By Dr. Derek Marsee
Unexpected medical bills are an unwelcome development for anyone. The problem, known as “surprise billing,” has become more pervasive in recent years, and Congress has decided to step in and address it. As a doctor, I applaud lawmakers for their willingness to tackle this issue and hope they will use solutions already implemented at the state level to guide their policy prescriptions. When they examine the system adopted by California just a few years ago, they should not see a guidepost — but a red flag.
Surprise billing occurs when an out-of-network healthcare provider treats a patient, and the patient’s insurance company refuses to cover the cost. A majority of these situations can be attributed to emergency room visits, where patients do not have the time or ability to search for an in-network hospital. They can also result from surgeries that are scheduled at an in-network hospital or surgery center, where an out-of-network provider is used for diagnostics or anesthesia. In short, surprise medical bills are out of the patient’s control and the root cause of these bills lies with insurers who refuse to pay for care.
California attempted to tackle this issue in 2016 when lawmakers passed Assembly Bill 72. Unfortunately, there have been some unintended consequences. The bill has failed to take patients out of the middle of negotiations and given insurers unfair leverage to cap out-of-network rates with certain providers. In the case of pathologists like me, one insurer recently slashed reimbursement rates by 50% for some essential diagnostic and biopsy procedures.
In cases such as these, insurers in California now offer “take it or leave it” negotiations with doctors, who can elect to join an insurance network at an unreasonably low rate, or go out of network, where they will also be reimbursed at an unreasonably low rate. This will only force more pathologists to cancel their existing contracts and compound the issue of access to quality care.
Congress appears poised to learn the wrong lesson from California. Lawmakers in Washington are moving forward with federal legislation that artificially caps rates, just like the California law. A bill cleared by the Senate Health, Education, Labor and Pensions Committee would benchmark reimbursements to a median in-network rate. Like the California law, this bill fails at its most important mission: protecting patients and removing them from the middle of disputes between insurance companies and doctors.
However, there is another bill under consideration that would actually solve surprise billing, protect patients, avoid further doctor shortages, and slow the growth of healthcare costs. We know this because it has already worked in other states, including New York. This approach relies on an Independent Dispute Resolution process, which brings doctors and insurers to the table to negotiate with one another over out-of-network fees instead of dragging the patient into the middle. New York has resolved nearly 2,000 disputes with this system since it was adopted two years ago — with the patient being spared a surprise medical bill in each case.
As doctors, it is our duty to put the patient first. Congress should do the same. We should build upon our experience in California and improve our model in favor of another solution that can help avoid the doctor shortages and loss of access that comes along with it.
Derek Marsee as a Sacramento-based pathologists who is president of the California Society of Pathologists.
>> Subscribe to Times of San Diego’s free daily email newsletter! Click hereFollow Us: