ACP Pushes for Surprise Medical Bill Legislation in House

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ACP supports legislation proposed by House Ways and Means Committee that mandates mediation for out-of-network bills

March 6, 2020 (ACP) – The American College of Physicians continues its work to influence the debate over legislation to deal with so-called “surprise billing,” unexpected medical costs incurred by patients above and beyond insurance coverage.

“Surprise billing” creates a tremendous burden for patients who are suddenly and unexpectedly saddled with huge medical expenses even when they believe they have reliable and comprehensive insurance. As Congress takes action, the American College of Physicians wants to ensure the nation's leaders make a decision that protects patients while treating physicians and other stakeholders fairly.

“As an organization that has continually championed access to care for patients, ACP recognizes the hardship that surprise medical bills can pose to patients' efforts to access critical health care services,” said Richard Trachtman, ACP director of legislative affairs. “Surprise bills represent an unfortunate gap in our system of payment for health care, one which should be remedied legislatively as soon as possible.”

According to a 2019 report by the Kaiser Family Foundation, surprise medical bills hit an extraordinary number of patients under the age of 65 in 2017. An estimated one in every six hospital visits by patients insured through large employers resulted in a surprise medical bill.

These bills “can amount to tens of thousands of dollars and hit patients and their families when they are most vulnerable,” the Associated Press reported. “Often patients are able to negotiate lower charges by working with their insurers and the medical provider. But the process usually takes months, adding stress and anxiety. When it doesn't work out, bills can get sent to collection agencies.”

Last summer, the president issued an executive order that mandates transparency of health care costs and calls for regulatory steps to address surprise billing. Congressional committees are now exploring options to protect patients.

This year, a divide has developed in the U.S. House of Representatives between competing bipartisan plans. The House Energy and Commerce Committee and House Education and Labor Committee have pushed their own bills forward with the support of the Senate HELP Committee. But ACP and its allies – including medical societies and hospitals – prefer a separate bill which has been favorably reported by the House Ways and Means Committee.

At issue: How will payment rates be determined? The bills from the House Energy and Commerce Committee and the House Education and Labor Committee would set the payment rate based on the median amount paid for that service in the geographic area, with the option of going to mediation for some higher-cost bills, reports The Hill. The House Ways and Means Committee would instead give the payment decisions to an independent, outside mediator.

“A key element of the Ways and Means Committee bill is the lack of benchmarking,” Trachtman said. “In other words, mediators may not consider insurers' in-network rates in making a determination based on information submitted by the parties. ACP has strongly recommended against benchmarking mediation to insurers' in-network rates since this would allow insurers to essentially impose rates for both in-network and out-of-network services.”

The ACP favors the Ways and Means bill. As it noted in a letter to committee leaders, ACP strongly supports:

  • Holding patients harmless: “In emergency situations, there simply is not enough time for the patient to know which clinicians are in-or out-of-network,” ACP writes. “In non-emergency situations at in-network facilities, absent any prior notice, patients appropriately would assume that all of their care would be considered in-network.”
  • Increasing transparency: “It is critical that a patient be informed in advance of receiving services, whenever possible, if a clinician is out-of-network so that the patient can make an informed choice before the care is rendered,” ACP writes.
  • Mandating mediation for out-of-network bills: The Ways and Means legislation “establishes a fair mediation process to be utilized when the parties cannot agree on a payment amount after . . . an out-of-network service is provided to the patient,” ACP writes. “The parties may enter a 30-day open negotiation process with the goal of reducing the information asymmetry to encourage resolution of disagreements.”
  • Establishing standards for network adequacy: “Legislation to hold patients harmless should include provisions requiring network adequacy, similar to requirements specified in the Affordable Care Act,” ACP writes. “Narrow networks contribute to surprise out-of-network costs.”
  • Examining the relationship between payment levels and network availability: “Appropriate and fair payment of services by physicians will increase their in-network participation rates and reduce those concerning situations where patients are billed for out-of-network care,” ACP writes.

The Hill recently interviewed Bob Doherty, ACP senior vice president of governmental affairs and public policy, and noted that “he does not approve of the tactics of some doctor-staffing companies that are owned by private equity firms and have run millions of dollars in ads against rival legislation.”

“I think physicians' credibility is hurt by being too linked to them,” said Doherty, noting that patients are not facing a heavy burden of surprise bills from internists.

In terms of advocacy, ACP “has sent letters to Congress on this important subject,” Trachtman said. “ACP has periodically consulted with the American Medical Association on the subject of surprise medical billing and has participated in federation conference calls on the subject. And in February, I attended a meeting with Ways and Means Committee staff together with representatives of a number of physician organizations.”

ACP is also working on surprise billing with the American Academy of Family Physicians, the American Academy of Pediatrics, the American College of Obstetricians and Gynecologists, the American Osteopathic Association and the American Psychiatric Association.

“The College has and will continue to collaborate with these frontline physician organizations on surprise medical billing as well as on a variety of other issues with the intent of ensuring access to high-quality primary care services,” Trachtman said.

“I'm guardedly optimistic that Congress could clear a bill by the end of this calendar year. The Ways and Means bill provides that, beginning in 2022, consumers receiving emergency medical services at a nonparticipating facility will be limited to in-network cost sharing and protected against surprise medical bills,” he added. “The Ways and Means bill also provides that, beginning in 2022, providers will be prohibited from sending a balance bill to consumers who received emergency medical services at a nonparticipating facility or medical services by nonparticipating providers at a participating facility. In addition, if patients receive incorrect information from their insurer about the network status of the provider, the patient will be protected from any balance bill.”

More Information

The issue brief “Congress Works to Address Surprise Medical Billing” is available on the ACP website.

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