Honor the No Surprises Act as it is written

While it is widely accepted that surprise medical billing is a toxic practice that required a legislative solution, surprise medical billing legislation can have two effects. The first is intuitive: it limits the problem of surprise medical billing. The second is less obvious, but insurance companies use it to their advantage. Legislation to stop surprise medical billing can be used to disrupt good faith negotiations between doctors and insurance companies.

The No Surprises Act (NSA), which is due to come into force in early 2022, was drafted to end surprise medical billing, protecting patients while preserving good faith negotiations between insurance companies and doctors. Insurers and their lobbyists have pushed for a benchmark approach, using their rates to assess a service for reimbursement. Such an approach gives them the advantage in negotiations.

Instead, the law passed by Congress did everything possible to preserve the balance, favoring neither insurers nor doctors. The law takes patients out of the midst of reimbursement disputes between insurers and doctors, and directs these groups to negotiate an agreement themselves. And if they can’t come to an agreement, they call in an independent, non-confrontational arbitrator.

The referee’s orientation also reflects this desire for balance. For example, physicians cannot submit their billed fees for review, while insurers cannot submit rates to public payers. For context, the House Ways and Means Committee wanted to use an arbitrage method and the House Energy and Commerce Committee wanted to use a benchmark approach based on the network median rate. The compromise was to use arbitrage but include the midpoint in the network as an uncompensated item in the arbitration criteria. It was a solution that no one liked but that everyone could live with.

Then with a Provisional final rule the administration amended the law by making the network’s median rate the default payment rate, changing the law from a law based on arbitration to one that was essentially a benchmark law. Change prompted several pursuits.

The defense of change is almost comical. Since the law never said that the networked median rate should be the default payout rate, regulators needed a rationale to justify action. A main part of their response was “Well, in the list of arbitration criteria, that was the first one.” Seriously? Since the networked median rate, known as the qualifying payment amount (QPA), has other features in the law, it doesn’t seem unreasonable to name it first in the list of factors to consider. in arbitration.

The NSA never indicates that a factor has a priority weight. Indeed, the president and eminent member of the House Ways and Means Committee were clear that “law enacted by Congress directs the arbitrator to consider all factors without giving preference or priority to a single factor.” Their committee was a committee of competence and necessary to move the bill forward. The administrations’ interim final rule ignores both the letter and the letter of the law, distorting it in favor of insurance companies.

Other than increasing the profitability of insurance companies, there is no reason to change the law. The law as drafted, using arbitration criteria, already addresses the issue of “aberrant practices” which charge exceptionally high tariffs. As for cost savings, the NSA save billions of dollars over the next decade. New York State reported that their law, steeped in arbitration like the NSA, has saved consumers hundreds of millions of dollars, reduced network tariffs and surprise medical bills. And their law includes the 80th percentile of charges in its arbitration criteria, which the NSA does not, implying that the NSA would save even more money.

Also, while insurers are empowered to cut payments, what percentage of those savings should be passed on to consumers? Nothing. It may reduce premiums, but by how much? 20%? ten%? No; 1% (or less). For reference, between 2000 and 2020, employer sponsored health insurance premiums more than tripled.

This is not the first or second time that insurance companies have tried to use this question to improve their profit margins. In 2009, a large insurance company was caught using a “fraudulent and conflicted reimbursement system affecting millions of patients and their families and costing Americans hundreds of millions of dollars in unexpected and unfair medical bills.” In addition, the research paper that insurers have presented as evidence has been called into question due to undisclosed connections with an insurer who helped direct his story.

In a recent editorial, supporters of the Interim Final Rule overlook key factors. First, they suggest that many physicians are voluntarily choosing to engage in surprise billing. But few medical organizations choose an exit strategy from the network to preferentially bill patients. Often insurers do not negotiate in good faith (or not at all) with firms, preventing them from being part of the network.

In addition, the article implies that the only advantage of network contracts is the increase in volume. However, many hospitals require, or strongly suggest, that their doctors network with the health plans that the hospital contracts with. Insurers know this, which gives them an advantage in contract negotiations. Beyond that, being in a network makes the payment process faster, easier and less expensive. To delay payments, insurers often require out-of-network physicians to make an effort to be reimbursed. In addition, certain hospital specialties, such as radiology, also serve a population of outpatients, so being in a network is important for their volume, just as it is for primary care.

Finally, the editorial asserts that medical offices that are fully networked, have never sent a surprise bill and have always acted in good faith will be immune to the amended law. This is not the case. A benchmark law allows insurers to push patients from the network and doctors out of the network. Insurers may demand unrealistic reductions with take-it-or-leave-it offers. Proof? A few weeks after the provisional final rule, networking practices began to receive such letters threatening contract termination and specifically referring to the NSA and the Interim Final Rule. These threats are made during a public health emergency, many patients and practices being in difficulty and insurers are already reaping them. dizzying profits.

Disrupting good faith negotiations and causing insurance companies to push patients and providers out of the network was exactly what the NSA tried to avoid. The right thing for the administration to do is admit the error and correct it. Implement the law as it is written, taking into account all arbitration criteria in the same way. This will further increase the profitability of insurers, but perhaps not as much as they would like. But more importantly, it would honor the law that was passed and help protect both patients and doctors.

Naveen Parti, MD, MBA, is a radiologist in South Carolina and an assistant professor at the Greenville School of Medicine.

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