California ED physicians entitled to reasonable fees for services

A state appellate ruling is viewed by the medical community as putting out-of-network physicians in a better position to receive fair reimbursement for emergency care.

By Mike Norbut, AMNews staff. Aug. 15, 2005.

California physicians who do not have a contract with a health plan but provide emergency care to its members are entitled to reasonable fees and can take the insurer to court to receive them, according to a recent appellate court ruling.

The ruling, made last month by the California Court of Appeal's 2nd Appellate District, elicited praise from the physician community, which seems to have a constant tug-of-war with HMOs over the subject of fair reimbursement. The ruling reverses the action of the trial court, which threw out the original class-action lawsuit and said emergency physicians could only seek additional reimbursement for services directly from the patient or file a claim with the state's Dept. of Managed Health Care.

"This makes clear that a physician has a right to fair reimbursement, that health plans can't arbitrarily decide what a physician should receive," said Jack Lewin, MD, executive vice president and CEO of the California Medical Assn. "This really puts physicians, and to some extent the hospital, in a much more positive position for fair reimbursement."

In the original lawsuit, noncontracted emergency physicians claimed that Blue Cross of California underpaid, delayed payment, or simply did not pay some claims filed for the care of its members.

Blue Cross argued to the appellate court that since state laws do not tie reimbursement for emergency services to a specific benchmark, such as the Medicare fee schedule, the insurer should be free to select the rate at which it pays noncontracted physicians. The court, however, disagreed.