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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 vote, and then a signature to become an actual bill.

A work in progress

Many of the states over the last few years have been pushing this individually. There’s a bit of a patchwork where there are probably about 18 states. Moreover, they have 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.

One of the challenges, I think, that has been an issue for many years. The reason why this exists is that 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, whether it’s emergency groups, anesthesia, laboratories, or whatever it might be, that is doing our network services.

Stuck in the middle with you

I’ve got a baby in the background. In addition, my one-year-old is with me at the moment. She’s also chatting with me. She just let me know that she’s got a piece of rock in her hand.

One of the challenges, of course, 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.

It’s coming

It looks like it will happen, and this has been a sticking point as everybody agrees that the patients shouldn’t be 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 means that patients are stuck in the middle now. While everybody has agreed that the patient shouldn’t get the balanced bill, there has been widespread disagreement regarding whether or not the insurance companies should pay for that. The providers should eat it effectively and get paid something like a Medicare rate.

What about arbitration?

It looks like now if there are disputes, it will be sent essentially to an arbitration. That arbitration is not supposed to consider Medicare or Medicaid contracted rates, which is really what the insurance companies were pushing for 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 take into account 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 take into account the fee schedule from the provider, which is frequently inflated, whether that’s 3, 4, 5, 6, sometimes 10 times the Medicare rate. It’s a lot of wax.

In conclusion

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 in terms of avoiding a lot of the bankruptcies occurring due to healthcare costs by eliminating that significant issue.