Blue Cross draws billing boundaries

A policy change by one of the nation's largest insurers has some HME providers feeling the blues, say industry stakeholders.

In October, Blue Cross Blue Shield (BCBS) began requiring providers to bill the insurance plan for the state in which the subscriber—the patient—is located.

“Historically, providers have always billed their home state for every patient they service, but now they are not allowed to do that,” said Sylvia Toscano, owner of Professional Medical Administrators. “We are already seeing rejections for electronic claims.”

The biggest impact is to small and mid-sized providers located near a state line that serve patients in neighboring states but are only enrolled in one BCBS network, say stakeholders. And it's difficult if not impossible to enroll in some of the networks.

Michael Hamilton, executive director of the Alabama Durable Medical Equipment Association (ADMEA) said his members haven't been able to enroll in BCBS networks in Tennessee, Georgia, Florida and Mississippi.

“Blue Cross has always been very proprietary,” he said. “They will not typically admit anyone to their preferred provider network who doesn't have a physical location in the state.”

Providers can bill out-of-network for patients in other states, but that means the patient is stuck with a higher out-of-pocket cost—a tough sell, he said.

For DME that is shipped to patients who are traveling outside of their home state, BCBS says the provider must bill the plan in that state.

How, asks Rose Schafhauser, is that supposed to work?

“You cannot anticipate where your patients are going to be traveling so for them to say you have to have a contract with these other states—it's not going to happen,” said Schafhauser, executive director of the Midwest Association for Medical Equipment Services.

One upside to the policy change: It prevents “cherry-picking.”

“National providers were shopping around and going after patients that had the best reimbursement in their respective states,” said Schafhauser.

With no success fighting the change at the state level, several state association leaders planned to draft a letter on behalf of all providers asking BCBS to reconsider the policy change.