By Mark A. Keroack and Subramony Subramonia-Iyer
With the growing national clamor over how to address healthcare costs in the U.S., one of the greatest ongoing concerns – understandably – has been “surprise medical bills.” We are fortunate to have Congressman Richard Neal’s strong and insightful leadership on this issue, most recently through the bipartisan proposal he is championing as Chair of the House Ways & Means Committee.
Surprise medical bills occur when a patient unknowingly receives medical services at a location, or from a clinician, outside of the patient’s insurance network. The predictable and understandable result is stress, anger, confusion, and despair. When surprise billing occurs, patients are unfairly put in the middle of a matter that should be resolved by their health insurance company and provider.
Hospitals and physicians are united in their belief that patients should never receive a surprise bill and should only be responsible for what they would customarily pay for in-network care as specified by their insurance policy. In an effort to force change on behalf of our patients, the Massachusetts hospital and physician communities are supporting legislative efforts aimed at holding patients harmless, requiring transparency, demanding network adequacy, and simply insisting that information on care and coverage is easily accessible and easy to understand.
The Ways & Means Committee proposal would accomplish these goals. While the full details of the plan are not yet public, the outline the committee offered first and foremost protects patients from surprise billing scenarios. It also respects private market dynamics between insurance companies and healthcare providers by first allowing them to work out differences without undue government interference. If an agreement can’t be reached, the proposal calls for an impartial structured process to settle payment. This approach is the first fair and balanced solution we have yet seen emanate from Congress.
We believe the ultimate solution should be modeled on a 2015 law adopted in New York, which takes patients out of the middle of insurance-provider negotiations.
The New York model relies on “baseball-style” arbitration. If the provider and insurer cannot reach resolution on a payment amount, each side brings their “last, best offer” to the table. The arbiter picks one of the two offers and there is no middle ground. By eliminating the option of modification, it is incumbent upon each side to bring forward realistic, reasonable proposals.
A September 2019 report from New York’s Department of Financial Services found that through 2018, this arbitration approach has saved consumers more than $400 million with respect to emergency services alone. The report deemed the law “a true success in bringing stakeholders together to solve the problem of excessive charges for emergency services and surprise bills.” Arbitration decisions under the law have been pretty evenly split between providers and insurers, and the effects on costs have been positive as well, with the growth of healthcare premiums in New York being significantly less than the national average, and with no premium increases resulting from the surprise billing law.
The surprise billing issue is understandably one of great concern for our patients. We must implement a solution that expands patient protections, and we must do it now. At the same time, we must also preserve and advance patient access to healthcare services.
The Ways & Means proposal provides important protections and transparency for patients without undue government interference in private contracts. It is directly responsive to the priorities of the hospital and physician communities and deserves widespread support. We commend Representative Neal for his extraordinary leadership on this issue.
Mark A. Keroack, MD, MPH, is president & CEO of Baystate Health. Subramony Subramonia-Iyer, MD is president of the Hampden District Medical Society.