Many state and federal lawmakers are working to address surprise out-of-network medical bills. Proposed legislation targeting surprise OON bills primarily addresses two scenarios: the first is emergency services for an OON facility or an in-network facility with OON physicians; the second is scheduled services for an in-network facility with OON physicians.
Whether legislation designed to address these scenarios will affect a provider's profitability depends on the provider's OON strategy, Zotec leaders Tom Herald, senior vice president of client services, and Mark Isenberg, executive vice president of healthcare advocacy, said during an Aug. 15 webinar hosted by Becker's Hospital Review and sponsored by Zotec Partners.
Providers that bring in revenue through balance billing will likely be more affected by current bills than those that have not. However, depending on the where both state and federal legislators land on the minimum benefit standard (initial payment), all in-network physicians with rates in excess of the MBS are in jeopardy. Carriers may be inclined to terminate existing contracts in excess of the MBS, similar to events in California. Additionally, leaders from these organizations need to be well-informed on the issue and should lobby and advocate on current surprise billing legislation to mitigate revenue challenges, the presenters said.
Federal legislations to consider
Today, at least eight bills (with the likelihood of two more after recess) are being discussed at the federal level to address OON billing. Most of these bills are gaining bipartisan support. Specifically, the Stopping the Outrageous Practice of Surprise Bills Act, authored by Sens. Bill Cassidy, R-La., and Michael Bennet, D-Colo., has gained support from both sides of the aisle with 21 Senate co-sponsors.
Another bill, the Lower Health Care Costs Act, sponsored by Sens. Lamar Alexander, R-Tenn., and Patty Murray, D-Wash., is moving through the Senate and could bring significant changes to OON balance billing. The bill would ban OON billing for emergency care and scheduled services for an in-network facility with OON physicians.
As written, the LHCC Act "could lead to narrow networks, jeopardizing patients' access to emergency care, destroy the market forces that allow for fair, negotiated rates, and give the insurance industry a huge edge in contract negotiations," Mr. Isenberg said.
The LHCC has the MBS targeted at the median in-network rate and does not provide a safeguard, like Independent Dispute Resolution (IDR), to make sure the carriers pay and negotiate in good faith.
Additionally, the House's No Surprises Act was voted out of the Energy and Commerce subcommittee and is likely scheduled for a full House vote after recess. This bill is problematic as it also has median in-network rate as the MBS and while it does contain an IDR safeguard, the threshold of $1,250 is not meaningful as it would allow IDR option on less than 5 percent of most physicians, the presenters said.
State legislations to consider
In 2019, five states passed OON billing legislation: Colorado, New Mexico, Texas, Washington and Nevada. Roughly 25 states are reviewing proposals on the matter.
The bills, which are all designed to hold patients harmless of OON billing, differ greatly on several points, including arbitration; notification requirements for insurers, facilities and physicians; and transparency requirements.
"States are rushing to try to pass these legislations prior to the federal government, because they want their legislation to rule the state versus the federal bill," Mr. Isenberg said. "If your state doesn't have a law in place and the federal bill does pass, that federal legislation would govern everything."
Challenges with implementation
Still, even as some of these legislations pass and move closer to becoming law, successfully implementing each bill's specific policies will be difficult.
For example, implementation will vary significantly depending on whether a state bill allows for Employee Retirement Income Security Act plans to opt into the state regulation. If it does, questions remain around which law would govern which plan. Without the carriers appropriately and clearly identifying the nature of the plan, physician practices would be unable to comply with the laws, the presenters said.
Potentially further complicating the discussion is President Donald Trump's June executive order calling for healthcare price transparency on negotiated rates between hospitals and payers. Hospitals who fail to comply with the proposed rule could be fined $300 per day of noncompliance.
"These are extremely poorly written laws. Everyone is in a rush to get the political credit for it and let state and federal departments work out the details," Mr. Isenberg said. "The challenge is once they're passed, providers have a finite amount of time to comply with those laws, and oftentimes we're seeing various state agencies not live up to their end to provide statement language, notification requirements and defined arbitration processes."
Ways providers can get involved
Providers looking to influence OON billing legislation have several outlets, according to Mr. Isenberg.
One is reaching out to specialty societies to gauge their engagement on the issues. A second is signing up for websites like zotecpac.com to keep abreast of the latest OON surprise billing issues, learn about call to actions and other advocating opportunities. Another is to lobby directly with your elected officials.
"The insurance companies have very deep pockets," Mr. Herald said. "They are pushing very hard on their side of the legislation, trying to make sure it is to their financial advantage. The other side, the physician community, is not as well funded, but usually has a pretty good impact provided that people let their voices be heard."
According to Mr. Isenberg, "Politicians enjoy hearing from constituents, especially regarding healthcare. If you are a physician or work in healthcare, provide them your prospective. Silence equates acceptance."
Find more about Zotec and its OON surprise billing efforts here.
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View a recording of the webinar here.