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Breaking Down Congress's Surprise Medical Law

It’s not exactly the most logical combination but tucked inside Congress’s latest relief bill associated with the COVID-19 pandemic was a measure aimed at eliminating surprise medical bills for patients.

A surprise medical bill occurs when a patient is treated by a facility or doctor outside of the patient’s health insurance network. This tends to happen when a patient is treated in an emergency situation and does not have a chance to make sure that the doctor or facility is part of his or her insurance coverage. Under the provisions of the bill, healthcare providers will need to work with an insurance carrier to reach a compromise on the bill. In the event the two sides are not able to reach a deal, the transaction will go to arbitration.

Estimates are that as many as 20% of emergency room visits incur a surprise medical bill for a patient, with the average charge about $600. Doctors charge more, as much as 7%, when a patient’s insurance is outside of the physician’s network.

Under the bill, air ambulances are banned from handing out surprise medical bills, but ground ambulances are not banned from doing so. Out-of-network providers will be banned from billing a patient for the balance of a medical bill unless they provided an estimate to the patient 72 hours before the procedure and the patient consents to the out-of-network care.

There have been a steady stream of individuals who have received surprise medical bills in the tens and hundreds of thousands of dollars and have generated sympathy from state and federal lawmakers. The state legislatures in Texas and California have enacted their own surprise medical billing laws, before Congress took up the measure.

Those stories were more powerful than comments from healthcare providers, doctors, and hospitals, who each shared concern about the impact of Congress’s new bill. Although providers seemed to be happier with this solution than the original plan, which would have established benchmark rates for different procedures.

Congress has been trying to fix this problem for several years, but the timing of the bill, as well as support from key lawmakers was able to push this bill across the finish line.

For healthcare providers, it is important to first understand that this bill will not go into effect until 2022. Developing the proper policies and procedures will be important to ensure compliance with this new law.

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