Both the American Academy of Orthopaedic Surgeons (AAOS) and the North American Spine Society (NASS) have praised an extremely rare tri-partisan Washington initiative (Democrats and Republican in Congress; President Trump) to act on the sometimes-huge surprise medical bills patients receive after surgery.
At the same time, Trump was expected to issue an executive order, possibly this work week (May 28-31) which would require caregivers to publicly post prices and might send the Justice Department after so-called regional health care monopolies (see below).
“Surprise billing” generally means billing after a procedure by an out-of-network provider for amounts not covered by the insurer; it happens most often when a patient goes to an in-network hospital, thinking that everything is covered, but is treated by an out-of-network physician.
On Capitol Hill, it’s not all roses yet; the guns could still come out, given the volatility of Washington politics and the fact that there are several competing proposals.
One widely backed initiative, which AAOS praised, is a “framework” for legislation proposed by U.S. Representatives Raul Ruiz, M.D. (D-CA), Ami Bera, M.D. (D-CA), Donna Shalala (D-FL), Phil Roe, M.D. (R-TN), Larry Bucshon, M.D. (R-IN), Joseph Morelle (R-NY), Van Taylor (R-TX) and Brad Wenstrup, D.P.M. (R-OH).
Their proposal would be modeled on an existing New York system, in which so-called “surprise bills” are subject to arbitration between the insurer and the provider. It has “ successfully reduced out-of-network bills by 34 percent,” AAOS says.
So, if out-of-network surgeons would end up being paid less, why is AAOS supporting the idea?
The answer lies in AAOS’ May 21 written testimony at a House Ways and Means Committee hearing. The core of the problem, AAOS said, is insurers’ extremely limited provider networks and hidden information. AAOS’ statement said:
“To ensure network adequacy, any proposal should require insurers to:
- Design networks with a specific minimum number of active primary care and specialty physicians available, adjusted by appropriate population density and geographically impacted factors;
- Maintain and robustly enforce accurate and timely physician directories to prevent carriers from continuing to provide patients with inaccurate directories;
- Provide accurate and timely fee schedules to patients and physicians to improve cost transparency;
- Offer out-of-network options to ensure that patients have choices when their network does not offer access to the physicians patients need; and
- When there are no specialists in a network who can meet a patient’s need and a non-network provider must deliver specialty care, insurers should compensate those providers at their full fee. In these cases, the insurer has created an inadequate network, and they should bear the entire responsibility of ensuring patient access outside of what is available in the network.”
“In addition,” AAOS said, “states have a patchwork of network adequacy laws and regulations, with varying staff sizes, proactivity/reactivity in monitoring and politicization of the insurance commissioner role. Enforcing network adequacy requirements is essential.”
The problem of surprise billing is especially acute “during a time when rapid market consolidation is driving up costs, decreasing patient choice, and inhibiting industry competition.”
“The AAOS applauds Reps. Raul Ruiz (D-CA), Phil Roe (R-TN), and others for drafting a proposal that protects patients from these ‘surprise bills’ while preserving a fair playing field for resolving disputes. By removing patients from the middle and allowing for ‘baseball-style’ arbitration, the Protecting People from Surprise Billing Act incentivizes insurers and providers to come to the table and negotiate a fair rate.”
NASS said, “We believe that patients should only be responsible for in-network cost-sharing when experiencing unanticipated medical bills and that patients should not be burdened with payment rate negotiations between insurers and providers.
NASS offered this cautionary note: “At the same time, medical professionals and other providers are limited in their ability to help patients avoid these unanticipated costs because they, too, may not know in advance who will be involved in an episode of care, let alone other providers’ contract status with all the insurance plans in their communities.”
The possible Trump order goes beyond price disclosure
The Wall Street Journal, citing sources close to the discussion, said the possible Trump order might use powers of more than one federal agency to force “a host of players in the industry” to reveal to both employers and consumers the discounted rates negotiated between insurers and providers.
The order could direct federal agencies to pursue actions to force a host of players in the industry to divulge cost data, the people said.
The Journal said the Administration is also considering using agencies such as the Justice Department to take as-yet-undefined actions against regional monopolies of hospitals and health-insurance plans on the belief that they’re driving up the cost of care.
The White House declined to comment. Industry groups told the Journal that legal challenges are possible.
