The AMA took aim at the payer industry, stating that payers are too reluctant to compromise over surprise medical billing legislative fixes.
Surprise medical billing legislation is under the microscope again, this time with the American Medical Association offering cutting words for a payer industry that AMA says is reluctant to reach a compromise.
In recent months, Congress has been at work developing legislative proposals that would put an end to surprise medical billing, a phenomenon that arises when a patient receives a charge they did not think they would receive or did not believe would be so high.
These bills have centered on the notion that patients must be protected from surprise medical bills, with payers, providers, and legislators agreeing that patients should not be liable for a full, out-of-network healthcare bill.
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As such, most bills rule that patients will only be liable for their typical, in-network copayment, even if they inadvertently receive care in an out-of-network setting or from an out-of-network provider.
But that’s about where the agreement ends, with hospitals and payers sparring over how they will settle the rest of the medical bill. Payers largely favor a benchmarked payment system while providers say an independent dispute resolution (IDR) would be best.
That debate came to a head last week when the AMA issued a letter critiquing the payer industry’s seeming reluctance to come to a compromise in one proposed bill. Citing the House Energy and Commerce Committee legislation “No Surprises Act,” AMA said the payer industry, represented by America’s Health Insurance Plans (AHIP), was mischaracterizing the resolution process.
The bill primarily uses a benchmark payment structure to resolve out-of-network bills, leveraging the median contracted rate. This means that if a patient inadvertently receives care in a facility outside of their network, they will still be charged their in-network copayment. The hospital will be paid the median contracted rate for that payer in that region for that service.
In cases where the median contracted rate does not quell disputes between payers and providers (for example, if that rate is egregiously low for that specific patient case), they may resort to IDR.
IDR refers to the “baseball style” arbitration that has been so frequently referenced in surprise billing debates. In these cases, both payer and provider will name what they consider a fair price, and a third-party mediator will select which price is most accurate for the specific case.
“Such models have been successfully implemented in several states and are a proven solution to resolving these disputes while fully protecting the patient,” wrote James L. Madara, MD, the CEO and executive vice president of AMA.
“In fact, despite political advertisements stating otherwise, the patient is in no way involved or affected by a decision by either party to engage in the IDR process.”
But the payer industry is not exactly on board, with AHIP issuing a statement saying that the arbitration amendment to the Energy and Commerce bill will put patients in harm’s way.
“It is discouraging, however, that America’s Health Insurance Plans (AHIP) declared that the Committee’s actions would allow providers to ‘price gouge patients,’” Madara wrote in a letter to committee leaders Frank Pallone and Greg Walden.
“This is a clear mischaracterization of the actions taken by the Committee. Under the Committee’s bill, no patient who receives a surprise bill would be obligated to pay more than if they received care by an in-network provider—identical to the protection provided by a previous version of the bill supported by health plans.”
Per AHIP’s statements, an IDR would give provider groups the power to increase the cost of a certain healthcare service, which does not get to the heart of the healthcare cost issue. IDR would inflate the cost of care for patients, AHIP stated, because it would allow hospitals to set high prices.
But that is not the case, AMA countered, because the bill specifically states that patients would only be held liable for their insurance premiums. Additionally, the bill’s verbiage still favors the health insurance industry, Madara stated.
“AHIP’s angst apparently results from the fact that the ‘baseball style’ arbitration adopted by the Committee, like New York’s successful system, would allow an independent third party to determine whether the plan payment amount or the provider bill represents the most appropriate resolution to the claim,” he noted. “This mischaracterization of the Committee’s actions is doubly confusing because the language adopted by the Committee is still heavily skewed to the benefit of health plans.”
To be fair, AMA explained that not all health plans feel the way AHIP does. Health plans in New York, which AMA noted has successfully adopted IDR to quell surprise medical billing, are on board with the practice and have advocated for more providers to benefit from the arbitration system.
Texas health insurers, including Blue Cross Blue Shield of Texas, have likewise boasted the success of their arbitration processes.
Nonetheless, this debate has become crippling as legislators seek a viable solution to the surprise medical billing issue, Madara suggested.
AMA also took note of some payer groups, including the Blue Cross Blue Shield Association, stating that the arbitration process would be cumbersome. AMA pointed out that New York’s system simply requires both payers and providers to fill out a two-page form, which is in stark contrast to the administrative burden that providers face when completing prior authorizations, AMA said.
“The actions of the Committee on Energy and Commerce are an important acknowledgement that the Committee’s original proposal will benefit by adding a backstop process should the underlying methodology fail to arrive at a resolution that was fair to both parties,” Madara concluded.
“The Committee took no action that in any way weakened the crucial patient protections enshrined in the original proposal. It is a critical step and we look forward to working with Congress to further refine this key element of the bill as the process moves forward.”
Date: August 5, 2019
Source: Patient Engagement Hit