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Congressional Efforts to “Fix” Surprise Medical Billing

Oct 10, 2019

AAPM&R members will likely be aware of the recent media and congressional focus on surprise billing of health care patients. This issue captured lawmakers’ attention this summer, but bipartisan agreement on legislative action has run into roadblocks with fierce industry opposition. It remains to be seen whether Capitol Hill will move forward with a solution, but congressional leaders continue to insist that they will act to protect patients from surprise medical bills.

While not a new phenomenon, “surprise” medical billing has been highlighted with significant media attention and congressional outrage. Specifically, surprise billing refers to large medical bills received by patients for unknowingly receiving out-of-network care at in-network facilities, or for emergency care provided out-of-network. With surprise bills, patients who may have thought they had sufficient health insurance can be held liable for significantly higher cost-sharing requirements than expected, or even be billed for the balance between the provider’s charges and their insurance plan’s coverage.

Several legislative packages in Congress would address surprise billing by protecting patients from being required to pay more than what their in-network rates cover in emergency situations and when they receive care at in-network facilities. However, the plans differ on a mechanism to resolve the costs when the patient is removed from the equation.

Sens. Lamar Alexander (R-TN) and Patty Murray (D-WA), leaders of the Senate Health, Education, Labor, and Pensions (HELP) Committee, have introduced the Lower Health Care Costs Act, S. 1895, which would apply a standard “benchmark” payment rate for all surprise bills. This would require health plans to pay providers the median negotiated commercial rate for services in a defined geographic area.

In the House, the Energy & Commerce Committee has approved the No Surprises Act, H.R. 3630, which would use a benchmark rate but allow providers to appeal to an outside arbiter for high-cost bills. A separate, bipartisan group of senators, led by Bill Cassidy (R-LA) and Maggie Hassan (D-NH), have proposed bipartisan legislation which would create an arbitration process for payers and providers to settle cost disputes.

While the Trump administration and both sides of the congressional aisle have all signaled their desire to act on surprise billing legislation, the health care industry has largely mobilized in opposition to some of the specific proposals. Almost all organizations have admitted a need to protect patients from surprise medical bills, but provider groups, including the American Hospital Association, the American Medical Association, and the Medical Group Management Association have supported arbitration and opposed benchmark payments, while many insurer groups, including America’s Health Insurance Plans, the Blue Cross Blue Shield Association, and the National Association of Health Underwriters have opposed arbitration and supported benchmark rates.

New coalitions have arisen on both sides of the debate, including Doctor Patient Unity (anti-benchmark rates) and the Coalition Against Surprise Medical Billing (pro-benchmark rates).  These coalitions have poured millions of dollars into advertising campaigns that have ground the congressional work on surprise billing to a halt.

With much of Congress’ focus directed towards impeachment proceedings and the larger drug pricing debate,  surprise billing legislation may no longer be the “low-hanging fruit” that lawmakers foresaw this summer. However, staff and legislators are still holding out hope to address the issue this year.  In fact, House Ways & Means Committee Chairman, Richard Neal, recently proposed a new plan with a federal regulatory process to determine both payment rate standards and an arbitration process, but this compromise does not seem to have broken the congressional log jam. 

The Academy will continue to monitor new developments in surprise billing legislation and keep our members informed of any congressional action.