In recent years, lawmakers and healthcare providers have worked towards ending surprise billing, which affects approximately one in five insured individuals throughout their lifetimes. Policymakers have spent the last few years proposing potential solutions to end surprise billing, but with coronavirus concerns still rising, hospitals have asked Congress to refrain from passing any new legislation on the topic until after the pandemic slows down.
What is surprise billing?
Surprise billing occurs when a patient inadvertently receives medical care from a physician outside their insurance network. This typically happens in one of three ways: a patient seeks out emergency care outside of their insurance network due to travel or limited option, a patient receives care from an out-of-network provider while visiting an in-network healthcare facility, or a health plan deems a patient’s emergency care as unnecessary.
These bills are a combination of insurance company charges for using out-of-network physicians and “balance billing,” which covers the difference between the provider’s full rate and what the insurance company is willing to pay. They often amount to thousands of dollars in medical expenses that may upset a family’s entire livelihood.
A Team Effort
Several congressional efforts to address surprise medical billing were derailed by the appearance of the novel coronavirus in the U.S. back in March of this year. Among them were the Scott-Foxx Ban Surprise Billing Act (H.R. 5800) and the Neal-Brady Consumer Protections against Surprise Bills Act of 2020 (H.R. 5826) that both propose the implementation of a benchmark payment rate. A benchmark rate would ensure that providers were paid a set rate based on the median cost of in-network health services in their geographical location.
Hospitals have banded together to request that policymakers instead opt for an arbitration process, in which the insurance company and healthcare provider would propose a fair cost for services received that would assist a third-party arbitrator to decide on a fair price. Some congress members have voiced concern over arbitration delaying the claims process and increasing overall costs; however, some states have already adopted arbitration on a small-scale, like New York, due to the equality and impartiality the system provides.
In a letter to congressional leaders, a group of hospital executives wrote, “We urge Congress instead – if it chooses to move forward with legislation to address surprise medical bills – to enact a proposal that would completely remove the patient from the middle of payment disputes between insurers and providers, while also preventing the federal rate-setting approach that tilts the scales in favor of insurers.”
The American Hospital Association predicts that hospitals will lose over $323 billion in 2020 directly due to the outbreak of COVID-19. The association advised Congress to focus on educating patients about their health plan coverage and ensure that all patients are provided a comprehensive and up-to-date list of in-network providers and related information.
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