January 31, 2019

White House Signals Growing Interest in Surprise Insurance Gaps

Concerns about “surprise gaps in insurance coverage” and the expensive medical bills they generate for health care consumers are gaining traction in the executive branch and Congress.

On January 23, the White House held a roundtable on Health Care Costs to discuss the issue. President Donald Trump and members of his administration, including Secretary Alex Azar, Department of Health and Human Services; Secretary Alex Acosta, Department of Labor; and Associate Director of Health Programs Joseph Grogan, Office of Management and Budget, met with individuals impacted by the unexpected costs of health care to discuss how make health care prices more transparent for patients.

During the roundtable, stakeholders expressed the need to protect patients from surprise medical bills, touched upon drug pricing and dedicated considerable discussion time to health care price transparency.

The president and Azar underscored the importance of price transparency in medical services as well as prescription drugs. Azar emphasized, “Ultimately, patients should know a service’s price and the price that they’re going to really pay — the out-of-pocket — before they agree to that service. Delivering that is a complex challenge, and we put out multiple requests for information on how to make that a reality.”

With the Trump administration making price transparency a ‘high priority’ and Congressional interest in health care reform again growing, we can expect more attention centered on out-of-network billing, network adequacy, deductibles, prescription drug costs and rising premiums.

A bipartisan group of senators released draft legislation last fall to address out-of-network billing, and the American College of Radiology (ACR) expressed concerns with several aspects of the draft legislation, including the use of the phrase “surprise medical bills,” the lack of robust network adequacy standards, and the federal ban on balance billing and caps on reimbursement for physicians providing care to patients that are deemed out-of-network by an insurer.

Earlier this week, the College joined American Medical Association’s (AMA’s)’s sign-on letter to be sent to chairs and ranking members of key Congressional committees on the topic of surprise billing. The principles contained in this letter were developed in recent weeks by the AMA in collaboration with specialty societies representing hospital-based physicians and other specialties that are frequently called upon to provide on-call emergency services. Other stakeholder groups have already weighed in publicly on this issue, and AMA’s letter attempts to address the legitimate concerns of patients without eliminating the need for insurers to act in good faith when negotiating network participation contracts.

The College views surprise bills as an issue that largely stems from private insurers that reduce the size of their preferred provider networks beyond the point of meeting minimal network adequacy standards in many states. The ACR has urged the Bipartisan Senate Working Group on Health Care Price Transparency to define this issue as “surprise gaps in insurance coverage.” We would argue that it may be more accurate to associate “surprise medical bills” with insurers that are capitalizing upon consumers’ desire for low-cost insurance while failing to disclose costly flaws in their plans, including the potential impact of inadequate provider networks.

Too often, patients only look at the associated price of coverage and discover — usually after they have either been diagnosed with a serious ailment or suffered major trauma — that the specialty physicians needed to render medically necessary care are not contracted with the plan. The ACR remains concerned that the draft federal legislation is far too deferential to the views of the insurance industry. It thus far fails to recognize that business decisions rendered by purchasers and private payers are the root cause for surprise gaps in insurance coverage.

The College will continue to meet with members of Congress in the coming months to offer meaningful ways to improve any draft legislation, and we will continue to work with the Bipartisan Senate Working Group to enhance its draft to properly balance the needs of patients, insurers and physicians.