Bipartisan Surprise Billing Legislation Gets Conditional Support from AHA

House and Senate leaders announced that an agreement had been reached on the "No Surprises Act," which establishes a mediation framework for providers and payers to resolve payment disputes.

The American Hospital Association is offering qualified support for bipartisan, bicameral legislation in Congress that would protect patients from surprise medical bills.

House and Senate committee leaders announced that an agreement had been reached on the "No Surprises Act," which also establishes a mediation framework for providers and payers to resolve payment disputes.

"Under this agreement, the days of patients receiving devastating surprise out-of-network medical bills will be over," House and Senate leaders said in a joint media release.

"Patients should not be penalized with these outrageous bills simply because they were rushed to an out-of-network hospital or unknowingly treated by an out-of-network provider at an in-network facility. This is a win for patients and their families that will improve America's health care system," they said.

The deal was agreed to on Friday by House Ways and Means Committee Chairman Richard E. Neal (D-MA) and Ranking Member Kevin Brady (R-TX), House Energy and Commerce Committee Chairman Frank Pallone, Jr. (D-NJ) and Ranking Member Greg Walden (R-OR), House Education and Labor Committee Chairman Robert C. Scott (D-VA) and Ranking Member Virginia Foxx (R-NC), and Senate Health, Education, Labor, and Pensions Committee Chairman Lamar Alexander (R-TN) and Ranking Member Patty Murray (D-WA). 

Rick Pollack, president and CEO of the American Hospital Association, said in a letter Sunday to lawmakers that the nation's hospitals "strongly support provisions to protect the patient from surprise medical bills."

"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," Pollack said.

Among the concerns raised by the AHA:

• Independent Dispute Resolution Process. If payers and providers use the IDR process, each would submit an offer to the independent arbiter. When choosing between the two offers the arbiter would consider factors such as the median in-network rate, information related to the training and experience of the provider.
  
  Pollack said hospitals are "concerned that the IDR process may be skewed if the arbiter is able to consider public payer reimbursement rates, which are well known to be below the cost of providing care."
  
  "We urge that the legislation include an explicit prohibition on considering Medicare, Medicaid, and other public payer rates, especially as these programs are not implicated by the surprise medical billing provisions," he said.
  
  Pollack also asked that payers' initial payments for out-of-network bills be considered their offer for IDR, which he said would "incentivize them to pay a fair initial reimbursement."
   
• Clarity on enforcement of surprise medical billing violations. "We are unclear as to the oversight of this provision and, in particular, the role of states in overseeing providers," Pollack said. "It appears optional for states to conduct oversight of provider compliance, and the federal government would act as an enforcement backstop in the event a state did not take up this responsibility."
  
  "It also is unclear if states are limited to the civil monetary penalty limits outlined in the draft legislation. This approach could potentially result in uneven enforcement of the bill's protections," he said.
   
• Government auditing of health plan compliance. Pollack said the bill limits audits to 25 plans of all types unless there is a complaint. "This seems to be small number of maximum audits," he said. He also raised concerns that the auditing process "is sufficient to ensure ERISA plans would be audited in the same manner as other health plans."
   
• Notice and Consent for Out-of-Network Services. Pollack asked for clarity on how the bill deals with out-of-network providers. "It appears to put the onus on the out-of-network provider to give the notice and obtain consent, but then suggests that, in the case of out-of-network providers in facilities, it is the facility's responsibility to maintain the consent forms," Pollack said. "Therefore, it is unclear as to the role of the facility versus the individual clinician in providing notice and consent. It also is unclear how the out-of-network provider will know what the in-network provider options would be for a patient, as well as whether the patient's health plan applies prior authorization or other care management requirements on items or services."
   
• Consolidation of Professional and Facility Claims. The bill holds hospitals responsible for physician claims, even if the physician is not employed at the hospital. Pollack said hospitals would not be privy to the proprietary billing rates of providers and payers.
  
  He also complained that the bill would require hospitals to build a framework to solicit bills from providers and issue payments.
  
  "This would result in an unprecedented change in the relationship between independent hospitals and physicians and would require significant technology and legal resources, as well as a revamping of the billing workflow, to operationalize," Pollack said.
  
  "This would add considerable burden and cost to the health care system and has the potential to result in a number of downstream consequences, including reducing patient access to certain specialties within a hospital or health system. And yet, this provision is not essential to resolving the issue of surprise medical bills," he said.
  
  "We strongly urge you to clarify that independent providers, including those working in facilities, are responsible for their own contracting with and billing on health plans."
   
• Timeline for bills. Pollack urged lawmakers to remove timeline provisions after raising concerns that providers will not control how quickly payers respond to bills. He said the bill gives payers "a mechanism to stop their clock by claiming there is a dispute between them and the provider."
  
  "It also is unclear in the legislative text as to whether the penalties occur if any 30-day window within the 90-day timeline is breached or only if the entire 90-day window is breached," he said. "Delayed responses from plans could subject providers to penalties and prevent them from billing patients if they cannot provide patients their cost-sharing information within the required 90-day window."