Prudent Layperson, Meet Imprudent Payer


Anthem has announced that it will not cover “inappropriate” emergency department visits, as judged after the fact.  This flouting of the law is bad policy, and patients are going to get hurt.

In the past year, insurance giant Anthem has announced that in six states, they would not cover “inappropriate” ED use. While I’m not foolish enough to think that insurers will ever completely stop their shenanigans, I thought they’d at least stop saying the quiet part loud while brazenly flouting the law. The ACA made the prudent layperson standard federal law.[1] The prudent layperson standard is exactly what it sounds like: the definition of a medical emergency is what a normal person with an average knowledge of medicine thinks is an emergency – the patient’s symptoms make it an emergency, not the final diagnosis. The classic example is that insurers need to cover ED visits for chest pain that turns out to be heartburn. Similarly, as in a recent Vox article by Sarah Kliff, severe abdominal pain that turned out to be “just” an ovarian cyst is, by definition, an emergency.[2]

This is both obvious and good: the patient can’t tell if their severe abdominal pain is something terrible and dangerous like appendicitis or something that’s painful but not dangerous. In fact, as any emergency physician can tell you, we usually can’t tell if something is a “true” emergency without seeing and evaluating the patient, often with a host of laboratory and imaging tests.


Additionally, it’s important to point out that severe pain alone is, by law, a medical emergency. We don’t want people writhing around in pain wondering if their insurer will cover their ED visit.


As with many health policy stories, the history of the prudent layperson standard started with the rise of managed care in the 1990s. I’ve heard the stories of patients calling their HMOs from waiting rooms trying to get prior approval for their ER visits. States began enacting prudent layperson statutes in 1995, with 32 states plus DC implementing prudent layperson laws before it became federal law as part of the ACA in 2010.[3] Now, all but three states have prudent layperson statutes.[4]


Congress had previously extended prudent layperson protections to Medicare and managed Medicaid as part of the Balanced Budget Act of 1997 (which also brought us the SGR, RIP). In fact, to protect people from future administrations more hostile to executive regulation, Congress wrote the prudent layperson standard right into the ACA statute: “EMERGENCY MEDICAL CONDITION.—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, with respect to a pregnant woman, the health of the woman or her unborn child) in serious jeopardy… serious impairment to bodily functions… [or]serious dysfunction of any bodily organ or part.] [5,6]

And once again, this is very important because we shouldn’t expect people to sit at home and worry about whether their severe pain is “just a cyst” or a ruptured appendix or an ovarian cyst causing a ovarian torsion or rupture with massive internal bleeding. If the patient is acting like a “prudent layperson” and thinks they are having an emergency, then it is an emergency and the insurer must cover the ED visit.

As any emergency physician can tell you, this is important because there is a huge overlap in symptoms between simple benign problems (ovarian cyst) and serious life-threatening problems (appendicitis). This is part of the reason why we haven’t been replaced by robots yet. A fantastic study by Maria Raven and colleagues looked at the overlap in chief complaints for low and high acuity diagnoses and the answer is “pretty much all of them.”[7]



For the past year Anthem has publicly announced that in Missouri, Georgia, Indiana, Kentucky, Ohio, and New Hampshire they will start denying claims for low acuity “inappropriate” visits. This is in flagrant violation of federal law and state law (except for New Hampshire). This is terrible and patients are going to get hurt.

Are there patients who abuse the emergency care system?  Sure. Are there patients who might be able to be seen in less expensive outpatient settings? Sure. But tons of patients end up with final diagnoses like “acute viral bronchitis” that sound simple until you realize the patient is 80 and has CHF and COPD – and it could easily be flu or pneumonia or a serious COPD or CHF exacerbation – any or all of which could kill them.

There are lots of reasons why patients end up seeing me instead of seeing their primary care physician or going to an urgent care center. For starters, one in four ED patients are sent to us from another provider.[8] This happens for a number of reasons – little capacity for acute unscheduled care in primary care practices that have thin margins and need to fill their slots; office hours typically during regular business hours; risk tolerance of outpatient providers; our same-day access to labs, imaging, specialists – just to name a few. And while there are some patients who might be in the ED “inappropriately,” they don’t cost very much,[9] efforts to try to redirect them away from the ED don’t save money,[10] and of course, they are not the cause of ED crowding.[11]

Why go after these patients – who usually came to us because they have nowhere else to go – when that’s not where the money is?  What concerns me most is not the lost revenue from uncovered low acuity visits but rather the patients who have concerning symptoms and sit at home worried about going to the ED because they are worried about getting a big bill.

Many of these bills are big enough to make headlines of their own. In the Vox feature, the patient was charged a whopping $12,600, which most of us agree is absurd. But that’s how our system works – she was charged the full “chargemaster” rate, not the negotiated rate that insurers pay.

Charges are inflated like this for a number of reasons; they are mostly an artifact of negotiations between providers and insurers, as well as a way to more generously describe charity care. These sky-high charges are traditionally discounted for patients who foot their own bill, and until recently, most emergency departments and physicians didn’t chase patients for the full freight charge. Most self-pay emergency care was almost immediately written off as bad debt.

Part of the issue is that the system is complex and opaque to patients, and while hospitals may be in network, the physicians who staff the ED may not be. When negotiating with ED groups, insurers know that EMTALA (appropriately) requires us to see ED patients regardless of their ability to pay, and so they don’t have to negotiate in good faith to ensure we’re in network. It’s only in recent years that some hospitals and some for-profit corporate physician staffing groups have started really trying to collect charges from self-pay patients. As a specialty, we need to do a better job of reining in the bad actors.

Unfortunately, there are patients who do get hit with bad bills, and they’re often framed as “surprise bills” instead of “surprise lack of coverage.” This is not a good look for us, especially when it’s easy to describe an ED visit bill as a $600 band-aid rather than an evaluation by nurses and physicians for a continuously bleeding wound. A big part of what we as emergency physicians do is implicit – laying eyes on the patient from across the room, deciding whether their symptoms warrant expensive testing or invasive treatments based on our years of training and experience.

Anthem says they are doing medical review of cases before they deny coverage, [12] but this is hard to believe. For starters, they have the advantage of hindsight bias, and they know what the patient’s workup did or did not reveal. Further, if they are reviewing medical records, then they are intentionally violating the law when they deny care for severe abdominal pain, as in the Vox article.

Recently, a former Aetna medical director admitted under oath that physicians are not routinely reviewing records.[13] This is a different company, but I would still be shocked if there was a single physician who was surprised by this admission. Unfortunately, as with violations of the prudent layperson standard and other insurer shenanigans, a lot of patients are left in the lurch. Many people don’t have the knowledge, time, or funds to fight big bills or inappropriate insurance denials. A big part of the reason that Anthem and Aetna can get away with bad behavior is that there are not a lot of fixes.

ERISA, the federal law enacted in the 1970s to protect workers’ pensions from corporate plunderers, gov erns most employee sponsored insurance plan and severely limits civil damages.[14] Unfortunately, decades of Congressional dysfunction have left this unintended consequence unfixed. State regulators, when not neutered by ERISA, are often resource limited or in the pocket of insurers, and as with much of the enforcement of ACA regulations (such as network adequacy and essential health benefits), federal regulators have ducked a lot of their responsibilities as well.  Public pressure has pushed Anthem to budge; they say they won’t deny coverage for visits that include IV fluids, advanced imaging like CT and MRI, surgery, and observation or admission.[15]

But this is little more than a fig leaf. If they were doing any sort of legitimate medical record review in the first place, treatments and dispositions like these would have shown the obvious appropriateness of the ED visits in question. Even more importantly, the layperson at home with severe abdominal pain has no idea whether they will get IV fluids or less-than-2-midnight observation when they are trying to decide whether to seek treatment. Hindsight bias isn’t helpful.

Meanwhile, Anthem has also told providers that they will be doing retroactive reviews of imaging utilization, withholding payments until records show that “appropriateness criteria” are met.[16]
The more for-profit insurers continue to act in bad faith – even directly violating the law – the more the public will be pushed into supporting a massive systemic change like single payer.


[1] — Practice-Management/ACEP-Initiative-Supporting — Prudent-Layperson — Standard-Becomes-Law-in-Health-Care-Reform-Act/#sm.00000dkj9tbqbrdpdqyhublmubvzy
















Dr. Trueger is an emergency physician at Northwestern University and Assistant Social Media Editor at Annals of Emergency Medicine. He tweets as @MDaware and blogs at


  1. Time for ACEP to initiate a class-action lawsuit against Anthem, as well as asking AG Jeff Sessions to begin an anti-trust investigation into a large insurance company that sets a bad, broad public policy covering several states. Let’s see some action, for once.

  2. Tom Sugarman on

    Great piece Dr. Trueger.

    I think the massive changed needed is to get rid of for-profit insurance companies rather than going to single payer. Repeatedly, we see for-profit insurers abusing their customers/members and cheating providers all in the drive for profits.

    People want quality health care. Not insurance and especially not insurance with surprise coverage gaps.

  3. Thomas Benzoni on

    I would submit we EPs have it precisely backwards.
    I think Anthem here is the rational actor, not us.
    A commercial entity (Anthem) gives a contract to a person to provide a service.
    An entity (ER/EP) provides that service; said service cannot be revoked or repossessed.
    The person (patient) to whom the service is provided is not obligated to pay for the service, the contractor is.
    The contractor has unilateral say on whether or not they pay for the service; their contract is with the person, not the entity.
    I think Anthem is the rational player here.
    And until we can see Anthem’s point of view, we will continue to tilt windmills.

    • Except we aren’t contracting for a new roof. And roofers don’t have to worry about EMTALA. Your perspective is fairly skewed, unless you really think the ED is a business. If you do, God help your patients. Because CEO’s won’t.

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