What is the Prudent Layperson Standard and Why Should it Matter to You?

By Rhonda Sandel, Board President, Texas Association of Freestanding Emergency Centers (TAFEC)

Have you ever gotten the sense from your health insurance company that it’s trying to prevent you from fully utilizing the benefits of the coverage you’re paying for? If so, you’re not alone.

This past year, Anthem BlueCross BlueShield, the largest health insurer in the country, unilaterally decided to deny coverage to emergency room patients based on the final diagnosis they receive rather than evaluating the symptoms, which prompted the visit in the first place. This kind of “Monday Morning Quarterbacking” is not only dangerous, it is illegal. This policy has gone into effect in many states, including pro-consumer Texas—and there is nothing pro-consumer about this anti-patient policy.

Also disappointing is that the Texas Department of Insurance—which exists to protect the rights of insurance consumers—allowed this deplorable policy to go into effect.

Plainly put, if you think you are having a medical emergency and you go to the ER seeking care, your visit should always be covered by your health insurance plan.

Fortunately for Texas patients, your ER doctors and other medical personnel are standing up for you and defending your right to have your ER visit covered in the event of a medical emergency. In fact, with the 86th Legislative Session now underway, we as Texans now have a new online resource to turn to—it’s called My Emergency + My Choice. Here you can learn more about your rights as an ER patient.

The Prudent Layperson Standard—in Layman’s Terms

The Prudent Layperson Standard (PLS) grew out of the insurance environment of the early 1980s. In 1986, the U.S. Congress enacted the Emergency Medical Treatment and Labor Act (EMTALA), setting the standard that hospitals must provide care to anyone needing emergency treatment.

However, private insurers routinely would require prior authorization for emergency department visits or deny payments for visits that they deemed inappropriate for that care setting, often based on a retrospective review or discharge diagnosis. If an individual wanted insurance to cover an emergency treatment, the patient was expected to contact his or her insurer for approval prior to an ER visit.

This meant that anyone who visited the ER complaining of chest pains that were later determined to be something other than a heart attack, or other life-threatening condition, could be responsible for 100 percent of the cost of treatment.

This forced patients to contact their insurance company during a moment of crisis to essentially ask whether or not they should visit the ER—a policy which clearly placed the health and wellbeing of the individual in jeopardy.

In response to such potentially dangerous and unfair requirements, many states enacted Prudent Layperson Standard laws, with Congress enacting the Prudent Layperson Standard in 1997, which states:

“The term ‘emergency medical condition’ means a medical condition manifesting itself by acute symptoms of sufficient severity (including severe pain) such that a prudent layperson, who possesses an average knowledge of health and medicine, could reasonably expect the absence of immediate medical attention to result in”:

  • Placing the health of the individual (or, in the case of a pregnant woman, the health of the woman or her unborn child) in serious jeopardy,
  • Serious impairment to bodily functions, or
  • Severe dysfunction of any bodily organ or part, [or]
  • Serious disfigurement

The Great State of Texas adopted this Prudent Layperson definition in 1997 through Senate Bill 385, Section 1301.155.

The reality is this: certain insurance companies are now forcing reasonable people to make a decision—do I seek potentially life-saving care that I think I need (but might cause me financial ruin if I turn out to be wrong) or do I just wait it out and hope that whatever health emergency I think I’m facing soon passes?

Clearly, the answer should always be: if you or a loved one thinks they are experiencing a medical emergency, immediately go to the nearest ER for treatment. Your insurance company doesn’t get to decide whether or not you’re worth it.

And we’re going to make sure that your legislators know the truth, too. Again, that’s why we’ve established My Emergency + My Choice. Consumers deserve to have the right answers—and we want you to know that we’re looking out for you.

Sign this petition here (or text COVER to 52886) letting your legislators know that you won’t stand for having your ER insurance compromised. It’s imperative they hear from you today. The more patients’ voices are heard, the more likely our elected leaders will be to work towards patient-centered solutions that keep insurance companies from coming between us and life-saving ER care.

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