Billing and Collections

Compromise on surprise medical bills is coming, congressional staff say

February 20, 2020 3:27 pm
  • A compromise over determining how surprise-bill legislation will pay providers is nearing,  congressional staff say.
  • The compromise likely will involve financial costs for providers and health plans.
  • Enactment is expected by May 22.

Despite a sharp divide in Congress over how to determine payments in legislation to protect patients from surprise bills, a compromise measure ending the billing practice that is likely to fully satisfy neither hospitals nor health plans is expected to pass, according to staff for some key legislators.

Members of Congress have split among competing proposals to address surprise healthcare bills. Among the leading measures:

  • A House Education and Labor bill would allow health plans to decide payment for out-of-network providers in the first instance of out-of-network costs of $750 or less. Higher charges would be subject to independent dispute resolution guided by the median in-network rate for similar items or services in the same geographic area.
  • A House Ways and Means bill would establish an independent, mediated negotiation process for payment disputes between providers and health plans, guided by the median in-network rates in the area. It has no minimum dollar threshold for bringing disputes.
  • A compromise bill by the House Energy and Commerce Committee and the Senate Health, Education, Labor, and Pensions (HELP) Committee would set payment to physicians at the median in-network negotiated rate in the geographic area, with an option of pursuing arbitration for bills in excess of $750.

The measures have been advancing separately, with the latest activity on each including:

  • December 2019: An agreement was reached by the Senate HELP and House Energy and Commerce committees.
  • Feb. 11: The House Education and Labor Committee approved its bill.
  • Feb. 12: The House Ways and Means Committee approved its bill.

The measures all have had bipartisan support, with hospital and physician advocates backing the Ways and Means approach and health plans opposing any mediation process.

Congressional outlook offers reasons for optimism

Despite the divide over how to pay providers under such a measure, congressional staff addressing a recent healthcare policy gathering in Washington, D.C., said they were optimistic Congress would pass a compromise this year.

“Globally, what I see is that there is clearly a place to land this plane,” said a Senate Democratic staffer, who — like the other staff — asked not to be named.

That optimism echoed earlier expectations that Congress would include language on surprise bills in an end-of-the-year spending bill last year, but that effort was scuttled by disagreement between House Democratic committee chairmen over the best approach.

The specifics of any looming compromise remained unclear, but the staff implied it would be some combination of the existing legislation. The key goals of the compromise are:

  • Improving patient access to care
  • Preserving the healthcare business model
  • Cracking down on what staff described as “opportunistic or rent-seeking behavior by bad actors”

The last point refers to a small number of practices owned by private equity firms that critics say have used surprised bills as a primary feature of their business plans.

The Senate staffer said he expected “a solution that makes everyone a little uncomfortable but doesn’t make anyone so angry that they want to blow up the entire deal.”

The compromise is expected to be included as part of a larger healthcare funding package that Congress would need to enact before various healthcare programs expire May 22.

“The conversations are on their way toward landing said surprise billing plane,” said a House Democratic staff member.

Another driver of the legislation is Congressional Budget Office (CBO) projections that barring surprise bills would produce federal savings. The projections derive from the expectation that eliminating surprise bills would lower costs for individual-market health plans, which in turn would reduce their required level of federal subsidies. Those savings were expected to be used to fund other elements of the May healthcare package, such as extending several Medicare programs.

CBO projected the Ways and Means bill would save $17.8 billion.

Looming details concern impact on state approaches

Among the additional details that need to be resolved in congressional negotiations is how the legislation will treat existing state laws that address surprise billing. States have taken a variety of approaches to determining how providers will be paid in such circumstances, and some members of Congress want to preserve those measures even if only for plans regulated by the state.



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