Under threats from lawmakers, who promised they would solve surprise balance billing themselves if hospitals and health plans couldn’t agree, a working group representing different sides of the debate has met all summer to find a mutually agreeable fix.
And they haven’t quite gotten there.
In July, the legislature’s Health Insurance Reform Commission ordered representatives from various health care organizations to draft a solution to balance billing, when an out-of-network provider bills patients for whatever their insurance company won’t pay.
Even when patients have insurance and go to an in-network provider, they might be slammed with an unexpected bill later on because one of their doctors wasn’t in their network, or because the doctor sent a blood test to an out-of-network lab.
The issue most commonly arises during emergency room visits, when the patient might go to a hospital that’s in the network and unknowingly see a doctor who isn’t.
“The industry, across the board, everybody — prescription benefit managers, health insurance companies, hospitals, doctors — none of them want to tell you how much it costs,” said Sen. Frank Wagner, R-Virginia Beach, during a commission meeting Tuesday. “And the goal would be to try to have competition, it reduces prices and it increases quality, we know that. But over and over again, everybody in this room tries to undermine these commonsense approaches. Meanwhile, we watch the cost of health care going up and up.”
Providers and insurers pointed fingers at each other at the July meeting and still appear to be at loggerheads.
“I’d like to report there’s complete agreement, but that would be stretching it a bit,” Frank Munyan, with the Division of Legislative Services, told the lawmakers. “There is a major issue on which there is no agreement, and that involves the green stuff.”
When it comes to non-emergency balance billing, both sides largely agreed that there should be some sort of notification process so the patient knows ahead of time if a doctor or an ancillary service like blood work is out of network.
But it’s different when it comes to emergency services, when patients rarely have the luxury of choosing a different doctor or service that’s actually covered.
Both the providers and the health plans proposed prohibiting balance billing, but the providers did so with caveats: No balance billing, but out-of-network providers must be paid a certain amount from the insurance companies.
“We are willing to say we will not balance bill the patient, but there needs to be certain protections in there,” said Scott Johnson with the Medical Society of Virginia, which represents physicians.
The providers suggested requiring a payment of 125 percent of the regional average for commercial payments for emergency services in whatever area the hospital operates, Munyan said.
That, Johnson said, is to ensure that doctors are paid fairly.
“If the in-network rate was so good, our doctors would accept it and be in-network, and that’s what we want,” he said.
But the health plans see things differently. Doug Gray, executive director of the Virginia Association of Health Plans, argued that paying out-of-network providers an average rate would take away the insurer’s bargaining power when negotiating network rates.
“If you give direct payment to a provider group who is out of network at a higher rate, they, in essence, will have guaranteed payment,” he said. “That helps them stay out of network longer and ask for a higher rate.”
It would mean, ultimately, that the consumer would have to pay, he said, either directly if they have a high deductible plan — because patients still have to pay all the co-pays and deductibles associated with their health plans — or indirectly through the premium increases the plans would need to cover the costs.
The lawmakers will consider the suggestions and decide what, if any, legislation they’d like to propose for the upcoming session.
“This whole thing concerns me,” Wagner said. “It’s the only business I know about where a consumer has no idea what the price of the product is.”