Provider
charges grew faster than Medicare payment rates in emergency medicine and
anesthesiology, at 6.7 and 4.4 percent annually from 2012 to 2017.
December 10, 2019
- Specialists who can surprise bill – emergency medicine and ancillary
physicians – had significantly higher provider charges compared to Medicare
payment rates versus other specialists, a new analysis from USC-Brookings Schaeffer
Initiative for Health Policy showed.
Average charges have
been growing notably fast relative to Medicare payment rates in emergency
medicine and anesthesiology, at 6.7 and 4.4 percent annually on average from
2012 to 2017, respectively, the analysis found.
“Interestingly,
though, while still at high levels relative to other specialties, radiology and
pathology charges relative to Medicare rates have grown roughly in line with
other specialties since 2012,” researchers wrote in the analysis.
Emergency medicine
and ancillary providers are associated with higher levels of surprise billing
because patients are unable to choose their provider when receiving certain
services most commonly rendered by the providers. For example, patients may
unknowingly receive care from an out-of-network provider furnishing emergency
care or anesthesiology services at an in-network hospital.
In these cases, what
providers charge matters. First, uninsured patients are often liable for the
full charge, although there may be discounts offered, the analysis stated.
Second, when a patient is treated by a provider outside of their insurer’s
network, he or she can be billed at the provider’s charge amount. The insurance
company only covers part of the bill, so the patient is required to take on the
rest of the amount.
The analysis of
federal data on provider charges and billing codes for Medicare providers from
the USC-Brookings Schaeffer Initiative for Health Policy found that growth in
the 80th percentile of provider charges relative to Medicare rates by specialty
was most pronounced for emergency medicine and anesthesiology. These
specialties had 40 percent growth over the five-year study period.
In addition, the
ratio of mean charges to Medicare payment rates for emergency medicine and
anesthesiology varied substantially state to state in 2017, the analysis
stressed. For example, mean anesthesiology charges around the country varied
from four times Medicare rates for the same services in Oklahoma to over 11
times in Wisconsin. And the ratio average emergency medicine physician charges
to Medicare rates varied from 7.5 times Medicare rates in Texas to only 3.1 in
Montana.
Surprise billing has
been a major concern for the healthcare industry recently. Data from a 2018 Kaiser Family Foundation
survey showed that 40 percent of patients had received a surprise medical bill
in the last 12 months, and 67 percent reported that receiving a surprise
medical bill is a serious cost concern.
Separate Health Care
Cost Institute (HCCI) data showed that one in seven patients
received an out-of-network surprise bill even when they believed they were
receiving care in an in-network facility.
Lawmakers have
proposed several bills during the 2019 to 2020 session of Congress in order to
help the ongoing issue of surprise billing.
The challenge with
these bills is that they don’t always successfully tackle surprise billing. An
October study from the USC- Brookings Schaeffer Initiative for Health Policy
showed that New York’s arbitration solution for surprise billing actually
increased what payers and patients pay for out-of-network care, meaning federal
solutions to surprise billing that include arbitration have the potential to
increase patient costs across the country.
Recent research has
pointed to a different solution used by California policymakers. In the Golden
State, patients who receive out-of-network care are billed the in-network rate.
Payers then reimburse at the physician’s average contracted rate (ACR), which
is the local standard at 125 percent of the Medicare reimbursement rate.
A recent AHIP study found that there are 16 percent
more in-network physicians in California since the passing of the state’s
surprise medical bill law. This indicates that the benchmark price setting may
not force physicians out of insurance networks, which is a concern among
federal policymakers debating surprise medical billing solutions.
Payers and providers
are split on which approach is more appropriate. Payers tend to favor benchmark
rates for out-of-network care, while providers are more likely to advocate for
an arbitration process.
Federal policymakers,
however, are leaning toward the latter option. Bipartisan House and Senate
committee leader recently announced that they reached a bipartisan,
bicameral agreement on a method for preventing surprise medical bills, and that
method is a new dispute resolution system that includes arbitration.
“Americans who follow the rules and pay their
premiums shouldn’t get stuck with a $50,000 bill because a hospital contracted
a NICU to an out-of-network provider, or a $109,000 bill after being rushed to
a nearby hospital for a heart attack,” Ranking Member Greg Walden (R-OR) said
in the joint statement. “To put it plainly: Americans are sick and tired of
being ripped off by surprise medical bills, and they want Congress to act. This
announcement brings us one step closer to answering that call for action with
bipartisan legislation to prohibit surprise medical bills and take the patient
out of the middle.”
The policymakers
urged
a quick vote on the legislation. It is unclear if the solution will pass.
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