The California Medical Association (CMA) is urging Aetna to immediately rescind a recent update to its Claim and Code Review Program for emergency services that may violate state and federal laws, increase costs for physicians and cause delays for patients in need of life-saving emergency care.

Under the new policy – which took effect July 8, 2024, and applies to both fully insured and self-funded  plans – Aetna has indicated it will be reviewing physician and hospital emergency department claims that include Level 4 or 5 evaluation and management (E/M) codes and following that review "may adjust your payment if the claim details don't support the level of service billed."

“Aetna has failed to adequately disclose the details of this payment policy to physicians, to provide an accurate explanation of reasons for adjustment of services, or to consider CPT coding criteria in determination of level of service,” CMA stated in its letter to Aetna. “This change represents a significant policy shift that will negatively impact emergency room physicians and CMA requests that Aetna rescind the Claim and Code Review Program — Emergency Room Service edit immediately.”

New policy appears to violate state law

Despite multiple requests for more details, Aetna has refused to share the actual language of the policy change and has failed to adequately disclose the criteria it will use to adjudicate level 4 and 5 E&M claims. This lack of disclosure violates California law, which requires health plans to disclose “detailed payment policies and rules and non-standard coding methodologies used to adjudicate claims.”  

Additionally, Aetna has stated that, for claims identified as “over coded,” physicians would receive an Explanation of Benefits statement simply asserting Aetna’s conclusion that services billed failed to match services reported. Such a statement would not explain the specific reason for reaching that conclusion and thus would likely violate state law, which requires plans to provide an “accurate and clear written explanation of the specific reasons” for actions taken.

Finally, since it appears Aetna is performing level 4 and 5 E/M reviews at the outset of receiving a claim, CMA presumes that the assessment is primarily based on a patient’s diagnosis billed on the submitted claim.

“California law requires health plan/insurer payment policies and rules used to adjudicate claims to be consistent with ‘…standards accepted by nationally recognized medical societies and organizations’ and ‘federal regulatory bodies.’ CPT criteria for assigning emergency department service E/M codes is based on the complexity and medical decision making that is required to reach the final diagnosis for the patient,” CMA stated in its letter. “As such, the application of a policy significantly reducing payment based solely on the final diagnosis would wrongly penalize the treating physician and is inapt in the emergency care setting, where the final diagnosis code does not necessarily reflect the service intensity of the encounter and the services performed.”

Aetna’s policy would raise costs for physicians

CMA has expressed concern that Aetna may be intending to use this policy to delay all Level 4 and 5 E/M code payments by creating administrative barriers. “Emergency room physicians will be forced to pursue appeals to dispute the arbitrary and opaque downcoding of emergency service claims, increasing administrative costs and delaying payment for the physician,” CMA warned.

CMA also warned Congress Aetna’s new policy could delay emergency care

In addition to its letter to Aetna, CMA has co-signed a joint letter with the American College of Emergency Physicians (ACEP) and California ACEP asking that the California Congressional Delegation and the GOP Doctors Caucus urge Aetna to provide a clear and detailed description of the new policies, to ensure that it is not an attempt to delay payment or downcode services provided by emergency physicians, and is not in violation of federal law.

California law requires prompt payment of physician claims for emergency services and does not allow for delay based on a coding dispute. And federal laws, such as the prudent layperson standard, prohibit the use of final diagnosis codes to determine payment or coverage for emergency services. The prudent layperson standard requires insurance companies to provide coverage for emergency care based on symptoms, not the final diagnosis. 

Payment delays stemming from Aetna’s new policy could lead to a significant funding problem for the emergency care safety net as an aging population with complex chronic conditions has led, among other things, to a higher acuity patient mix in the emergency department.

“This policy will have significant impacts upon emergency physician groups that are already facing considerable financial hardships, potentially destabilizing the health care safety net and severely limiting access to the lifesaving emergency care that Californians need and deserve,” the joint letter to the California Congressional Delegation warned.

Practices that are having their claims for emergency services delayed or downcoded under this new policy are urged to contact the CMA Center for Economic services at (800) 786-4262 or economicservices@cmadocs.org.