End of Year Flurry of Congressional Activity on Surprise Billing

King & Spalding
Contact

Despite a year-end push, Congress will not resolve the surprise billing issue until the first quarter of 2020, at the earliest. On Wednesday, December 11, 2019, House Ways and Means Committee Chairman Richard Neal (D-MA) and Ranking Minority Member Kevin Brady (R-TX) announced they had reached a bipartisan agreement to provide patient protection from surprise billing. The Ways and Means proposal followed days after the announcement of a bipartisan, bicameral compromise agreement between House Energy and Commerce Committee (E&C) Chairman Frank Pallone (D-NJ) and Greg Walden (R-OR) and Senate Health, Education, Labor and Pensions (HELP) Committee Chairman Lamar Alexander (R-TN).

The key point of conflict between the proposals concerns plan reimbursement of out-of-network providers in surprise billing scenarios. The E&C-HELP plan would require insurers to pay an in-network market-based rate, subject to elective binding arbitration if that rate exceeds a threshold. The Ways and Means proposal would instead implement a different process which “respects the private market dynamics between insurance plans and providers” by first calling for insurers and providers to work out differences on their own without interference. If that fails, the parties have available an independent resolution process, though the details of the process are not set forth in Ways and Means’ preliminary proposal.

“Surprise billing” occurs when a patient receives out-of-network emergency services or receives care from out-of-network clinician while being treated at an in-network hospital, resulting in an unexpectedly high out-of-network bill.

The December 8, 2019 E&C-HELP plan to address surprise medical billing would be similar to the E&C’s “No Surprises Act” introduced in the House earlier this year (H.R. 3630). The new, bipartisan compromise would limit patient cost-share for out-of-network emergency care and certain out-of-network care provided at in-network facilities to an in-network amount to be attributed to the patient’s in-network deductible. The proposal would also set payer rates for out-of-network care in surprise billing scenarios to a median in-network rate in the geographic area. This reimbursement rate would be subject to appeal by either provider or insurer if the median in-network rate was greater than $750, which would be resolved in “baseball-style, binding arbitration” referred to as “Independent Dispute Resolution (IDR).” IDR would consider the “training, education and experience of the provider, the market share of the parties, and other extenuating factors such as patient acuity and the complexity of furnishing the item or service.” It is unclear whether the median in-network rate would factor into arbitration. The White House expressed support for this bipartisan compromise on December 9, 2019.

While the intent was that this legislation would be passed this year, the fact that the Senate HELP Ranking Minority Member Patty Murray (D-WA) did not endorse the E&C-HELP proposal, in addition to the fact that the Ways and Means proposal came with a call for delay in legislative action on the issue until next year, makes speedy passage of legislation less likely. It is notable that neither the E&C-HELP nor the Ways and Means proposals were accompanied by legislative text outlining specific details.

The Ways and Means proposal similarly holds patients harmless for cost-share at the in-network level in surprise billing scenarios. The significant difference is in its proposed reconciliation process for disagreements between insurers and providers. The agreement first calls for the parties to come to private agreement without interference. If private negotiations fail, the proposal provides for “a robust, impartial, and structured process to settle payment.” Only a vague outline of this process is provided, stating that the process includes, “[s]trong conflict-of-interest protections,” “[t]imely decisions,” and “[c]lear criteria.” The only guidance as to a standard to be provided states that the “[e]vidence considered must include payments made to similar providers for similar services in similar areas.” The proposal also calls for a disincentive for “frivolous use” in the form of a “reconciliation process fee” imposed on the losing party, and a “surcharge” imposed on parties that use the process excessively. The proposal would not supersede surprise billing protections under State law.

The text of H.R. 3630, introduced on July 9, 2019, can be found here. A summary of the E&C-HELP compromise plan can be found here. The Ways and Means Committee’s proposal can be found online here.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© King & Spalding | Attorney Advertising

Written by:

King & Spalding
Contact
more
less

King & Spalding on:

Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
- hide
- hide

This website uses cookies to improve user experience, track anonymous site usage, store authorization tokens and permit sharing on social media networks. By continuing to browse this website you accept the use of cookies. Click here to read more about how we use cookies.