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Powers Wins Federal Court Decision for Emergency Physicians

By September 5, 2017No Comments

A federal district court in the District of Columbia has ruled that the federal government did not adequately respond to concerns from the American College of Emergency Physicians about a regulation governing payment for emergency services.

The case, American College of Emergency Physicians v. Price, No. 16-cv-913, began in May 2016 when ACEP sued the federal government to challenge a regulation that prevents emergency physicians from receiving reasonable payment for out-of-network services. Powers Principal Ron Connelly, Principal Rob Portman and Associate Leela Baggett represented ACEP.

The Affordable Care Act forbids commercial insurers from charging patients higher copayment or coinsurance rates for out-of-network emergency services than for in-network services.  The government interpreted this to require a reasonable payment to emergency providers for out-of-network services to ensure that patients will not be subject to excessive cost sharing.  The government issued a regulation, commonly known as the “greatest-of-three” or “GOT” regulation, mandating that insurers pay for out-of-network emergency services at the highest of the Medicare rate, the insurer’s in-network rate, or the usual, customary, and reasonable (UCR) rate.

ACEP supported the ACA provision and was generally in favor of the GOT methodology.  ACEP was concerned that the government did not require insurers to disclose how the UCR amount is calculated and that insurers were likely to manipulate the rate downward.  Because the UCR is generally higher than the Medicare or in-network rate, any misrepresentation of the UCR rate would drive down payments to emergency physicians.  In practice, many physicians have seen payments fall since the GOT regulation came into effect.

Before the district court, ACEP argued that the government ignored these concerns, and the court agreed.  On August 31, 2017, the court remanded to the three agencies that promulgated the rule and ordered them to provide a meaningful response.  The court has retained jurisdiction, and, depending upon the result on remand, may later consider ACEP’s arguments that the regulation does not adequately fulfil the statutory purpose of ensuring a reasonable payment for out-of-network services unless the UCR rate is subject to verification.

Click here to read the opinion. For more information, please contact Ron Connelly at 202-872-6762 or Ron.Connelly@powerslaw.com; Rob Portman at 202-872-6756 or Rob.Portman@powerslaw.com; or Leela Baggett at 202-872-6742 or Leela.Baggett@powerslaw.com.

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