These 3 Things Will Solve Surprise Bills Better Than Any New Legislation

There’s been a whole lot of talk — and a little bit of action – concerning surprise bills recently. Vox and Kaiser Health News, the latter in partnership with NPR, initiated these conversations by shining a light on so-called “balance billing” with their respective hospital ER bills and bill of the month series. When President Trump called for action to address the issue, he cited individuals whose eye-opening stories were initially told through these outlets.

Shortly thereafter, both the House and the Senate released proposals; the House’s “No Surprises Act” requiring that patients be told beforehand whether a provider is in- or out-of-network and prohibiting emergency departments (EDs) from issuing balance bills to patients, and the Senate’s instituting a third-party arbitration process to negotiate costs.

The problem with these bills is that they are too narrow. We need systemic change, not point solutions. That means: empowering patients, whenever possible, to make high-quality, low-cost decisions; and changing our business model to one that supports a healthcare system in which no bills come as a surprise.

But before we can come to understand these solutions, we must first understand the many ways in which patients—1 in 7, according to the Health Care Cost Institute—may face a surprise bill. Frequently, balance bills occur when patients go to a hospital, even an in-network one, and are provided care by an out-of-network medical professional, most often an anesthesiologist. Despite their best efforts to research and select an in-network hospital and surgeon from which they want to receive care, patients can still receive a surprise bill from another member of the surgical team who, unbeknownst to them, is out of network.

Fortunately, approximately 25 states, according to Pew Charitable Trusts, realize this and have either partial or comprehensive laws protecting patients. Some insurance policies do too, though hospitals under financial pressure may still send carriers the out-of-network bill, the carrier may still pass it along to the patient, and the patient will have to submit an appeal for that policy to come into play, as inefficient as that is. There’s another protection out there too, one that’s been around since 1946. Through the Hill-Burton Act, more than 140 facilities are required to completely pay for, or at least reduce the cost of, healthcare services that qualifying patients cannot afford.

Clearly, our issue with surprise bills isn’t the result of a lack of rules and laws. It’s the result of fundamental flaws within our industry’s business model. Not being able to easily access information on how many providers, services, and their subsequent costs go into certain medical procedures keeps patients in the dark and prevents them from making well-informed decisions. Hospitals continuing to utilize the opaque fee-for-service payment model puts patients in emergency situations in a helpless position where there’s no time to figure out what’s in network and what isn’t.

If we had a consumer-centered, market-based model that required transparency in costs and quality, accountability across the continuum with payments tied to outcomes, and real competition based on data that is made available in consumer-friendly ways, we wouldn't have the problem with surprise bills we see today.

Legislation adds bureaucracy, and bureaucracy tacks on time. Consumers want solutions now, and we have the ability to give them that. All we have to do is make better use of laws that already exist, give patients the tools to make educated healthcare decisions, and provide truly value-based care by shifting away from fee-for-service and toward risk-based arrangements that increase accountability. Some health systems have already started making progress, and those that dive in now will be grateful for doing so in the years to come.