Opinion

Fixing High Healthcare Costs Should Help Patients And Not Insurance Companies

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Posted: Jun 24, 2019 12:01 AM
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Fixing High Healthcare Costs Should Help Patients And Not Insurance Companies

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The latest attempt to tame the healthcare beast is a surprisingly bipartisan effort coming out of the Senate. The Lower Healthcare Costs Act of 2019, introduced by Senators Lamar Alexander (R-TN) and Patty Murray (D-WA) would attempt to solve a problem that has attracted considerable attention recently- surprise medical billing. 

Surprise medical billing occurs when a patient who has insurance, receives a bill from a doctor after expecting the services they received to be covered and paid for by insurance. This troubling situation mostly occurs in an emergency situation and fortunately does not occur very often. However, when it does, it is aggravating to patients and costly.

The proposed Senate bill attempts to fix this problem by dictating that doctors not on insurance panels are paid a rate that is tied to the Medicare fee schedule in their community. This is a bad idea which will have far reaching ramifications, ultimately harming patients in the long run. 

It is important to understand that the surprise medical billing problem has been manufactured by the insurance industry and now the proposed “fix” will be made at the expense of the doctors who are taking care of patients, but have no voice in how they are paid.

The majority of health care today is paid by third parties. There is a Medicare fee schedule which is typically quite a bit lower than the rates that commercial insurers will pay. Doctors sign contracts with insurers, get on their panels to get access to patients, and accept the rates agreed upon by the doctors. Insurers try to pay doctors as little as possible, often less than Medicare rates. This level of reimbursement may not even cover a physician’s overhead. Consequently, there are doctors who refuse to accept these rates and, therefore, are not on an insurer’s panel. These are called non participating or “non-par” physicians. 

Another reason why a doctor may be non-par is because insurance companies intentionally keep them off their panels. This is what is called a “narrow network” and is another tactic intended to pay as little as possible for health care, by limiting access to patients.

Fixing this problem should not reward the insurance companies who have created it. Paying non-par physicians based on the Medicare fee schedule gives insurance companies an opportunity to lower reimbursement rates for ALL doctors across the board. This is another step towards destroying medicine in the U.S. and forcing doctors to sell their practices to hospitals, where prices are higher and service is typically lower.  

The American College of Surgeons strongly opposes this bill. Executive Director, David Hoyt M.D. said, “surgeons do not want their patients to bear the consequences of narrow networks and other gaps in insurance coverage that leads to surprise medical bills. However the solutions should not come on the backs of the physicians caring for them." He states that this is a one-sided solution that favors insurance companies and denies physicians the right of conflict resolution. This bill would lead to serious consequences to the entire healthcare system for years to come.

The very title of this bill - The Lowering Healthcare Costs Act - is a complete misnomer because it will do little to accomplish this goal when physician payments account for only 8 percent of total healthcare spending. There are other areas where savings can be realized and be effective.

The Trump administration has worked with physicians to generate ideas that would actually tackle the high costs in the healthcare system. Price transparency, an issue that President Trump strongly supports and is set to issue an executive order to address, would be far more effective in lowering the healthcare cost curve, by giving patients the information that they need to become better consumers. This is yet another move that his administration has taken on to give patients more control over their healthcare. It would be important for Congress to avoid the “fixes” that they have been known to come up with which have made healthcare more expensive and complicated for patients and physicians.