What would you do if you received an unexpected or “surprise” medical bill for $500? In 2017, the Kaiser Health Tracking Poll found that 45% of Americans would have a difficult time paying an unexpected medical bill for $500, 19% would not be able to pay it at all, and 20% would incur more indebtedness by placing it on a credit card. Others might resort to borrowing money from friends, family, or a bank.
While many studies focus on the cost of medical bills nationwide, we know Texans are very much a part of this national financial dilemma. It is estimated that 38% or more emergency visits in Texas have resulted in out-of-network charges. In fact, our state has some of the highest rates of out-of-network charges nationally. Therefore, it makes sense that Texas has enacted some of the nation’s most aggressive legislation.
So what exactly is surprise medical billing?
Surprise medical billing or “balanced billing” occurs when a patient incurs exorbitantly high medical bills for care they thought was covered under their insurance plan. Such cases are frequent in emergency situations and also with anesthesiologist, and lab testing. Because insurance companies are constantly shrinking their provider networks, patients often receive out-of-network care even if they’re visiting an in-network health care facility. As a result, many patients find themselves stuck in the middle of payment disputes between their insurers and medical providers.
In 2009, your Texas Legislature passed a law that established a mediation process overseen by the Texas Department of Insurance for balance billing issues with state-regulated insurance plans involving certain doctors. In 2015 and 2017, lawmakers took further action by expanding on this topic and enacting protections such as access to include all types of out-of-network medical providers at health care facilities, such as free-standing emergency rooms. The law also provided a pathway for patients to gain mediation assistance for any emergent care balance bill, whether in or out-of-network, over $500. Each year, thousands of Texans are assisted with additional claim payments and refunds with an estimated $46 million in savings for patients in Texas since 2015.
During the 2019 legislative session, lawmakers from the Senate and House came together in a bi-partisan fashion to further lead on this issue by passing Senate Bill (“SB”) 1264. This new law prohibits all non-network facility based medical providers at network hospitals and all non-network emergency care providers from sending balanced billing to patients who have state regulated plans. While patients are still responsible for applicable payments, such as co-pays, Texas has again set a tone for the rest of the nation to follow.
It is time for our federal legislators to follow Texas and pass a commonsense solution to eliminate surprise medical billing at the national level. A University of Chicago study showed about 57% of people in the U.S. are caught off guard by surprise medical bills, thus it is clear this issue extends far beyond Texas.
I encourage people to learn about what is being proposed at the national level in both the U.S. House and Senate. In my opinion, enacting government price controls, or “benchmarking”, to resolve billing disputes between insurance companies and health care providers boasts dangerous implications. While this may shield patients from surprise medical billing, it could also undermine the strength and integrity of our local hospitals and emergency rooms, especially in rural parts of Texas. I think government rate setting (price controls) ultimately undermines our healthcare systems and creates a top-down, anti-free market approach. The result will be hospital closures and provider consolidation, which jeopardizes patient access to care, eliminates options, and creates higher costs for patients.
However, federal proposals centered upon Independent Dispute Resolution (IDR) impress me as a more pragmatic and free-market approach. Similar to the mechanism included in SB 1264, IDR implements an open negotiation process between providers and insurers. Unlike benchmarking, this promotes greater transparency among insurers and helps ensure financial stability for health care facilities by providing interim payments based on the market value of services received until an impartial mediator determines a final payment amount. This is especially crucial for our nation’s rural health care centers.
As ending surprise billing is debated more widely at the national level, I hope our federal government will look to Texas who is leading our country by fighting back against this practice. While we will continue our work in Austin next session, I certainly hope to see an end to surprise medical billing once and for all for every American.
It’s an honor to represent you in the Texas House of Representatives. If you have any questions about the changes for state regulated health insurance plans or any other matter important to you, please call me at 512.463.0688 or email [email protected].