House committee chairman floats compromise to tackle surprise medical bills

The head of the powerful House Ways and Means Committee is floating a compromise to restart momentum to tackle surprise medical bills.

Rep. Richard Neal, D-Massachusetts, wrote a letter to his Democratic colleagues Sept. 27 detailing a compromise to address provider demands for an arbitration process instead of a benchmark out-of-network rate.

The letter, first reported by Politico and posted online by The Hill, would instead create a “negotiated rulemaking” process to work out differences on out-of-network rates.

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The negotiated rule-making process would require three agencies—the departments of Health and Human Services, Labor and the Treasury—to form a committee to identify standards for rates for surprise bills, according to the letter.

It would be up to the committee whether to add a dispute resolution and to define the parameters of that resolution process. The result would go through a public comment period.

Neal said that legislative staff will be working on this compromise over the current two-week recess period.

Both the House Energy and Commerce Committee and the Senate Health, Education, Labor and Pensions (HELP) Committee have advanced bills to ban surprise medical bills. However, the HELP bill would set a benchmark rate for any out-of-network charges. Energy and Commerce’s legislation would also use a benchmark but would have an arbitration backstop if an agreement on a benchmark rate can’t be used.

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Providers have been clamoring for a “baseball-style” arbitration process to be used in which both the payer and provider submit an offer for an out-of-network charge and an independent arbiter picks one. Providers have charged that having the government set a rate would stifle their ability to negotiate for lower rates. 

The insurance industry has been pushing instead for a benchmark rate, calling arbitration a costly process that could drive up premiums. The two sides have clashed over the summer on how to handle provider charges.

Momentum on addressing surprise bills has stalled in Congress since lawmakers returned from their August recess. So far, neither the Energy and Commerce nor the HELP committee’s legislation has hit their respective floor.