Negotiations continue on surprise billing

| December 16, 2019

Negotiations continue on surprise billing

The Health, Education, Labor and Pensions (HELP) and Energy and Commerce Committees invited a representative of the College to an exclusive stakeholder briefing last week to review their agreement on surprise billing legislation.

In a Congress unable to agree on many issues, ending unexpected out-of-network “surprise” medical bills has consistently been the one issue where everyone has found common ground. Unfortunately, underneath a broad consensus on the need to end surprise medical bills, there has been far less agreement on just how to accomplish this goal. 

On Dec. 8, we saw the first signs of an emerging consensus on a bi-partisan, bi-cameral solution to end surprise medical bills. Leaders for two of the key congressional committees with jurisdiction over this issue announced they had reached an agreement on legislation to protect patients from unexpected charges.

While many initially interpreted this as an indication that a bill restricting this practice could be on the President’s desk before the end of the year, those pronouncements appear premature. Although the Senate Health Education, Labor and Pensions (HELP) Committee and House Energy and Commerce Committee announced their agreement, this would not be the last word. Within days, others in the House and Senate indicated they had bi-partisan proposals they were not prepared to abandon in favor of the new agreement.   

"We still have many unanswered questions, and the College continues to advocate for a solution that is fair to both patients and physicians."

It now seems negotiations will be ongoing, and, while a consensus appears within reach, it is unlikely there will be an agreement before the end of 2019, with negotiations extending into 2020. 

Key negotiators appear to agree on what can be done to protect patients. Caps will be placed on the financial exposure of patients who receive care from out-of-network providers in situations where the patient is unable to receive care from an in-network provider. However, disagreements remain on what happens to monies in question that are above patient caps. What happens if an out-of-network physician believes he or she is entitled to compensation above and beyond what the health plan would be required to pay? 

Below is a summary of the agreement based on information from the briefing the College attended and from a summary released by the committees. We still have many unanswered questions, and the College continues to advocate for a solution that is fair to both patients and physicians.  

While most of the out-of-network billing limitations being considered by Congress will only affect so-called hospital-based physicians – ER, Radiology, Anesthesiology, Pathology, Hospitalist – there is broad concern within the physician and hospital communities that health plans will seek to limit all out-of-network billing in the future. Consequently, the language agreed to for out-of-network situations could serve as a precedent for future attempts to more broadly limit out-of-network billing. 

  • Limiting patient protections to hospital services: Patient protections only apply to surprise bills for services performed in hospital settings. The agreement would not apply to the physician office setting; however, there is concern that health plans will seek additional state and federal limitations on out-of-network billing – including limits on balance billing for services provided in physician offices.  
  • Limiting patient out-of-pocket costs: Patients will be limited to paying their in-network cost-sharing rate in surprise situations. Physicians and hospitals will not be able to balance bill patients for amounts the patient’s health plan does not cover in surprise situations. Physicians covered by the legislation would be prohibited from balance billing patients for out-of-network services unless the patient is given 72 hours advance notice with a cost estimate and the patient consents to the out-of-network care. 
  • Rate setting: Health plans would be required to reimburse out-of-network providers at the median in-network rate (benchmarked to Jan. 31, 2019) in surprise situations.
  • Independent dispute resolution: Physicians and health plans would have the ability to trigger an independent dispute resolution (IDR) process if they disagree with the median in-network rate. The IDR process would be binding arbitration. Each party would submit an offer and the arbiter will select one or the other based on a set of criteria described in the legislation. The criteria would include the median in-network rate, the provider’s specialty, the provider’s geographic location, extenuating circumstances, such as patient complexity, and the market share of the plan and the provider.
  • IDR threshold: Claims must exceed a $750 in-network payment threshold per CPT code to qualify for the IDR process. This is lower than the $1,250 threshold in the original legislation. It does not appear that providers will have the ability to bundle similar claims to reach the threshold. 
  • Identify the plan type: The Advocacy Council has advocated for Congress to add a requirement for health plans to identify the beneficiary’s plan type (Commercial, ACA, ERISA, etc.) on the beneficiary’s plan card as well as in 835 and 270/271 electronic transactions. This will allow providers to know up front what type of plan is being used and thus, what out-of-network balance billing laws (federal or state) might apply.

The Advocacy Council will continue to monitor and report on this issue as it moves through Congress. We have you covered.