Insurance Coverage Expanded for Urgent Out-of-Network Care

TL/DR –

The strain on Massachusetts hospitals caused by workforce shortages and the bankruptcy of Steward Health Care, the largest for-profit hospital system in the country, has led to state regulators encouraging patients to use urgent care centers for less-severe medical emergencies. The agreement is expected to reduce overcrowding and longer waiting times in Emergency Rooms (ERs), particularly during the busy summer months. Urgent care centers will be reimbursed at 135% of the Medicare rate for out-of-network care, and it is estimated that 13-27% of ER visits could be handled elsewhere at a lower cost.

Massachusetts Hospitals Face Unprecedented Strains Amid Steward Health Care Decline

With summer being the busiest time for emergency rooms (ERs), Massachusetts hospitals are under strain, worsened by workforce shortages from the pandemic and issues with Steward Health Care – one of the country’s largest for-profit hospital systems. Steward, which operates seven hospitals in the state, declared bankruptcy in May, curtailing some services.

Michael Caljouw, vice president of government and regulatory affairs for Massachusetts’s largest private insurer, Blue Cross Blue Shield, noted the strain on the ER ecosystem. Urgent care centers, less equipped for severe emergencies than ERs, are becoming an important part of the care system. Insurers plan to pay 135 percent of the Medicare reimbursement rate for out-of-network care at urgent care centers in nine counties, he added.

Massachusetts has about 200 urgent care centers, offering an average turnaround time of an hour and costing one-fifth the price of an ER visit. The federal Department of Health and Human Services estimates that 13 to 27 percent of ER visits could be handled elsewhere.

Concerns about ER overcrowding are not unique to Steward hospitals, states Steward spokesperson, Deborah Chiaravalloti. With ER overcrowding leading to longer patient wait times, increasing violence, and overwhelmed healthcare workers, the situation is becoming increasingly critical.

The average ER visit length in Massachusetts has risen from just over four hours six years ago to nearly six hours in early 2023, according to CHIA. The shift of patients from Steward to other hospitals for specialized care is causing a trickle-down effect, exacerbating ER overcrowding. This causes longer transfer waits if former Steward patients are occupying hospital beds, warns Dr. Joseph Kopp of the Massachusetts College of Emergency Physicians.

Patients, often referred to as “boarders”, waiting for transfer in ERs are becoming increasingly common. These waits can lead to worse outcomes, more medical errors, and increased risk of avoidable complications.

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