With more patients being stuck with surprise medical bills for out-of-network providers, one health policy expert says Congress needs to do more to halt the practice entirely.
“I think this is an outrage,” Ashish Jha, M.D., director of the Harvard Global Health Institute, told lawmakers during a Senate Health Education Labor & Pensions (HELP) Committee hearing this week. “It’s unethical, if not illegal. Obviously it’s not illegal, but it ought to be.”
Jha, who also serves as the senior associate dean at the Harvard T.H. Chan School Of Public Health, said the best estimates indicate that 1 out of 7 times someone goes to the emergency department, they are going to be stuck with a surprise bill.
“Even if that’s double the true number, these are just astronomically high numbers,” he said.
A recent survey conducted by the Rutgers Center for State Health Policy found that 1 in 7 New Jersey residents—or 400,000 families—received a large medical bill they didn’t expect in the last year. A 2011 study (PDF) conducted by the New York Department of Financial Services found patients paid $3,778 on average for surprise emergency bills and sometimes more than $12,000 for out-of-network surgeons.
Surprise billing—also known as balance billing—occurs when an out-of-network provider, often working at an in-network hospital, bills the patient the amount left uncovered by their insurer.
Examples raised by lawmakers and other policy experts on the panel were, indeed, outrageous. Sen. Patty Murray, D-Wash., relayed a story in which a Washington resident undergoing treatment for breast cancer was stuck with a nearly $800 bill.
“Her hospital was in the network, her surgeon was in the network, but the anesthesiologist wasn’t, so her insurance stuck her with most of the bill,” Murray said. “And her story’s not unique.”
David Hyman, M.D., a professor at Georgetown University School of Law relayed a story of a patient who gave birth in a hospital and later found out the neonatal intensive care unit was out-of-network, “which is just crazy.”
Hyman likened it to going to a body shop to have your car repaired and getting a separate bill from the painter.
“You would never go to the body shop, you would write a mean review on Yelp and no one would ever go there again,” he said. “And the employer would fire the painter and reorganize their operations.”
Jha placed the blame squarely on ED staffing companies, which turn a profit by outsourcing services to hospitals in need of emergency physicians who remain out of network. Envision Healthcare, which owns the emergency physician staffing company EmCare, has been criticized for surprise medical bills and inflated billing practices.
In April, UnitedHealthcare cut ties with Envision, citing “highly questionable” billing.
Even patients who do their homework ahead of a planned surgery to determine which providers are out of network are often stuck with surprise bills, Jha said. Six states have “done something useful,” he added, but self-insured employer plans can skirt state mandates.
“I think the federal government also has a role here in putting in policies that say, we won’t allow for this surprise billing and it should go to the patient and that there has to be a mechanism by which that gets resolved between the insurer and the provider,” he said.