Legislation to End Surprise Medical Bills, Lower Drug Costs Advances

August 2019 ~

As reported in the issue July issue of the Insurance Updates newsletter, the Senate Health, Education, Labor and Pensions (HELP) Committee, in June, amended and approved the proposed Lower Health Care Costs (LHCC) Act in a vote of 20 to 3. In July, the House Energy and Commerce (E&C) Committee approved its version of the LHCC legislation.

If finalized, the bill would reimburse providers for out-of-network services at the median in-network rate. The legislation would also limit patients’ out-of-pocket costs for air ambulance transport to the in-network cost-sharing amount.

The original text of the LHCC Act detailed three options for determining the reimbursement rate for surprise scenarios. Under the amended act, insurance companies would reimburse providers based on the local median contracted commercial amount they pay other providers they contract within that geographic area.

The bill’s original text also included what’s known as “benchmarking” to set the payment amount for out-of-network doctors. During the panel’s markup, the E&C Committee added an amendment, which would create a “backstop” to the measure’s benchmarking approach.

Under this amendment, the physician payment would still be based on a benchmark, but if the amount is lower than the expected amount, the physician can appeal to an arbitrator. Physicians will only be permitted to use this backstop if the dollar amount in question is more than $1,250, and the arbitrator can consider only the complexity of the case and the quality of care.

While the E&C’s amendment is meant to be a compromise between positions, the House bill no longer matches the primary legislation moving through the Senate.

Members of the HELP Committee panel applauded the House action and Committee Chairman, Lamar Alexander, has indicated that the group open to further discussions.

“The House is taking a step in the right direction,” said panel member Senator Bill Cassidy in an email. “We need to end up in a place that gives patients security while having a level playing field for providers, hospitals and insurers.”

The LHCC Act is expected to go before the full Senate for consideration this month.

Source(s): Healthcare Business Management Association (HBMA), “Surprise” Medical Bill Legislation Advancing Through the Senate, Washington News, July 2019; Kaiser Health News; Fierce Healthcare; The Hill; Becker’s Hospital Review;

 

 

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