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Surprising Swings In Momentum For Legislation On Surprise Medical Bills

Surprise bills have in recent months been viewed as public enemy No. 1 on Capitol Hill. (Moment/Getty Images)

After months of hearings and negotiations, millions of dollars in attack ads, full-court press lobbying efforts and countless rounds of negotiations, Congress appeared to be moving toward a solution to the nation鈥檚 surprise medical bill problem. Sort of.

Surprise bills, the often-exorbitant medical bills that come when a patient doesn鈥檛 realize they鈥檝e been seen by a provider outside their insurance network, have in recent months been viewed as public enemy No. 1 on Capitol Hill.

Two committees, the Senate Health, Education, Labor and Pensions (HELP) Committee and the House Energy and Commerce Committee, have been working on plans and announced a compromise Dec. 8. Later that week, the House Ways and Means Committee followed suit by announcing its solution, though .

It鈥檚 been a heavy lift for lawmakers in both parties who are trying to balance the competing needs of powerful stakeholders, factions within their ranks and consumers stuck with high bills. With an election year fast approaching and showing health care costs are a high priority for voters, the push for action has intensified.

Time Is Not Of The Essence

Despite the rushed way some committee members announced the Dec. 8 鈥 issuing a press release on a Sunday before any official bill text was released 鈥 it鈥檚 now unlikely that Congress will consider the package before it wraps up work for the year.

HELP Committee Chairman Lamar Alexander (R-Tenn.) signaled as much Monday in a press release in which he promised to do everything he could to keep the surprise medical bill issue at the top of the congressional to-do list for 2020 鈥 until it鈥檚 solved. 鈥淭he only people who don鈥檛 want this fixed are the people who benefit from these excessive fees,鈥 he said.

Still, the recent signs of progress are significant, even if final passage happens early next year, said Loren Adler, the associate director of USC-Brookings Schaeffer Initiative for Health Policy, a research group.

Even if Congress punts it to February or March, 鈥渢here鈥檚 a decent shot of getting it done,鈥 Adler said. 鈥淚t would be pretty darn embarrassing if Congress doesn鈥檛 pass it after talking about it this long and it being such an egregious problem.鈥

Compromise Bill

The HELP/Energy and Commerce legislative outline shows movement toward compromise on several fronts, from omitting the controversial 鈥渁ll-payer claims database鈥 鈥 a federal repository for health-pricing information 鈥 to adding more public health provisions.

It includes Senate protections against surprise bills from air ambulances, while adopting most of the House鈥檚 approach to hospital bills, down to preserving the House鈥檚 title for that section.

鈥淎 sign of a compromise is that nobody particularly loves it,鈥 Adler said.

Over the past few months, the biggest debate around remedies for surprise bills has centered on how to determine payment for out-of-network doctors and hospitals. One group wanted an arbitration process while the other sought a benchmark system. It seems neither side got exactly what they were seeking.

Under benchmarking, the government would set a compensation rate for providers when they see out-of-network patients. The most popular proposition was one that paid a 鈥渕edian in-network鈥 rate, when doctors are paid in the middle of the range of what others in the area are paid by insurance companies for the same service.

The other idea was independent dispute resolution, or arbitration. The provider and insurer bring their best offer to a third party, who chooses between the two.

Generally, employers and consumer advocates favor benchmarking. Hospitals and doctors鈥 groups, especially those backed by private equity firms, pushed for arbitration.

The compromise approach tracks closely with legislation advanced by the House Energy and Commerce Committee: a median in-network benchmark with an arbitration 鈥渟afety valve鈥 where either side can bring a bill to arbitration if it鈥檚 more than $750. Previous versions allowed arbitration only for charges over $1,250.

鈥淚 think what we鈥檝e seen come out recently is probably what a reasonable bettor would have predicted,鈥 said Benedic Ippolito, a research fellow in economic policy studies at the American Enterprise Institute.

This proposal is seen as more favorable than earlier HELP Committee drafts to providers because it allows them to go to arbitration for more bills, but to these stakeholders, it鈥檚 not enough.

鈥淲ithout an arbitration mechanism that applies to a legitimate number of claims, the concerns raised by the provider community will persist,鈥 read a statement from Envision Healthcare, a physician staffing firm. A large number of surprise bills are generated by physicians employed by such staffing companies, which are often backed by private equity firms. The business model allows these doctors 鈥 often specialists including emergency medicine and radiology, among others 鈥 to set their own rates because they don鈥檛 work for the hospital.

, , Association of American Medical Colleges and Greater New York Hospital Association have also pushed back.

To be fair, plenty of groups have come out in support of the compromise. A message from the Energy and Commerce Committee noted that signed a letter of support.

James Gelfand, a senior vice president at the ERISA Industry Committee, which represents large employers, said the compromise isn鈥檛 what his constituents would have written to solve surprise medical billing, but he thinks it鈥檚 still important to pass, and parties who keep demanding changes are just trying to stall.

鈥淲e hate arbitration, and we believe the changes made to please 鈥榯eam arbitration鈥 will raise costs tens of billions of dollars,鈥 Gelfand said. 鈥淏ut we support the bill. We want to get it across the finish line.鈥

The blueprint offered by the Ways and Means Committee is considered friendly to providers because it lays out a system similar to arbitration and favors a go-slow approach. A press release from panel Republicans indicated that stakeholders need to 鈥渟tay at the table and debate these ideas鈥 into the new year.

To some, it felt like a delay tactic.

鈥淲e know that pushing legislative action into 2020 pushes the work into a difficult presidential election year and makes it harder for Congress to act. This would dramatically increase the odds that Congress will fail to enact meaningful legislation to ban surprise medical bills and fail our nation鈥檚 families,鈥 Frederick Isasi, executive director of the advocacy group Families USA, said in a written statement.

Money And Momentum

Political muscle could also factor into the measure鈥檚 momentum.

Money from private equity has been flowing into the debate, from millions of dollars spent on commercials and online ads, to campaign donations.

According to OpenSecrets data, Rep. Richard Neal (D-Mass.), the chairman of the Ways and Means Committee and one of the voices calling for more time on surprise billing, received $ Group, the private equity firm that owns TeamHealth, a physician-staffing firm. This was the first year ever that Blackstone was in Neal鈥檚 top five donors.

Rep. Kevin Brady (R-Texas), that panel鈥檚 ranking member, received , the private equity firm that owns several staffing companies, including US Acute Care Solutions, U.S. Anesthesia Partners and US Radiology Specialists. U.S. Anesthesia Partners was one of Brady鈥檚 top contributors last year as well,

Sen. Bill Cassidy (R-La.) has been one of the strongest proponents of an arbitration safety valve on the HELP Committee. He received from Welsh, Carson, Anderson and Stowe.

Neither 听nor , the ranking member of HELP, reported similar donations from private equity firms. The same was true for , the chairman of Energy and Commerce, and , the ranking member of that committee.

Looking to the future, many questions still need to be answered about how these proposals will shape up.

鈥淲hether this is a good or bad solution to surprise medical billing will depend on how the arbitration system evolves over time,鈥 Ippolito said.

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