NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Nathan Shekita

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NBER Working Papers and Publications

July 2017Surprise! Out-of-Network Billing for Emergency Care in the United States
with Zack Cooper, Fiona Scott Morton: w23623
Using insurance claims data, we show that in 22% of emergency episodes, patients attended in-network hospitals, but were treated by out-of-network physicians. Out-of-network billing allows physicians to significantly increase their payment rates relative to what they would be paid for treating in-network patients. Because patients cannot avoid out-of-network physicians during an emergency, physicians have an incentive to remain out-of-network and receive higher payment rates. Hospitals incur costs when out-of-network billing occurs within their facilities. We illustrate in a model and confirm empirically via analysis of two leading physician-outsourcing firms that physicians offer transfers to hospitals to offset the costs of out-of-network billing and allow the practice to continue. We fi...
 
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