The last thing you remember is driving your car. When you wake up in the hospital, you’re told that you were in an accident, life-flighted to a trauma center and operated on twice. Thankfully, you are going to recover, and you have insurance.
A month after your release, you receive $90,000 in unexpected medical bills because the emergency helicopter and two anesthesiologists who assisted in your surgery were not in your health plan’s network. This nightmare is all too familiar: unsuspecting and vulnerable patients grateful for care but saddled with expensive and unexpected bills, even though they received care at a hospital designated as “in network.”
Unexpected medical bills are the number-one concern among Americans, according to a Kaiser Family Foundation poll. Sixty-seven percent of Americans said they were very or somewhat worried about being able to afford a medical bill they received due to no fault of their own.
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This is a painful symptom of a dysfunctional and unaffordable health care system and one of the many critical issues that the Lower Health Care Costs Act of 2019 effectively addresses. Almost everyone agrees that this has to stop, but what looked like bipartisan progress is now getting mired in the politics of special interests and industry actors putting profits over patients.
It may seem surprising that our organization, which represents some of the largest private sector employers in the world, is seeking public policy intervention. But we can’t do this by ourselves.
The health care market is broken, and the government needs to step in for course correction. We believe in market solutions, and the bipartisan Senate Health, Education, Labor and Pensions Committee proposal, which passed 20-3, is the best option for making the market work by resolving unexpected bills for out-of-network care and creating necessary transparency of hospital, provider and drug prices.
As a way to avoid cost controls, industry groups are now proposing that cost disputes go to arbitration. If the aim of Congress is to end surprise medical billing and curb medical costs for American families, requiring that all payment disputes go through a lengthy, government-mandated, non-transparent arbitration process is not the answer.
While arbitration may help a single patient and his or her family for the balance of a surprise bill, it will ultimately hurt everyone. Costs will continue to grow; families will bear more cost burdens, and employers have to sacrifice wage increases to pay higher premiums.
The Lower Health Care Costs Act proposes to pay the provider a fair median rate of in-network doctors of the same specialty and in the same geographic market. This is called the benchmark price. This rate would be based on local market prices that have already been negotiated between health care providers and health plans.
The alternative arbitration model does not consider the prices negotiated between health plans and providers and is unlikely to reduce costs. The Congressional Budget Office has indicated that benchmarking is the most effective option for lowering health care costs and estimated that it will save the government approximately $24.9 billion over the next 10 years. The naysayers are limited to those few providers who have been taking advantage of dysfunctional market dynamics and the lack of transparency to overcharge unsuspecting patients.
Patients may not care whether Congress uses arbitration or benchmarking in its legislation to eliminate surprise medical bills, but what they do care about is access to affordable, high-quality health care for themselves and their families. A functional health care market does not regularly drive families into bankruptcy; it does not depend on GoFundMe campaigns for treatment costs; it does not require the world’s largest employers to absorb annual cost increases of 4 to 20 percent with no corresponding improvement in quality or outcomes.
For the sake of our employees and their families, we ask Congress to build on the bipartisan momentum and pass a bill that will end surprise medical bills and bring down the overall cost of health care.
Elizabeth Mitchell is the president and CEO of the Pacific Business Group on Health, a coalition of 60 public and private companies that collectively purchase over $100 billion annually in health care and provide health care coverage to 15 million Americans and their dependents.
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