Reponse from Carolinas HealthCare System

12/15/2012 6:15 PM

12/15/2012 6:36 PM

Questions from The Charlotte Observer

On Nov. 2, the Observer sent Carolinas HealthCare System the following questions:

• After CHS buys a physicians’ practice, how does the billing for routine office visits and echocardiograms at those offices typically work? Does the billing automatically switch to the hospital system’s higher outpatient rate? Do some of the doctors continue to bill at the existing physicians’ office rate? Is there a policy about how this is routinely handled?

• Why do hospitals sometimes charge significantly higher amounts than physicians’ offices for routine tests and services, such as echocardiograms, office visits, physical therapy and sleep studies?

• We understand that after the Sanger Clinic joined CHS, some patients have been sent to hospitals for echocardiograms and other cardiac tests that used to be done in the doctors' offices. Were doctors instructed not to do those tests in the office anymore? If so, why was that change made and when was it made?

• Related to that, we have spoken to the husband of a patient who had been getting echocardiograms at the Sanger office in Shelby and is now being directed to get her echocardiograms at Cleveland Regional Medical Center. As a result, the patient's out-of-pocket expenses increased substantially. She used to pay a $35 co-pay each time she had her annual echocardiogram. But this year, Sanger told her to get her echo test at Cleveland Regional Medical Center. It was the same test she’d received in previous years, but this time it was billed as an outpatient procedure, and her out-of-pocket expense was nearly $1,000.

What are your thoughts about that? Could the hospital system keep such tests at the lower price point? Is it fair to patients to pay so much more money for the same test?

We also asked Presbyterian about this and learned that, even after Mid Carolina Cardiology doctors became employees of the hospital system, they continued charging the same office rate for echocardiograms.

• Another example is physical therapy.

A patient who has been getting physical therapy at Carolinas Rehabilitation Pineville was told that his charge would increase last spring. The amount of his bill doubled for the same therapy, with the same therapist, in the same office on the CMC-Pineville campus. The patient was told the change came about because the office began billing for its services as a hospital-based setting instead of an outpatient setting. Can you explain why that change made?

• We notice from Medicare data on claims for echocardiograms and routine office visits that N.C. hospitals are submitting significantly more bills for those services than they have in the recent past.

The number of echocardiography claims that CHS hospitals billed for increased by nearly 50 percent from 2007 to 2010. At CMC alone, the number more than quadrupled over that time period.

And the number of office visits that CHS hospitals billed to Medicare climbed by more than 40 percent from 2007 to 2010. Can you explain what accounts for these increases?

• A former member of the MedPAC board and other health care experts suggest that, in general, this is a national problem and that these increases in prices -- after hospitals absorb doctors offices -- are not accompanied by an improvement in quality. Would you disagree with that?

• How many doctors does CHS now employ?

We read in one CHS bond disclosure document that the system employed 1,228 primary and specialty physicians in 2011. Is that the best measure? If not, please tell us what figure you think is most accurate? And can you tell us what the figure was 10 years ago?

We also read a separate figure showing 2,765 physicians for the CHS combined group staff. What’s the difference between these two figures?

• Can you tell us what percentage of doctors employed by CHS now work in offices that are considered outpatient facilities or departments of CHS?

Carolinas HealthCare System statement

On Dec. 6, CHS sent this response:

"As the region’s largest safety net provider, Carolinas HealthCare System is committed to providing the highest quality healthcare to everyone who needs it, regardless of ability to pay. CHS’s Sanger Heart & Vascular Institute is one example of how we are building on that commitment, being nationally recognized by the American College of Cardiology for cost effectiveness and delivering the most appropriate care to each patient.

"Throughout the entire network of hundreds of CHS physician practices, only about 20 percent are hospital-based. Those that are hospital-based are clinically integrated with a CHS hospital which allows for improved access, quality and coordination of care for our patients. Furthermore, hospital-based practices are held to higher regulatory and quality standards than private practices which therefore may result in higher costs.

CHS does not take a one size fits all approach to providing care or to the charges applied to services, and we work hard to achieve greater value and better care for our patients if these higher charges do occur. Our mission at Carolinas HealthCare System is to provide every patient in every community we serve with the healthcare they need. We know our patients have a choice in where they receive care, and we remain vigilant in innovating to create higher quality, better outcomes and an improved experience; ultimately creating true value for all patients."

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