Physician-backed surprise-billing solution would boost deficit by billions, CBO says

A surprise medical bill arbitration solution supported by physician groups would increase the deficit by tens of billions of dollars over a decade, according to a Congressional Budget Office email obtained by The Hill.

Congress has been considering legislation to address surprise medical bills, with the key sticking point among healthcare stakeholders being how to resolve out-of-network payment disputes between insurance companies and physicians once the patient is protected. Two ideas under consideration are reimbursing providers based on federally set benchmark rates and using arbitration.  

The CBO email — from the CBO to a congressional office — analyzes both the benchmark rate and arbitration solutions.

The analysis showed that  physician-backed surprise-billing legislation from U.S. Reps. Raul Ruiz, D-Calif., and Phil Roe, R-Tenn., which would allow an arbitrator to decide the out-of-network payment amount, taking into account physician charges prior to insurer negotiations, would cost "double digit billions" of dollars over a decade, according to The Hill. The CBO cited the effects of a similar approach in New York state, which the nonpartisan federal agency said boosted physician payments "as much as 5 percent in response to the policy."

On the flip side, The Hill reported that the CBO found House Energy and Commerce and Senate Health committee bills, which essentially use the benchmark approach to set payments to physicians, would both save more than $20 billion over a decade.

In response to the CBO's findings, Mr. Roe told the Hill : "My biggest concern is we will enact a bad policy that makes the practice of medicine more difficult and more complex based on a [CBO] score that is likely to be wrong because of how much it conflicts with real world practices."

Congress is back in session after the August recess, although lawmakers have yet to reach an overall agreement on surprise-billing legislation.


More articles on healthcare finance: 

Fee-for-service payments still account for most physician practice revenue, AMA finds
Insurers are to blame for surprise medical bills, physician-staffing company exec says
CMS price transparency effort falls short, Nebraska hospital CFOs say

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