Surprise medical bills stink; Congress can learn from Washington state solution, Tacoma doctor says

It is long past time for Congress to pass legislation that ends the unfair, burdensome practice of surprise medical billing. No one should have to worry about getting slammed with excessive bills because they received out-of-network care, especially in emergency and unplanned situations.

Members of Congress, especially Washington Sen. Patty Murray, should look to the state law that our legislators passed overwhelmingly this past summer, the Balance Billing Protection Act.

While our law was a significant step in addressing this problem, it does not cover everyone; that’s why we need Congress to act. Fortunately, several proposals have been put forward so far; unfortunately, not all are created equal.

One short-sighted “solution” known as benchmarking could actually make things much worse. It would put the government in control of setting payments to physicians by using insurance companies’ in-network averages as the “benchmark” for out-of-network services.

However, since these rates have been deeply discounted during the contract negotiation process, benchmarking would cause local hospitals and emergency rooms to incur significant losses that could translate to diminished access, fewer choices and higher costs for patients.

None of these outcomes are acceptable.

Congress should instead focus on passing a balanced solution that is fair to both providers and insurers while holding patients responsible for only their standard, in-network cost-sharing amounts.

Just such a solution can be found in another proposal called Independent Dispute Resolution, or IDR.

An integral part of our Washington state law is an IDR system that establishes appropriate reimbursement for out-of-network care when physicians and insurance carriers cannot agree on what constitutes “commercially reasonable rates.”

It passed the Legislature overwhelmingly because it was a compromise among physicians, hospitals and insurance carriers.

For our state law to be truly effective, it requires broad participation among health plans, specifically self-insured health plans that have the option to opt in to compliance with the law.

If federal legislation is adopted that does not include an arbitration/IDR component, the likelihood that self-insured plans would opt to comply with the state law is slim to none because the plans would be subjecting themselves to arbitration.

So even though the state law would not technically be superseded, its efficacy would be compromised if federal legislation without an arbitration/IDR provision is adopted.

Conversely, if federal law is adopted with such a provision, it would establish a level playing field for all parties – something that can’t be done at the state level due to federal preemption of self-insured plans.

Additionally, initial payments made at the onset of the IDR process would help keep rural healthcare facilities financially strong and secure, ensuring no one’s access to quality, affordable care is at risk.

Unlike benchmarking, the IDR approach also provides extra incentives for insurance companies to grow their provider networks, helping prevent the kinds of gaps in insurance that lead to surprise medical billing in the first place.

Senator Murray should follow the lead set by healthcare stakeholders and legislators here in Washington. She should replace the fundamentally flawed benchmarking proposal in her legislation, the Lower Health Care Costs Act, with the vastly superior IDR framework.

When all is said and done, that is the only real solution that will work for patients, providers and insurers.

This story was originally published December 12, 2019 at 3:46 PM with the headline "Surprise medical bills stink; Congress can learn from Washington state solution, Tacoma doctor says."