A study published Sept. 11 in the American Journal of
Managed Care found that a federal law to rein in surprise medical billing could
reduce overall health insurance premiums by 1% to 5%.
The study, which was prepared by researchers at the
USC-Brookings Schaeffer Initiative for Health Policy, is based on 2017 data
compiled by the Health Care Cost Institute, which is drawn from claims
submitted to UnitedHealthcare, Humana Inc. and CVS Health Corp.'s Aetna.
The cost reduction finding is based on a model that assumes new
legislation would reduce procedures that are currently surprise billed either
by 15% altogether, or reduce their costs to 150% of traditional Medicare rates.
In the former scenario, legislation would save commercially insured members
about $12 billion, and in the latter, those members would save roughly $38
billion.
Loren Adler, a fellow at the USC-Brookings Schaeffer Initiative
for Health Policy and an author of the study, says surprise bills have an
underappreciated impact on overall health plan spending.
"Fundamentally, surprise billing is obviously awful for the
people who receive the surprise bills themselves. But this study shows that
we’re talking about a pretty substantial effect on premiums," he adds.
"To me, what really matters is, how much money would you
save per member per year if you could get the average payment [of surprise
bills] down to what the average payment is for in-network physicians? [The
study's] number is $212 per member per year," says Joseph Antos, a
resident scholar at the American Enterprise Institute.
Antos points out that providers who surprise bill are acting
rationally in an unfair set of economic conditions that is enabled by a failure
of government.
That gap in the rules has not gone unnoticed by public officials,
but Washington, D.C. insiders say that surprise billing legislation isn't
likely to advance any time soon. Many were hopeful that surprise billing
legislation would pass Congress by now, but progress has stalled.
"It feels very unlikely that anything constructive is going
to be done in health care legislatively at this point, just given everything
else that is going on and given that we’re so close to the election. I think
that we're looking into a window of lame duck or into the next session," says
Avalere founder Dan Mendelson.
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