It looks like the bill coming out of the House and the Senate this week will include a measure to prevent surprise medical bills. It’s something that’s been in discussion for several years. Trump had put out a presidential decree or something that he was trying to push to have this happen, although it did have the force of law behind it. It needed a House and Senate, needed a Congressional and then signature to become a real bill.
Many of the states over the last few years have been pushing this individually. There’s a bit of a patchwork where probably about 18 states with some form of this in one way or another. It looks like we’ll now have the federal no surprise medical bills coming out shortly.
Why surprise medical bills?
One of the challenges, I think, that has been an issue for many years. The reason why this sort of exists is you have insurance companies who have been driving down rates somewhat unilaterally to the point where, in many ways, providers have determined it doesn’t make sense to take the contract. So they’ve gone out of network. When they go out of network, then whether it’s emergency groups, anesthesia, laboratories, whatever it might be, we do our network services.
I’ve got a baby in the background. My one-year-old is with me at the moment. She’s chatting with me. She just let me know that she’s got a piece of rock in her hand.
The challenges has been that when those providers didn’t choose to go out of network, they effectively balance a bill. Patients and patients are essentially getting stuck in the middle, where the insurance companies in the perception of providers aren’t willing to pay them a reasonable rate for the services. Therefore, they go out of network, and therefore, the patients then get stuck with a large balance bill.
This has been a sticking point like the patients shouldn’t get stuck in the middle. The providers want to get paid a reasonable rate. They believe the insurance companies should be paying more. The insurance companies have effectively said, “No, you’re going to go sticking, and we’ve got the money. Come try to get it!”
Effectively, that’s meant that patients are stuck in the middle now. While everybody has agreed that the patient shouldn’t get the balanced bill, there has been wide-spread disagreement regarding whether or not the insurance companies should pay for that, or the providers should eat it effectively and get paid something like a Medicare rate.
It looks like now, if there are disputes, it will be sent essentially to arbitration. That arbitration is not supposed to consider Medicare or Medicaid contracted rates. It is really the insurance companies were pushing because at those rates, there wouldn’t be much to balance a bill. Those would be in many cases at or below, where the contracted rate would have been anyway. Indeed, not what the providers think is a reasonable rate.
It looks like what’s going to be coming out is that in a win for providers, the arbitration will consider prevailing rates in the area for service and things like that and many other factors but will not include Medicaid or Medicare rates. Also, in a slight upset for the providers, it is not supposed to consider the fee schedule from the provider, which is often inflated, whether that’s 3, 4, 5, 6, sometimes 10 times the Medicare rate. It’s a lot of wax.
That looks like what’s going to be happening, and it looks like we’ll finally have that nationally now. I think that will make significant improvements from a national standpoint. To avoid a bankruptcies that have been occurring as a result of healthcare costs by eliminating that significant issue.