Maybe in 2023, the federal government will employ a fair way to settle billing disputes between hospitals and insurance companies.
But with the Texas Medical Association (TMA) filing its third lawsuit this December, it’s not looking good.
If you need a refresher, the No Surprises Act seeks to protect patients from being balance billed when their doctors go out-of-network for care. In other words, the bill removes patients from being financially caught in the middle of payor-provider contract disputes.
Instead, the No Surprises Act uses an arbitration process to determine a fair payment for medical services. And therein lies the issue, per a December article in Healthcare Dive.
The way the law is currently written, a fair payment is based around the “median in-network rate” for a specific service in a specific area. And that’s all fine and dandy – except insurers have a lot of say over what those rates are.
To avoid paying a fair amount, insurers are incentivized by the arbitration process to push out any providers in their network, even if their higher rates are in line with their skill, experience, or capability.
At first, the law was written in a way that directed arbiters to only focus on that median rate, despite other relevant factors – like skill and quality. That was the target of the TMA’s first lawsuit.
After successfully contesting the language, the final rule required arbiters to consider the rate as well as other factors, but provider groups have continued to argue that the rule still gives insurers overwhelming power in their negotiations.
It remains to be seen how these lawsuits play out – but here’s hoping regulators are able to find a way to protect patients without giving outsized power to mega-profitable insurance companies.