The Obama administration has taken note of the recent stories about how health care is still too damned high, even for those who have insurance. In an effort to keep the focus on the "Affordable" part of the Affordable Care Act, the administration included an item in its budget to address one part of those high costs: "surprise" medical bills from providers they didn't know were not in their allowed network.
Embedded within President Barack Obama's 2017 budget for HHS (PDF) is a provision to "eliminate surprise out-of-network healthcare charges for privately insured patients." Details are scant, but the administration would try to solve the problem by requiring physicians who "regularly provide services in hospitals" to accept in-network rates, even if they aren't in the insurer's network. Hospitals would also have to "take reasonable steps" to ensure patients see in-network physicians.
Patients face unexpected charges usually because of large payment disagreements between insurance companies and physicians. Physicians refuse to participate in an insurer's network, arguing insurers are low-balling them, but insurers say doctors ask for unreasonably high rates. Hospitals, and patients, are often left in the middle.
Under Obama's budget, patients would be removed from the disputes, and physicians would have to cave to the insurers' rates. That differs from New York, which recently passed a law that set up an arbitration process for insurers and providers to work out their differences while holding the patients harmless. Other states such as Pennsylvania also are looking into ways to solve the issue.
That's not going to go over particularly well with physicians' groups, like the American Medical Association, which points to the insurance companies as the problem because they don't reimburse enough. Outgoing AMA President Dr. Steven Stack says that "[i]nsurers should either be required to pay physicians fair market rates or else disclose to their members that they pay under-market value and offer an inadequate provider network." Incoming AMA President Dr. Andrew Gurman concurs, saying that these surprise healthcare bills "are a symptom of a much larger set of problems that have resulted from the way health insurers price their products, organize their provider networks and interact with non-contracted physicians."
A fix for this isn't going to be easy, but it is on the administration's radar, and is a hint for the next president—should he or she be a Democrat—of one of the immediate things that needs to be done in healthcare reform.