White House Could Start Moving on Surprise Medical Bills

While most experts say the administration alone can’t resolve the issue, there are tools officials could look at to improve protections for patients.

President Trump, with Health and Human Services Secretary Alex Azar, talks about drug prices during a visit to HHS in Washington on Oct. 25, 2018.
AP Photo/Susan Walsh
Jan. 29, 2019, 8 p.m.

The Trump administration could start tinkering with the issue of surprise medical bills while waiting for congressional action, experts say.

While comprehensive action will likely have to wait on lawmakers, medical experts floated ideas to National Journal on regulatory mechanisms that could be used to improve protections against surprise bills. Some of the options for the White House include leveraging Medicare’s conditions that health organizations must meet in order to participate in the program, increasing notification to patients when a provider is out of network, and communicating to states how much power they have to regulate this issue.

The spotlight on the sticker shock of high hospital bills reached the White House last week when the president held a roundtable with patients, Labor Secretary Alexander Acosta, and Health and Human Services Secretary Alex Azar on high health care costs. “Nearly 40 percent of insured adults report receiving a surprise medical bill in the last year,” Trump said. “Patients should know that the real price—and what's going on with the real prices of procedures, because they don’t know.”

Surprise medical bills often materialize after emergency-room treatments or planned procedures when a patient does not have a choice over the attending physician or other treating providers that could be out of network.

“Surprise billing is an unpleasant surprise for everyone. I think there could be common ground there,” Rep. Kevin Brady, the top Republican on the Ways and Means Committee, said on Monday night.

Experts who spoke to National Journal were split as to how much the administration can do on its own, but they all agreed the White House has ways to start tackling the problem of surprise bills. Suggestions included using the bully pulpit to pressure providers into setting reasonable prices, and changing Medicare participation requirements to ensure hospitals in the program use only doctors who are in-network with every plan the facilities participate in.

Sara Rosenbaum, the founding chair of the Department of Health Policy at George Washington University Milken Institute School of Public Health, said trying to address the issue through Medicare’s Conditions of Participation—requirements health care organizations must meet in order to participate in the program—is an obvious option for the federal government.

“By rule, the administration could say that hospitals as a condition of participating in Medicare would have to assure that all of their affiliated positions participate in certainly any Medicare Advantage networks that they’re part of, as well as other insurance networks that they’re part of—other health plans or insurance networks,” Rosenbaum said.

“That’s the most obvious and powerhouse area that I would think that the federal government could explore,” she said.

Jack Hoadley, a health policy analyst and political scientist at Georgetown University’s Health Policy Institute, agreed that Medicare’s Conditions of Participation could be examined, but added that it would likely be met with resistance from stakeholders. “It’s certainly something that the hospitals would push back on, so whether it’s politically possible—I think that’s a real question,” Hoadley said.

Christen Linke Young, a fellow at the USC-Brookings Schaeffer Initiative for Health Policy, threw cold water on the idea that these requirements could be applied so broadly. “It’s hard to imagine how the administration could justify that Medicare needs a hospital or physician to behave in this way,” she said.

Instead, Young said, the Conditions of Participation could be used to require hospitals to notify consumers when a practitioner is out of network, but that likely wouldn’t affect the ultimate cost that patients may get stuck with.

She added that the Labor Department could potentially clarify to states what they could do to address the problem of surprise billing. Some states, such as New York and Illinois, have already passed laws that have arbitration processes to resolve payment disputes. This approach works reasonably well, according to Young.

“It doesn’t solve the problem 100 percent of the time,” she said. “And some states make consumers opt into the arbitration, versus just having it all happen behind the scenes without the consumer knowing about it. But basically, that approach works by sort of getting rid of the provider’s ability to write their own ticket.”

Georgetown University experts found that nine states had “comprehensive protections” against surprise billing, according to an analysis coauthored by Hoadley that The Commonwealth Fund published on Jan. 18. Such laws include a dispute-resolution process or an adequate-payment standard, a prohibition on balance billing, and protections for consumers from extra provider charges, among other features.

And the Trump administration could always turn to a familiar tool that has been employed to pressure pharmaceutical companies to lower high drug prices: the bully pulpit.

“They’ve flexed their muscles to kind of say, ‘We are going to scrutinize your drug prices or your price increases,’ to pharmaceutical manufacturers,” said Erin Trish, associate director of the USC Schaeffer Center. “So you could imagine the administration saying something similar to physicians and other health care providers in saying, ‘We’re scrutinizing this; we’re going to do something about this.'

“Whether or not that’s effective, I don’t know. I think that issue is still playing out in the pharmaceutical space,” she added. “But you could imagine the administration doing those types of things, where they’re bringing light or bringing attention to the issue and saying, ‘We’re going to scrutinize the prices that you’re charging patients in these particular situations.’”

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