AMA: Congress begins consideration of surprise billing legislation

The American Medical Association’s ‘Advocacy Update’ included the following article on June 27…

On June 24, the Senate Committee on Health, Education, Labor and Pensions (HELP) released an updated version of S. 1895, the “Lower Health Care Costs Act,” which was considered by the Committee on June 26. Though the bill contains numerous commonsense proposals for lowering the cost of health care, there are significant negative consequences for physicians contained in Title I of the bill, “Ending Surprise Medical Bills.” Earlier versions of the bill had contained several options for addressing the impact on patients of medical bills from out-of-network providers, including an untested concept referred to as an “in-network guarantee” as well as allowing disputes between insurers and providers to be settled in through “baseball-style” arbitration. The final committee bill, however, included a mandate that insurers pay out-of-network physicians at the median in-network rate, with no additional patient cost-sharing allowed. This restriction would apply to all out-of-network physician services at in-network facilities, including freestanding emergency departments, ambulatory surgical centers, critical access hospitals, laboratories, radiology clinics and others when the care was provided in an emergency (or for active labor), or where non-emergency services were provided by physicians not generally selected by patient such as anesthesiologists, pathologists, radiologists, on-call specialists and consultants. It would also apply to out-of-network services furnished after an enrollee has been stabilized but declines to consent to pay out-of-network amounts.

HELP Committee Chairman Lamar Alexander (R-TN) hopes to take the legislation up on the Senate floor before the August congressional recess and use the savings generated by the bill to pay for other federal spending priorities.

While virtually all physician organizations support limiting patient costs to their in-network amount in cases where patients did not have the opportunity to select their physician, there are serious potential implications from a government mandate to pay in-network median rates. Plans will have little incentive to offer fair contacts to physicians when they are guaranteed not to have to pay those physicians more than in-network rates for out-of-network care. Physicians with contracts above a plan’s in-network rates will likely see those contracts canceled or face demands for significant rate concessions to remain in-network. Those actions would have the secondary effect of further depressing median in-network amounts and threatening access to care.

Physician organizations, including the AMA, have been calling on Congress to pass legislation based on the successful model in New York that has significantly curtailed surprise billing complaints by instituting a “baseball-style” independent dispute resolution system whereby a neutral arbiter chooses between the amount offered by the plan and the amount billed by the physician. Not only is this proven system efficient, it has encouraged more reasonable plan offers and curtailed outlier billing. Such a proposal was introduced on June 26 as H.R. 3502, the “Protecting People from Surprise Medical Bills Act,” by Rep. Raul Ruiz, MD (D-CA), Rep. Phil Roe, MD (R-TN) and over 30 other cosponsors including Rep. Larry Bucshon, MD (R-IN), Rep. Brad Wenstrup, DPM (R-OH), Rep. Ami Bera, MD (D-CA), former U.S. Department of Health and Human Services (HHS) Secretary Rep. Donna Shalala (D-FL), Rep. Joe Morelle (D-NY) who authored the NY law, and Rep. Van Taylor (R-TX).