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Clare
Fitzgerald
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Phone:
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847-553-3714
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clare.fitzgerald@pciaa.net
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N.J. Ambulatory Surgical Center Bill Rewards Unethical
Doctor Practices, Drives Up Insurance Costs
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TRENTON, N.J.— The Property Casualty Insurers
Association of America (PCI) strongly opposes Senate Bill 787 passed in the New
Jersey Senate this week that allows physicians to make self-referrals to their
ambulatory surgical centers. This legislation threatens the fight against
insurance fraud and will drive up auto insurance costs and jeopardize patients’
best interests.
“While on the surface, S787 appears to be an attempt to
reform the practice of self referral by medical practitioners, the fact is it
would allow doctors to pocket millions of dollars from improperly filed
insurance claims,” said Richard Stokes, PCI regional manager.
Senate Bill 787 would change language related to
ambulatory surgical centers to allow medical providers to refer patients to facilities
in which they have a financial interest. Lifting the restrictions on
self-referral will invite more insurance fraud into the New Jersey marketplace,
thereby driving up insurance costs. The bill will be considered in the Assembly
in January.
In addition, the proposed legislation includes a clause
that provides a retroactive “carve out” exempting current violators, meaning
that doctors and medical practitioners who engaged in deceptive billing
practices would still be able to collect on illegally submitted insurance
claims.
“Doctors who knowingly engaged in deceptive billing
practices and blatant conflicts of interest should not be rewarded for their
indiscretions,” said Stokes. “If these illegally submitted claims were paid, it
would be financially devastating to New Jersey motorists who pay for auto
insurance and to those companies that insure them. Referral of patients for
specific healthcare services should be based purely on medical considerations
and should not be influenced by potential financial gain for the providers
involved. Similar to the abuses we have seen on Wall Street, some New Jersey
doctors have abused a loophole in the law that advances their own financial
interests to the detriment of the healthcare delivery system as a whole.”
New Jersey has the largest number of ambulatory surgery
centers per capita than surrounding states. While ambulatory surgical centers
were originally created as low-cost providers of certain treatments outside of
hospitals, in some cases treatment cost in these facilities can be 300 to 500
percent higher than in nearby hospitals.
“The original legislation on this issue was passed and
signed into law in 1988 to address the possible over-utilization of services,”
said Stokes. “Senate Bill 787 will undo efforts to control over-utilization of
medical services and insurance fraud, which have been key to many of the
positive changes we have seen in New Jersey auto insurance reform,” said
Stokes.
PCI is composed of
more than 1,000 member companies, representing the broadest cross-section of
insurers of any national trade association. PCI members write over $198
billion in annual premium, 40.5 percent of the nation’s property casualty
insurance. Member companies write 51.6 percent of the U.S. automobile
insurance market, 39.7 percent of the homeowners market, 33.2 percent of the
commercial property and liability market, and 38.7 percent of the private
workers compensation market.
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