In a rare display of unity, President Donald Trump and bipartisan Congressional leaders have highlighted their shared commitment to tackling “surprise” medical billing – when an insured patient is subject to unexpectedly high out-of-pocket costs for out-of-network care that is beyond their control.  Such surprise billing can occur when a patient receives emergency care from an out-of-network provider but they could not choose their provider, or when a patient is treated at an in-network hospital but the anesthesiologist or another provider is out of network.

On May 9, 2019, the White House held an event to highlight the economic burden surprise billing can have on patients and set the following forth principles for a legislative solution, including:

  • Patients receiving emergency care should not be forced to shoulder extra costs billed by a care provider but not covered by their insurer. In emergency situations, balance billing for amounts above the in-network allowed amount should be prohibited.
  • Patients receiving scheduled care should have information about whether providers are in or out of their network and what costs they may face.
  • Patients should not receive surprise bills from out-of-network providers they did not choose.
  • Federal healthcare expenditures should not increase.

President Trump indicated in his remarks that the Administration would be releasing a more detailed “transparency” proposal over the next two weeks or so.  In response to the Administration’s announcement, key lawmakers in both parties expressed support for legislative action on this issue.  For instance, House Energy and Commerce Chairman Frank Pallone, Jr and Ranking Member Greg Walden released a joint statement committing to crafting bipartisan legislation to address surprise billing, and Senate Health, Education, Labor, and Pensions Committee Chairman Lamar Alexander stated his goal of having a bipartisan solution on the Senate floor by July.

Yet even with bipartisan recognition of the problem, crafting a federal solution is expected to be complex.  In addition to determining how to balance state and federal roles in regulation of insurance practices, it will be important for legislators to understand how reimbursement rates are set in the private sector, how charges may differ from actual costs, the complicated dynamics of negotiations between payers and hospital-based physicians, and the role cost shifting continues to play in the health care system as a whole.  Moreover, stakeholders – which include employers, patients, physicians, hospitals and insurers — are likely to be sharply divided on potential remedies, such as holding patients harmless for charges, banning balance billing, limiting reimbursement rates for out-of-network providers, prohibiting out-of-network/in-network distinctions for emergency care, and requiring binding arbitration to resolve disputes between payers and providers.  Even with the political will to act quickly, finding a legislative cure may take a more methodical approach.