The Season For Surprise Billing Is Here – Unless Congress Acts

By Joseph Loughon

As summer comes to a close, the time for swimming, hiking, and biking is almost over – which ideally means a decrease in emergency room visits. Unfortunately, if you were one of the people who had to make a trip to the Zuckerberg General Hospital and Trauma Center over the last few months, you may have something else to look forward to this fall.

The hospital, San Francisco’s only trauma center, came under fire recently after it was found that it did not contract with private insurance companies, meaning that if you were not a part of Medi-Cal, you may be stuck with a large out-of-pocket medical bill. 

The California state assembly worked to counter this price gouging by insurance companies and hospitals through several measures, most notably a bill allowing patients with private insurance to pay in-network rates when they use an out-of-network medical provider. But this only applies to non-emergency treatment, such as surgery or x-rays, and does not cover an impromptu ambulance ride or treatment at hospitals such as Mr. Zuckerberg’s.

Enter California Assemblymember, David Chiu. He sought to close this loophole with a new bill this past legislative session aimed at addressing surprise medical billing in emergency services. Under Chiu’s bill, should a patient with private insurance use an ambulance, or visit an out of network emergency room, the patient’s insurance and medical providers would be required to work directly with the state to decide a fair medical bill. Regardless of that decision, the patient would only pay the in-network copayment.

As expected, insurance providers and hospitals vehemently opposed the closure of this cash cow loophole and utilized their powerful lobbyists to pull the bill from the floor. While the passage of this good-faith legislation has been sidelined in California this year, there is still hope, and surprisingly, it comes from Congress.

Senator Bill Cassidy (R-LA) and Senator Tom Carper (D-DE), among others, recently introduced legislation aimed at addressing the exact same issue, albeit on a national scale. Under the STOP Medical Bills Act, similar to Chiu’s legislation, a patient would only be required to pay the in-network co-pay for emergency services, regardless of whether or not the patient was treated at an out-of-network hospital or medical provider. The same provision would apply to follow-up care after an emergency, as well as non-emergency hospital visits. The provider and insurer could then work through an independent arbitration system, similar to how players in the Majors negotiate their contracts. That’s why some in Congress call it ‘baseball-style’ arbitration. 

Through this method, insurance providers would automatically be paid the difference between the patient’s in-network co-pay and the median in-network rate for their services. However, medical and insurance providers would be given the opportunity to appeal this payment through a third-party arbitrator. This is where the ‘baseball-style’ arbitrator comes into play (pun intended). The arbitrator would be certified by the Secretaries of Health and Human Services and the Department of Labor to make a final decision based on the industry average rates for the patient’s region. 

The STOP Surprise Medical Bills Act is beginning to gain bipartisan momentum in the Senate as well. Under Senator Bill Cassidy’s (R-LA) leadership, the bill has gained 26 co-sponsors in just under 3 months, an impressive feat. 

Given the current popularity of healthcare reform on both sides, and the unexpected financial burden this issue causes for average Americans, members of Congress would be wise to unify on this issue. Should the Stop Surprise Medical Bills Act make it out of the Senate and onto the House floor, California Republican leaders such as Representative’s Kevin McCarthy and Devin Nunes may want to take notes from their home state and help push this legislation over the finish line. 

Joseph Laughon is a conservative political commentator and former journalist.