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Surprise billing proposal wins support of physician groups — but leaders want 'inadequate' networks addressed

A new bill that would establish an arbitration process to settle disputes over "surprise" medical bills has garnered support from the American Association of Orthopaedic Surgeons, the American Medical Association and the Physicians Advocacy Institute, among other industry groups.

The Consumer Protections Against Surprise Medical Bills Act — which was unveiled by the U.S. House Ways and Means Committee on Feb. 7 — would give providers and insurers up to 30 days to negotiate a payment rate for out-of-network charges.

In the event that they can't agree on a rate, they could enter into an arbitration process. Both parties would submit proposals to an independent mediator, who would make the final decision, in a process lasting up to 30 days.

The mediator would be required to consider the median contracted rate for services in the region and would be prohibited from considering "usual and customary charges." The bill does not include a mediation threshold.

In addition, the bill would require that patients receive an explanation of benefits before their treatment. The EOB would detail the services, costs and provider network status.

AAOS President Kristy Weber, MD, urged the committee to clarify that median in-network rates should serve as "a floor and starting point for negotiation." The clarification would prevent insurers from using median in-network rates "a de facto benchmark to dictate prices and continue manipulating the market," she said.

Dr. Weber also said the bill underestimates how much time and effort it would take physicians to adequately value procedures and access total reimbursement data to do so. She and Physicians Advocacy Institute President Robert Seligson both called for the committee to address inadequate provider network sizes in the bill.

"Insurers should be required to maintain robust networks, or the trend toward out-of-network services that force patients to pay more will continue to accelerate," Mr. Seligson said. "This particularly hurts people with high-deductible health plans or limited out-of-network coverage."

Mr. Seligson asked that mediators be required to use "meaningful physician data" from an independent data collection entity to make their decisions, rather than using insurers' payment data, which he said could artificially lower rates below the actual cost of services.

The American Medical Association published a statement that didn't request any updates:

"We support the underlying mechanism for resolving these disputes, including the eligibility of all disputed claims for negotiation and mediation. We also appreciate that the mediator must consider a wide range of supporting information submitted by physicians in rendering a final determination."

If passed, the bill will take effect in 2022.

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