Congress Nears COVID Aid Deal That May Include Surprise-Billing Fix

Congressional leaders are closing in on a coronavirus relief-deal that could include legislation to protect patients from surprise medical bills. Leaders hope to clinch an agreement this week and tack it onto Congress’ year-end spending bill, although finalizing bill text and voting in both chambers could drag into the weekend or next week.

The aid package is likely to total around $900 billion and include a second round of direct checks of $600 to $700, and a weekly unemployment boost set to last through March. Roughly $325 billion would go toward small business relief, including $257 billion for the Paycheck Protection Program. Two major sticking points – funding for state and local governments and liability protections for employers – are being left out of the final package.

Still in play, however, is legislation aimed at cracking down on surprise medical bills modeled on a bipartisan agreement reached last Friday between the leaders of key House and Senate committees. The deal comes after years of intense lobbying by industry groups over how to settle payment disputes between health care payers and out-of-network medical providers. Arbitration is the method favored by doctors and hospital groups, but employers and insurers have pushed for settling disputes with payment of a median in-network rate for a particular service or procedure. 

While agreement and final details on a surprise-billing fix are uncertain as of this writing, draft legislation would resolve payment disputes through arbitration if payers and providers (including air and other ambulance providers) cannot reach an agreement on their own. That would set up an independent dispute resolution process, without a minimum billed-charge threshold, for either side to ask for arbitration. Both sides would make an offer, and an independent third-party arbitrator would pick one. In reaching a decision, the arbitrator would have to consider a number of factors, including:

  • The median in-network rate
  • Information related to the provider’s training and experience
  • The parties’ market share
  • Previous contracting history between the parties
  • Complexity of the services provided

Patients would not be required to pay more than their insurance plan’s in-network cost-sharing amounts, including deductibles, for both emergency and non-emergency situations when they cannot choose an in-network provider. 

Plan sponsor-friendly changes to the draft measure are still possible, however, including the possible addition of provisions drawn from the employer-backed Lower Health Care Costs Act (S 1895). These include proposals to ban “anti-steering” clauses in contracts between providers and plans that restrict plans’ ability to create “preferred” in-network tiers and set new disclosure and reporting requirements for pharmacy benefit managers (PBMs).

The fate of all these proposals remain unclear as Congress races to finish its work for the year, but Mercer’s Law & Policy group will provide a full analysis of any employer-focused changes that become law.

Geoff Manville
by Geoff Manville

Partner, Mercer’s Law & Policy Group

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