'Surprise Medical Bill' Witnesses Clash Over Binding Arbitration

Health care providers seem to like the idea of using arbitration to resolve disputes over billing for out-of-network claims.

Employers, health insurers and patient advocates seem to hate the idea.

That conflict surfaced Wednesday, in Washington, at a House Energy  and Commerce health subcommittee hearing on ”surprise medical bills.”

(Related: Senators Borrow From Baseball to Address Balance Billing Problem)

Policymakers are using the term “surprise medical bills” to refer to unexpected cases of balance billing, such as situations in which patients verify that they are getting care in-network but end up receiving bills from out-of-network providers anyway.

Sonji Wilkes, a patient advocate, talked about going to the hospital to have a baby. The hospital and her physician were in-network providers. But her baby turned out to have hemophilia. The hospital had brought in an outside company to run its neonatal intensive care unit. The company that ran the NICU was outside of Wilkes’ health plan’s networks. Wilkes’ baby ended up receiving out-of-network care without her realizing it, and the NICU care provider sent her a $50,000 bill.

The House Energy health subcommittee convened the hearing partly to talk about a discussion draft version of the “No Surprises Act” bill. Bill drafters hope to prevent the kinds of billing problems that Wilkes faced.

James Gelfand, senior vice president for health policy at the ERISA Industry Committee (ERIC) — a group for large employers — said his organization would like to see the following rules adopted:

1. An in-network matching rate guarantee: This provision would require every provider who treats a patient at a facility in the patient’s network to bill the patient at the patient’s in-network rate.

2. An emergency care cost benchmark: ERIC says the government could set a benchmark rate schedule, such as a schedule based on Medicare reimbursement rates, for out-of-network emergency care. If a health plan and a provider could not come to an agreement on the price of a service on their own, they could use the benchmark price as the price.

3. An informed consent requirement: This rule would require in-network providers to let patients know if the in-network providers were passing patients over to out-of-network providers.

Gelfand said ERIC opposes the idea of using arbitration to resolve disputes over surprise bills.

“These ‘solutions’ do not end surprise billing ,” Gelfand said, according to a written version of his remarks. “They merely change who is subject to paying the surprise bill. As such, binding arbitration enshrines the current strategy of certain medical providers to eschew networks and generate surprise bills.”

ERIC often ends up agreeing with America’s Health Insurance Plans on health policy issues and disagreeing with Families USA, a consumer and patient advocacy group.