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Surprise Deal to Protect Patients From Surprise Medical Bills

Michael Rainey

After struggling for months to reach consensus, a bipartisan, bicameral group of lawmakers announced Sunday evening they had come to an agreement on legislation that would protect patients from surprise medical bills. The proposal potentially could be attached to a must-pass package to fund the government by December 20, but some significant obstacles remain.

While some critical details are still being ironed out, the Lower Health Care Costs Act of 2019 would reportedly ban surprise bills from doctors working at hospitals that are covered by a patient’s health insurance, and create an arbitration system for billing disputes between medical service providers and insurers. Bills under $750 would be settled at a standard rate based on the average paid for the service in that area. Bills for more than $750 could go to binding arbitration.

The proposal would also ban balance billing for air ambulances, with a threshold for arbitration set at $25,000.

The legislation contains additional provisions that could help it gain wider support, including nearly $20 billion in funding for roughly 1,400 Community Health Centers over five years, an increase in the purchasing age of tobacco to 21 and measures to lower drug prices.

Powerful combatants: While there’s widespread agreement that the issue needs attention from Congress, and the White House has pushed for a bill, powerful interest groups have pushed back against the months-long effort to rein in surprise bills. Insurers would prefer to use price benchmarks, but health-care providers say standardized prices would give insurers too much power, and conservative lawmakers have expressed concerns about rate-setting by the government. Some providers, on the other hand, want to see an arbitration system to resolve disputes. An earlier effort to reach a deal was scuttled this past summer, in part due to the lobbying efforts of a group of private equity investors who own provider staffing firms. (For more on that story, see this piece at The New York Times.)

Not everyone is on board: Although several key lawmakers — including Frank Pallone Jr. (D-NJ) and Rep. Greg Walden (R-OR) of the House Energy and Commerce Committee, and Sen. Lamar Alexander (R-TN) of the Senate Health Committee — say they back the deal, Sen. Patty Murray (D-WA), the top Democrat on the Senate Health Committee, has not indicated that she supports it. "Senator Murray believes the overall agreement takes important steps forward on a number of issues impacting patients and families, and is working with some members of her caucus on concerns they still have," a Murray spokesperson said.

And there’s already industry pushback: The Greater New York Hospital Association said Monday that the proposal “includes needless provisions that benefit for-profit insurers while severely harming hospitals and physicians.” The group also criticized the hurried nature of the effort, describing the “rush to get surprise billing language into an end-of-year funding bill” as “dangerous and unnecessary.”

The bottom line: The agreement renews hope that some kind of legislation will pass to address an urgent health care problem, but there are still details to iron out and time is running short.

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