or legal representatives, out of the total amount of any recovery or sum had, collected, or to be collected, whether by judgment or by settlement or compromise, from another person on account of such injuries, and on the net amount payable by any insurance company under any contract providing for indemnity or compensation to the injured person. The privilege of an attorney shall have precedence over the privilege created under this Section.

7 Louisiana Medical Lien Statute La. R.S. 9:4752 What is it? Statutory right of a medical provider to lien charges associated with treatment for an accident claim What does it cover? Net amount payable to the injured person [or representative] out of the total amount of any recovery collected... under any contract providing for indemnity or compensation to the injured person. E.g. insurance / settlement money

8 Louisiana Medical Lien Statute La. R.S. 9:4752 Procedure to Secure Lien Must be delivered by certified mail, return receipt requested, prior to payment of money Name and address of patient Name and address of provider Sent to the alleged liable party, patient s attorney, patient, and any insurance carrier who may cover a party Once secured, the recipient is on notice and required to protect the provider s interest

9 Louisiana Medical Lien Statute La. R.S. 9:4752 Practical Application How does it work? Once lien sent, recipient on notice of the lien Receiving party must, by law, protect provider s interest List name of provider on payment Payment made directly to provider Lien Impairments If payment sent without honoring lien, payee is responsible for reasonable charges up to the amount of the payment issued. E.g. - If lien is for $1,000 and insurance pays $800 to patient, insurance is liable to provider for $800

10 Louisiana Medical Lien Statute La. R.S. 9:4752 NOTE: the Medical Lien Statute does not apply to Workers Compensation accidents!

11 Louisiana Medical Lien Statute La. R.S. 9:4752 Example #1 of Medical Lien at Work Patient is involved in motor vehicle accident with another car. Patient provides their insurance carrier (State Farm) and other vehicle s insurance carrier (Allstate). A lien can be sent to both State Farm and Allstate to cover cost of treatment

12 Louisiana Medical Lien Statute La. R.S. 9:4752 Example #2 of Medical Lien at Work Patient is involved in motor vehicle accident with another car. Patient calls hospital to say she has hired an attorney to represent her. A lien can be sent to the attorney to cover cost of treatment

13 Health Care Consumer Billing & Disclosure Act of 2003 La. R.S. 22:1874 History Passed in 2003 to combat concerns of improper billing practices Designed to require providers to honor insurance contracts as primary Who does it apply to? A contracted health care provider A health care provider that has entered into a contract or agreement directly with a health insurance insurer or with a health insurance insurer through a network of providers for the provision of covered health care services. Hospital contract will govern. E.g., hospital ER, physicians, ambulance, rehab, etc.

14 Health Care Consumer Billing & Disclosure Act of 2003 La. R.S. 22:1874 Improper Billing Practices Prohibited: Discount Billing collecting from a beneficiary an amount in excess of the contracted reimbursement rate for covered services Dual Billing collecting from a beneficiary an amount that is a health insurer s liability Any amount in excess of the contracted reimbursement rate for covered health care services ***Collectively known as balance billing

15 Health Care Consumer Billing & Disclosure Act of 2003 La. R.S. 22:1874 What is not prohibited? Copayments Deductibles Coinsurance Payment for non-covered or non-contracted health care services Other amounts identified by the health insurance insurer as the liability of the enrollee

16 Health Care Consumer Billing & Disclosure Act of 2003 La. R.S. 22:1874 Scenario #1 Total charges: $10, Insurance Payment: $4, Insurance Adjustment: $6, Balance $0.00

17 Health Care Consumer Billing & Disclosure Act of 2003 La. R.S. 22:1874 Example of balance billing Total charges: $10, Insurance Payment: $4, Insurance Adjustment: $6, Insurance Adjustment: ($6,000.00) Patient Balance $6,000.00

18 Health Care Consumer Billing & Disclosure Act of 2003 La. R.S. 22:1874 Scenario #2 Total charges: $10, Insurance Payment: $4, Insurance Adjustment: $5,000.00* Balance $1, *Insurance EOB lists copay of $1, A lien can be sent for $1,000.

19 Health Care Consumer Billing & Disclosure Act of 2003 La. R.S. 22:1874 What about government plans? Title 22 does not apply to Medicare (federal law) Title 22 does not apply to Medicaid (state law) La. Admin. Code 50:8343 requires Medicaid to be a payor of last resort Title 22 does not apply to Tricare (federal law) Title 22 does not apply to VA (federal law) What about self-funded plans? Treat as managed care When in doubt, bill it out!!!

20 Health Care Consumer Billing & Disclosure Act of 2003 La. R.S. 22:1874 EOB is KEY!

21 Legal Problems Emerge Can a provider file a lien for full charges if the patient has private health? Attorney General Opinion in 2005 said yes A.G. stated the filing of a lien did not violate Title 22 because the lien acts as a security device

22 The Storm Begins How does the lien law apply when patients have private insurance? Under Title 22, a patient s private health insurance must be billed Desselle v. Acadian Ambulance Services, Inc. (2012) Ambulance refused to bill private health insurance and would pursue full charges against automobile insurance Court found this practice to violate Title 22 $17 MILLION DOLLAR VERDICT

23 The Anderson Decision Anderson v. Ochsner Health System (2014) Pt Anderson involved in MVA Insured by UnitedHealthcare At the time of accident, hospital had contract with UHC Patient presented UHC cards at registration Hospital sent lien for full charges to Anderson s attorney and did not ( refused ) bill UHC

24 The Anderson Decision Court s major holding: Title 22 provides a private right of action for a patient to bring a lawsuit against a provider Supreme Court also found that the mere filing of a lien constituted an action at law against a patient Recall: the Consumer Billing and Disclosure Act prohibits maintaining an action at law against an enrollee Why? Because legal consequences attach when the lien is ignored

25 The Anderson Decision So what does Anderson mean for providers? First, a violation of the Billing and Disclosure Act can be brought by any patient Second, the filing of a lien is considered an action at law against an enrollee Third, providers who followed the practices indicated by the Attorney General are now exposed to potential litigation!

26 Effects of Anderson: The Litigation Storm Big Question Remains What can providers do to create financial security while remaining compliant with Title 22?

27 Effects of Anderson: The Litigation Storm Let s review what has been established: Title 9 provides a medical lien for providers Title 22 requires providers to bill private health first and not improperly pursue a patient for more than contract rates Filing a lien for full charges / not billing health is a violation of Title 22

28 Billing Options for Providers 1. Forego filing of a lien altogether Ultra-conservative option However, provider abandons ability to secure recovery of coinsurance, copays, deductibles, or non-covered charges

29 Billing Options for Providers 2. File lien for expected contract amount Most-risky option Requires a provider to make an early estimation of expected reimbursement rate *** This theory has not been evaluated by the courts and may subject a provider to litigation

30 Billing Options for Providers 3. Delay filing of lien Wait until insurance has paid and file the lien for the copay/coins/denied amount EOB is key Most safe option, subject to limitations Delays for medpay Settlement prior to lien Requires oversite to insure correct values are listed

31 Conclusion While the provider lien statute is a great tool, proactive steps should be taken to ensure compliance within Title 22. Contact Information: Stephen J. Buccola sbuccola@revclaims.com P: F: