Compromise bipartisan legislation to address surprise medical bills is getting push back from physician groups.

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Leadership from the House Energy and Commerce Committee and the Senate Health, Education, Labor, and Pensions Committee on Dec. 9 unveiled a compromise bill that includes rate-setting for small surprise billing and arbitration for larger ones at a lower threshold than what was originally proposed.

The new bill, part of a broader Lower Health Care Costs Act, would protect patients from surprise medical bills related to emergency care, holding them responsible for in-network cost-sharing rates for out-of-network care provided at an in-network facility without their informed consent. Out-of-network surprise bills would be applied to the patient’s in-network deductible.

Under the legislation, providers would be paid at minimum the local, market-based median in-network negotiated rate for services, with a median rate under a $750 threshold. When the median exceeds $750, the provider or insurer would be allowed to choose arbitration process to resolve payment disputes.

The bill also protects patients by banning out-of-network facilities and providers from sending balance bills for more than in-network cost-sharing amounts.

Physician groups, however, see the legislation as a giveback to insurers that puts health care professionals at a disadvantage when negotiating to be included in insurer networks.

At issue is the $750 threshold for optional arbitration.

“If you set the arbitration system in such a way that limits the ability of a physician to go to arbitration to settle a dispute between a health plan and the doctor, and if you say that can only be done when there [are] bills that are greater than $750 for a particular service, then the vast majority of services provided by doctors will not be able to go to arbitration,” Christian Shalgian, director of advocacy and health policy at the American College of Surgeons, said in an interview.

Cynthia Moran, executive vice president of government relations and health policy at the American College of Radiology, agreed.

“This particular product is going in a direction that we’re not comfortable with so we can’t support it on the basis of the benchmarks and the independent dispute resolution (IDR) process with the $750 threshold,” she said in an interview. The services radiologists provide tend to be in the $100-200 range, she said, so that would automatically exclude them from accessing arbitration. She also said that it is her understanding that many physician services will fall under that $750 threshold.

“That $750 is really going to mean that the vast majority of this policy is a benchmark-driven policy,” she said. “It is not going to be an IDR-driven policy and that is the crux of our objection to it.”

And by taking arbitration off the table, insurers have no incentive to negotiate in good faith with doctors to ensure that doctors are getting paid for the services they perform.

“For those situations where there is an out-of-network physician at an in-network facility, we believe that the patient should not have to pay any more for those emergency situations where they patient doesn’t get to choose their doctor,” Mr. Shalgian said. “The dispute really comes down to how much does the health plan have to pay the doctor.”

He noted that the legislation ties the rate to median in-network rates “and that’s a problem for us as well because of the fact that [this is] going to allow the health plans to set median in-network rates as the rate that they can pay the doctors.”

If the bill becomes law, “when you have a situation where you have an in-network physician trying to negotiate with a health plan to stay in network, that health plan now has more power in that negotiation because if [the physician] is making more than median in-network rates, then the health plan can say, ‘go out of network because we will just pay you median in-network’ at that point. That is a significant concern to us as well.”

Mr. Shalgian said that the ideal solution would be to eliminate the threshold entirely and just send disputes to arbitration. Recognizing that it might not be practical, the $750 threshold should be lowered.

ACS supported a $300 threshold, he added.

The bill is expected to be tacked on to one of the mandatory spending bills that Congress needs to pass by the end of the year.

The $750 threshold would be a savings generator for the government and an important bill such as this should be passed on its own merits, Mr. Shalgian said.

Ms. Moran called for Congress to take its time with the legislation.

“We do think that this whole issue needs more time for everyone to understand what the impact is on this first run of the solution and we think it should be slowed down a bit,” she said. “It should not go to the floor until you hear more from the providers [after] the providers figure out what the impact will be.”

The American Medical Association also called for Congress to slow down.

“The current proposal relies on benchmark rate setting that would serve only to benefit the bottom line of insurance companies at the expense of patients seeking a robust network of physicians for their care,” AMA President Patrice Harris, MD, said in a statement. “Rather than rushing to meet arbitrary deadlines, it is important to get this legislation right.”

gtwachtman@mdedge.com

Docs push back on surprise billing compromise