Congressional Committee Investigates Private Equity Firms Over Surprise Medical Bills
Image courtesy of The Hill
Congress has been looking for a culprit behind the current controversy over surprise medical billing. For the time being, radiologists are off the hook.
Energy and Commerce Chair Frank Pallone (D-N.J.) and ranking member Greg Walden (R-Ore.) have targeted private equity firms invested in emergency transportation and doctor staffing companies. The committee’s focus on investors in these companies is not surprising, since surprise bills are most commonly linked to services provided by an out-of-network emergency physician or supporting clinician, such as an anesthesiologist, consulting surgeon, pathologist, or radiologist, contracted to a health provider otherwise in-network for the patient.
President Donald Trump has said that the practice of surprise medical billing “must end.” And before the August recess, it appeared that both parties in Congress were poised to vote in favor of legislation that would have limited patient responsibility for anything over coinsurance and deductibles their insurance requires. But after Doctors Patient Unity spent $13 million on television advertising in states with vulnerable senators opposing the new law, Congress seems inclined to consider revisions to the bill.
Twenty-five states already have laws on surprise medical billing. Most of these laws do not allow doctors or hospitals not under contract with an insurer to charge patients more than what a patient’s insurer would normally pay for service. These laws do not prevent doctors and hospitals from trying to bill for more. They do not apply, however, to patients whose employers self-insure, that is, the employer takes responsibility for the financial risk of providing health benefits to its employees. Even in states that have surprise medical billing statutes, about 65 percent of insured patients are not shielded from surprise medical billing.
Every member of the House of Representatives has at least one hospital in their district that would be affected by the law. The nation’s hospitals are understandably concerned that setting benchmark rates for out-of-network costs would have unintended consequences, such as providing a disincentive for insurance companies to keep hospitals in-network.
Health insurance companies are on the other side of the debate. They have lobbied Congress to establish standard out-of-network charges equal to the mdeian in-network rate for the same service under the patient’s health insurance policy.
What is at stake for reimbursement of charges by radiologists?
Radiologists charge relatively more for their services than physicians in other specialties, but they are far from the top of the list.
A study of CMS data submitted in 2014 by 429,273 providers across 54 medical specialties and published in JAMA found that doctors charged from 1.0 to 101.0 times Medicare rates for their services. Among the specialists, anesthesiologists had the highest charge over Medicare base rates, 5.4 times the Medicare amount. Of 10,730 providers identified as billing “high excess charges,” 55 percent were anesthesiologists. Diagnostic radiologists charged, on average, 3.8 times the Medicare amount. Interventional radiologists charged, on average, 4.5 times the Medicare amount.
Charges also differed by geography. The highest billing rates were found in just 10 of the nation’s 306 referral regions:
- Newark, New Jersey;
- Charlotte, North Carolina;
- Camden, New Jersey;
- Los Angeles;
- East Long Island, New York; and
Differences in regional billing rates could reflect differences in regional practice norms. But the data seem to indicate that radiologists are more vulnerable than most other specialists to patient complaints about billing. So how should radiologists talk about billing with their patients?
There are entire continuing education courses devoted to this topic, but here are three essentials:
- Transparent prices are more readily accepted than surprise prices. The earlier in the process of diagnosis, possible admission, and treatment the patient is informed of additional prices, the more likely the prices are to be accepted.
- Service trumps accuracy in patient acceptance of prices. Any degree of accessibility takes away the sting of paying the unseen doctor. However, this does not mean that radiologists have to start doing primary care. Clear communication of findings and their limitations in the initial report, avoiding any need for addenda to reports, enhances price acceptance.
- Some markets, such as those identified above, tend to be populated by price-sensitive patients. It’s not fair to radiologists that they have to deal with their patients’ surprise billing fatigue. But it’s a fact of medical practice.
American medicine may escape the unintended consequences of surprise billing legislation, but it is not a topic that is going away. Strategic and empathetic engagement with patients over price is the best prophylaxis for upset over surprise medical billing.