WASHINGTON (AP) – People with private health insurance plans will see the nasty shock of “surprising” medical bills all but gone, thanks to the coronavirus compromise passed by Congress.
Costs, which can range from hundreds to tens of thousands of dollars, come from doctors and hospitals who are outside a patient’s health insurance network. It is estimated that about 1 in 5 emergency visits and 1 in 6 inpatient admissions will yield a surprise bill.
While lawmakers on both sides had long agreed that the practice amounted to billing abuse, a lobbying war between doctors and insurers had thwarted compromise, allowing the standoff to become a symbol of dysfunction in Washington.
“This has been a very troubling pocketbook for families for years,” said Karen Pollitz, a health insurance expert at the nonpartisan Kaiser Family Foundation. “Some of these bills are tough, and they all find people completely unfair.”
The compromise would put patients and their families out of financial sight by limiting the amount they could be charged for out-of-network services to a fee based on costs in the network. The amount that consumers pay is counted towards their annual deductible in the network.
Insurers and service providers will submit their billing disputes to an independent dispute resolution process, which will follow certain guidelines. The main provisions of the legislation will enter into force on January 1, 2022.
“It’s generally positive to keep consumers out and force providers to settle in,” said Eagan Kemp, a policy expert at Public Citizen, a liberal advocacy group. While states have begun to curb surprise bills, federal action was needed because states have no jurisdiction over major employer plans that cover tens of millions of workers and their families.
The main elements of the legislation are:
– Keeping patients harmless from surprise bills resulting from emergency medical care. That would apply if the patient is seen in an off-network facility, or if they are being treated by an off-network clinician at a network hospital. In both cases, the patient could only be billed based on his plan’s in-network rate.
– Protect patients admitted to a hospital within the network for a planned procedure when an out-of-network physician becomes involved. This can happen if a surgeon is called in to assist in the operating room, or if the anesthetist on duty is not part of the patient’s plan.
– Generally, service providers outside the network require 72 hours to notify their patients of their estimated costs. Patients would have to agree to receive out-of-network care for the hospital or physician and then bill them.
– Prevent air ambulance services from sending surprise bills to patients for more than the amount shared in-network. Airplane ambulance costs have become a bigger problem in states where patients have to travel long distances to get to the best hospitals. However, ground ambulance services will not face the same restrictions, and the legislation just requires more research into their billing practices.
The compromise legislation included two years of work by dozens of lawmakers from both parties and key committees, including Energy and Commerce and Ways and Resources in the Home, and Health, Education, Labor and Pensions in the Senate.
Surprise bills hit patients and their families when they are most vulnerable – after a medical emergency or after a complex surgical procedure. Often patients can negotiate lower costs by partnering with their insurers and the medical provider. But the process usually takes months, adding stress and anxiety. Sometimes it doesn’t work and the bills go to collection agencies.
“Our constituents have done everything right in the doctor’s office or hospital, but were still stuck with surprising medical bills, sometimes for tens of thousands of dollars,” said Sens. Maggie Hassan, DN.H., and Bill Cassidy, R-La. And often they have to fight these bills while facing a medical crisis.
According to the Kaiser Foundation, 18% of emergency visits result in at least one out-of-network fee for people paid by major employers, as well as 16% of hospital admissions. New York and Texas are among the highest rates.
The problem is a direct result of high healthcare costs. To keep premiums under control, insurers set up networks of hospitals and doctors who make agreements in advance about the amount of the payment. But some in-demand clinicians, such as emergency room physicians and anesthesiologists, have an incentive to at least stay out of some networks and try to maximize their earning potential. That dynamic has gotten more complicated as profit-seeking investors buy up medical practices that have greater leverage on billing.
Insurers were cool with the compromise, saying that the structure of the dispute resolution process could lead to higher payouts leading to premium increases. Some Democrats had advocated using a predetermined price list to resolve billing disputes, but Republicans and other Democrats felt that was too close to government-set rates.
“Our profitable health care system really allows companies to make money in the various gaps of the system,” said Kemp, Public Citizen’s health care advocate. “This is a hopeful day. I thought between the insurers and the providers, there would be no legislation for surprise billing. “
Public programs such as Medicare and Medicaid prohibit or restrict such billing practices.