Media Reports: Federal COVID-19 Relief Bill Contains Revised “Surprise Billing” Provision

As both houses of the United States Congress hurtled towards passing a $900 billion COVID-19 relief bill, media reports are indicating that long-anticipated legislation on surprise medical billing issues has been included in the sweeping legislation. Several reports from national news media on Sunday evening, December 20, reported on that development. The entire package of legislation was expected to receive votes in the House of Representatives and the Senate on Monday, Dec. 21, before the Congress recesses for the year-end holidays.

The Associated Press’s Andrew Taylor wrote on Sunday evening that “The end-of-session rush also promised relief for victims of shockingly steep surprise medical bills, a phenomenon that often occurs when providers drop out of insurance company networks.”

The Hill’s Naomi Jagoda, Niv Elis, and Alexander Bolton reported on Sunday evening that “The legislation includes provisions to end the practice of surprise medical billing. It would hold patients harmless from surprise bills, including from air ambulance providers and prohibit out-of-network providers from “balance billing” unless they give patients 72-hour notice of their network status and an estimate of the charges.

Meanwhile, POLITICO’s Susannah Luthi wrote on Sunday evening that “Congress is set to include a long-elusive ban on “surprise” medical bills as part of a major spending deal lawmakers were working to finalize Sunday evening. A joint statement from House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer confirmed a surprise billing fix is part of the government funding deal, which also includes $900 billion in new Covid-19 relief.”

Luthi wrote that, “ Though key congressional committees had agreed more than a week ago on a plan for protecting insured patients from large medical bills when they unwittingly receive out-of-network care, it had been unclear whether it would be part of must-pass government funding legislation. The final decision came down to Senate Majority Leader Mitch McConnell, who had been silent on the deal. The White House has already endorsed the plan nearly two years after President Donald Trump first called on Congress to fix an issue that has drawn bipartisan concern. But those efforts were nearly derailed by opposition from well-funded groups and congressional turf battles.”

Luthi noted that, “While the health care industry agreed that patients should be held harmless in emergency situations, hospital and physician groups and insurers fought vigorously over who would pick up the tab. The compromise deal congressional committees struck earlier this month was considered largely a win for hospitals and doctors —and tweaks made in the final legislation are even friendlier to providers, according to a summary obtained by POLITICO.” And Luthi wrote, “The previously announced deal called for health insurers and providers to negotiate most billing disputes or bring their complaints to a mediator. But in one key change, the final version of the bill would forbid arbiters from taking into account Medicare and Medicaid rates, which are typically much lower than what commercial coverage pays.”

Writing on Dec. 18 in the Health Affairs Blog, based on the form of the legislation as it existed on that day, Jack Hoadley, Katie Keith, and Kevin Lucia wrote, in an article entitled “Unpacking The No Surprises Act: An Opportunity To Protect Millions,” that “This new bipartisan, bicameral legislation is the culmination of two years of hearings, mark-ups, campaign ads, and negotiation. Congress has gotten close before, but never this close. The No Surprises Act includes several changes from prior compromise bills,” they wrote. “These changes largely center on the mechanism to determine how much out-of-network providers will be paid by insurers. Unlike many prior bills, the No Surprise Act would not establish a benchmark payment standard for insurers to pay out-of-network providers. Instead, insurers and providers would try to resolve payment disputes on their own. If that failed, these stakeholders could turn to arbitration. This change (arbitration with no benchmark payment standard) is more favorable to health care providers like hospitals and physicians than prior bills. But the bill also includes several important guardrails to help ensure that the arbitration process—which critics have argued can be inflationary—is not abused.”

They also noted that “States have recognized this need: in 2020 alone, Georgia, Maine, Michigan, and Virginia passed comprehensive protections on an overwhelmingly bipartisan basis, making a total of 17 states with comprehensive protections to bar surprise medical bills in emergency and nonemergency situations. But state laws can only go so far. Federal legislation is needed to protect the estimated 135 million people with self-funded coverage and to extend these protections to federally regulated providers, such as air ambulances. Beyond the need to protect patients, there are practical considerations as well. Key Republican champions of surprise medical bill protections—Sen. Lamar Alexander (R-TN) and Rep. Greg Walden (R-OR)—are retiring at the end of 2020. And the proposal would result in savings: the $18 billion in savings from the No Surprises Act would be used to fully fund community health centers and other primary care programs for four years.”

Back on Dec. 14, the Chicago- and Washington, D.C.-based American Hospital association had released a statement on the proposed surprise billing legislation. “AHA yesterday commented on the No Surprises Act, bipartisan, bicameral legislation released Friday to address surprise medical bills. ‘We strongly support provisions to protect the patient from surprise medical bills,’ AHA wrote to leaders of the House Ways and Means, Energy and Commerce, and Education and Labor committees and the Senate Health, Education, Labor and Pensions Committee. ‘Once the patient is protected, hospitals and health systems should be permitted to work with health plans to determine appropriate reimbursement, as is provided for in your bill. As you know, we strongly oppose approaches that would impose arbitrary rates on providers, which could have significant consequences far beyond the scope of surprise medical bills and impact access to hospital care, particularly in rural communities. However, we urge you to consider several modifications to the dispute resolution process to reduce burden on all parties and ensure fair consideration of offers. We also would like to commend you for not including in the legislation certain provisions extraneous to the surprise medical billing issue, such as those related to privately negotiated contracts, which would lead to narrower provider networks with fewer choices for patients. However, we have significant concerns with several of the provisions that would attempt to implement unworkable billing processes and transparency provisions that are duplicative and costly without clear added benefit for patients.’” And, the statement concluded, “Finally, we ask that any savings associated with this legislative initiative be directed to those providers that are on the front lines of treating COVID-19 patients, such as hospitals, physicians and nurses.”

The Chicago- and Washington, D.C.-based American Medical Association had a different take on the legislation, however. Based on the legislation as it existed on Dec. 15, the AMA wrote a letter to the four top congressional leaders—Senate Majority Leader Mitch McConnell, Senate Minority Leader Chuck Schumer, Speaker of the House Nancy Pelosi, and House Minority leader Kevin McCarthy—that stated that “The No Surprises Act includes improvements over previous proposals, such as additional factors the Independent Dispute Resolution (IDR) entity may consider in determining the most appropriate payment amount. Nonetheless, we oppose enactment of the bill in its current form because it would significantly disadvantage already stressed physician practices, particularly small physician practices that may not have the resources to take advantage of the IDR process to obtain fair compensation for their services. Furthermore, we remain deeply concerned that significant reductions of in-network rates predicted by the Congressional Budget Office strain the ability of small practices to keep their doors open, especially in light of the significant financial pressures practices have faced in the last ten months. We would welcome, however, the opportunity to continue to work with you to address these issues in a timely manner.”

The letter, sent under the signature of James L. Madara, M.D., the AMA’s executive vice president and CEO, went on to state that “We also have significant concerns with the limited opportunity for stakeholders to thoroughly vet this consequential bill prior to its inclusion in an end-of-the year legislative package and seek meaningful input from our practicing physician members. There remain multiple questions raised by the legislative text that require further clarification before Congress should consider advancing the proposal.”

Meanwhile, a letter from the Englewood, Colo.-based Medical Group Management Association (MGMA) to that same quartet of senior congressional leaders stated that “We appreciate that lawmakers in both chambers are working in a bipartisan manner to develop legislation to address the important issue of unexpected medical costs. We also appreciate that the No Surprises Act includes an independent dispute resolution (IDR) process to determine fair payment rates when patient protections against surprise medical bills apply. A solution that incorporates IDR encourages a balanced and reasonable approach to payment disputes. Further,” MGMA’s letter, sent under the signature of senior vice president-government affairs Anders Gilberg, said, “we thank you for including specific examples of elements independent entities may consider in mediation, such as the level of training, experience, and quality/outcome measurements of the provider; the acuity of the individual; complexity of furnishing services; and good faith efforts to contract with the payer. However, we are concerned that stakeholders have had limited opportunity to thoroughly review and provide meaningful input on this consequential bill prior to inclusion in any end-of-the year legislative package. We urge you to allow additional time for MGMA and other stakeholders to work with Congress to address concerns with certain aspects of the legislative language.”

The final text of the legislation as passed by Congress, if passed on Monday, should be available on that day. Healthcare Innovation will update readers on this developing story.