Congress Is on the Verge of Banning Surprise Medical Bills

The average surprise bill for an emergency room visit is $628—a significant amount in a country where most people live paycheck to paycheck.

It’s a bird… It’s a plane… It’s Congress actually doing something to address the epidemic of unexpected medical bills that have harmed millions of Americans.

On Sunday, news broke that congressional leaders from both parties reached an agreement on a $900 billion coronavirus relief bill that provides a fresh round of federal unemployment benefits, direct payments to most Americans, and money for small businesses, schools, child care, and vaccine distribution. Also included in the bill is a measure to finally ban “surprise billing from healthcare providers.

Every year, millions of Americans check into a hospital that accepts their insurance, receive care, and go home, expecting their treatment to be covered. But in some cases, those patients receive care from an emergency room doctor or anesthesiologist who does not accept their insurance, meaning they can bill the patients for fees far above what their insurance plan usually pays.

Over a 12-month period in 2017-2018, an estimated 39% of insured adults ages 18-64 said they had received an unexpected medical bill after getting care from a doctor, hospital, or lab that they thought was covered under their insurance, according to a 2018 study from the Kaiser Family Foundation. The average surprise bill for an emergency room visit is $628—a large amount in a country where most people live paycheck to paycheck. In some cases, patients have received bills for more than $100,000 from out-of-network doctors that they did not choose. 

In total, roughly 1 in every 6 emergency room or in-hospital stays resulted in at least one out-of-network medical bill in 2017, according to Kaiser.

This epidemic of “surprise billing” became a hot-button issue in recent years. An overwhelming majority of adults (80%) want the practice banned, according to a new survey from Kaiser. Members of both political parties have pushed to end the practice, but have fallen short due to opposition from well-funded medical interests, including hospitals and doctors who benefit from the existing system, as well as private equity firms who own many of the providers that send surprise bills.

But things finally appear to be changing. Assuming the coronavirus relief deal passes through the House and Senate and is signed into law by President Donald Trump, surprise bills will soon be a thing of the past. 

Instead of charging patients, providers will now have to negotiate with insurers to settle on a fair price. If the two sides are unable to agree on a payment rate, they must use an outside arbiter to determine a fair payment rate based on a variety of factors, including what other doctors and hospitals bill for similar services, prior contracts, and the complexity of services rendered. Under the impending law, the only way patients could be billed by out-of-network providers for the balance is if they provided notice of their network status and an estimate of charges 72 hours in advance, and got consent from the patient to receive out-of-network care.

Otherwise, patients can only be billed for the kind of cost they would typically pay for in-network services, but nothing greater than that. 

The new changes are set to go into effect in 2022, and will apply to doctors, hospitals, and air ambulances (but not ground ambulances). 

While the effort received criticism from some organizations representing hospitals and providers, the bill was cheered on by healthcare advocacy groups.

“Passage of this bill will mark a tremendous victory for consumers who have been caught in a battle between providers and insurers over payment practices for far too long. Out-of-network balance billing is an egregious, unfair practice that leaves families subject to financial ruin through no fault of their own,” Jen Taylor, senior director of Federal Relations at Families USA, told COURIER in a statement. “While no compromise is perfect, this bill will provide real protection for real people, and makes important progress in moving toward a more fair and transparent health care system for everyone.”