Solving surprise medical billing the right way
Congress seems poised to address a pervasive issue that has for too long taken its toll on patients in our health care system — surprise medical billing. However, as it seeks to address this problem, our senators and representatives must take heed not to implement legislative solutions that would encourage government interference in the free market — thereby driving up costs and diminishing access to quality care.
Surprise medical billing usually happens weeks after a patient receives out-of-network care. It can happen when a patient is treated at a hospital or emergency room that is not in their network or even at an in-network facility if the doctor providing care happens to be out-of-network, as is often the case given insurance companies’ continued narrowing of provider networks. Regardless of how it happens, the outcome is the same: patients get stuck with sky-high medical bills for the cost of care not covered by their insurance plan. Suddenly, these patients find themselves stuck in the middle of a billing dispute between their health care providers and insurance companies.
No one should ever be put in this situation, which is why it’s good news that Congress is inching closer to passing federal legislation to address this issue. However, some purported solutions being considered by our elected officials would take a dangerous approach to protecting patients by using a form of benchmarking, which would essentially lead to government rate-setting — something that any true conservative should stand steadfastly against. [Houston Chronicle Editorial: Texans off the hook for surprise medical billing.]
Allowing government bureaucrats to set prices for out-of-network health care providers across the country is a total abandonment of the free-market values that have helped create such a robust health care system in which roughly 90 percent of Americans enjoy comprehensive health care coverage and benefits. This move toward increasing regulations and growing the size of the federal government is no solution — in fact, it would only create more problems than it solves.
Government rate-setting under this benchmarking approach would ignore the fact that the cost and level of difficulty for performing health care services and treatments varies greatly by region and facility. By setting artificially lower-than-market rates for these services, doctors would essentially be short-changed for the invaluable services they provide. These losses would simply be passed on to our nation’s hospitals and emergency rooms — threatening the financial stability of rural health care facilities in particular.
This could all work to worsen the current epidemic of provider consolidation — both among hospitals and physicians — limiting choice, threatening access, and resulting in higher costs for patients. Moreover, if the government is setting these arbitrarily low rates for physicians, then insurance companies will have no incentive to grow their provider networks and will have more power to dictate the kind of medical care patients can access. This is too high a price to pay. Yes, we need to end surprise billing, but we need to do it the right way — a way that allows the free market to do what it does best: encourage competition and choice while lowering costs.
Fortunately, there are other solutions in Congress that take a more pragmatic approach. Instead of benchmarking, legislation like S. 1531, the STOP Surprise Medical Bills Act, would seek to implement an Independent Dispute Resolution process in order to eliminate surprise medical billing. That’s the same process used in Major League Baseball to settle salary disputes between players and teams.
This approach incentivizes both parties to submit a fair offer for the price of medical services, which incentives them to keep prices down so their offer is chosen. This process takes about 30 days through an online portal, and the patient is left out of the process completely. Until such a time that a final payment is determined, insurers pay providers a temporary interim payment based on the fair market value of the services provided. That provides a layer of financial security that can make all the difference to rural hospitals that operate on razor-thin profit margins.
Independent Dispute Resolution has been proven effective in New York, where state legislators passed it as part of a bill to protect New Yorkers from surprise medical billing. It is now time for Congress to pass a similar measure. Texas Sens. Ted Cruz and John Cornyn, along with the entire congressional delegation from the Lone Star State, must help ensure that the final legislation Congress passes to end surprise medical billing includes this approach to help protect patient access, choice, and quality of care.