Disputes over coverage of emergency department services: a study of two health maintenance organizations

We describe the characteristics and outcomes of enrollee-health plan disputes over insurance coverage for emergency department (ED) services at 2 large health maintenance organizations (HMOs) that apply the prudent layperson standard.

We abstracted information from a stratified random sample of approximately 3,500 appeals of coverage denials lodged by privately insured enrollees between 1998 and 2000 at 2 of the nation's largest HMOs (hereafter referred to as Plan 1 and Plan 2). We describe appeals involving ED services in terms of the timing of visits, patient age, costs of services, primary reason the patient sought care, and appeal outcome.

Disputes over ED services accounted for approximately one half (52%) of postservice appeals at Plan 1 and one third (34%) at Plan 2. Nearly one half (46%) of ED appeals involved weekend, nighttime, or holiday visits to the ED; 22% were children's visits. The average cost of services in dispute was US$1,107. The most common general reasons for the ED visits in dispute were symptoms of illness (64%), injuries (22%), and services related to disease (8%). The most common presenting symptoms were abdominal pain, cramps, or spasms (7.6%); earaches or ear infections (3.4%); and lacerations/cuts (2.9%). Enrollees won more than 90% of appeals.

The prevalence of ED cases among all appeals reflects disagreement between lay and expert judgments about what constitutes emergency care under the prudent layperson standard. The high rate at which enrollees win these appeals highlights significant disagreement in interpretation of the standard among different adjudicators within managed care organizations (medical groups and health plans). When enrollees fail to challenge denials that would be reversed on appeal, they bear the financial brunt of ambiguities in interpretation of the prudent layperson standard.