Only in healthcare do consumers routinely buy goods and services without having any idea what the prices are.
For people with insurance, that’s not a big deal — as long as they stay within their plan’s network of doctors and hospitals. The problem is that in addition to having no visibility into the price of care, they may have no idea whether their in-network hospital or doctor is bringing in an out-of-network specialist to help out — for example, the anaesthesiologist who provides the sedatives or the radiologist who examines the X-rays.
This is a huge financial threat to many Americans, and lawmakers across the country have struggled to end it. On Thursday, President Trump entered the debate by calling on Congress to end surprise medical bills by passing legislation based a set of principles he said were designed to attract bipartisan support.
His interest in the topic is welcome, and it may prod lawmakers to find a solution to a problem that pits one powerful special interest — health insurers — against another — doctors, hospitals and other healthcare providers. But the principles Trump outlined cover just the simplest aspects of the issue. They appear to be silent on the tough questions that lawmakers have been unable to answer.
And maybe that’s the best thing Trump can do if he really wants a solution. His work on healthcare issues has been incredibly polarizing — in particular, his incessant attacks on the Affordable Care Act and Medicaid. His administration has sought to lower insurance premiums by increasing access to plans that offer less protection, a strategy that helps younger, healthier people at the expense of those with preexisting conditions.
In fairness, the Trump administration has done good things on some healthcare issues, particularly in trying to bring down the cost of prescription drugs. It unveiled its latest initiative Wednesday: a rule requiring drug makers that advertise costly prescription medicines to consumers to prominently disclose the drugs’ list prices. Although it’s sure to be challenged in court, the rule is consistent with the administration’s efforts to bring badly needed transparency to the healthcare industry.
And again, just by putting pressure on lawmakers to act on surprise medical bills, Trump may push them to forge consensus on how to move forward. The principles he laid out Thursday are good (albeit minimal) ones: Patients getting emergency care should not have to pay more for out-of-network services than they would pay in-network, and those getting non-emergency care at an in-network facility should be informed in advance of any out-of-network providers and what they will charge.
California went further in 2016, passing a law barring not just surprise bills, but out-of-network charges levied for non-emergency treatments at in-network facilities. The main hurdle to the bill was deciding who loses and how much when consumers are shielded from higher charges — the out-of-network provider or the insurer? The Legislature ultimately decided to use Medicare reimbursement rates as a benchmark and required state regulators to set up a binding dispute resolution mechanism for providers and insurers. (State lawmakers are now trying to come up with a solution for emergency care and for employers with self-funded health plans, which were not included under the 2016 law.)
Administration officials told reporters that they do not support binding arbitration. Nor does their proposal include any benchmarks for pricing. Equally problematic, Trump’s principles would offer no protection for people seeking non-emergency care and being forced by in-network providers to accept out-of-network services. They would simply be told in advance that they’d have to cover potentially staggering costs out of pocket.
According to Joe Grogan, director of the White House domestic policy council, surprise medical bills are a pervasive problem at hospitals, affecting an estimated 14% of outpatient emergency room visits, 20% of admissions that come through the ER and 9% of elective admissions. He added that a relatively small number of hospitals are the main sources of out-of-network billing surprises — 15% of hospitals have more than 80% of the visits that led to surprise medical bills.
A House committee recently held the first-ever congressional hearing on surprise bills, so the issue is on lawmakers’ radar screen. But a lot of work remains to be done to reach consensus on a solution — especially on the questions for which the Trump administration is not proposing an answer.