Surprise billing debate continues to transfix state and federal policy makers

NEW YORK, NY–March 6, 2019–FAIR Health today released a brief intended to increase clarity about the implications of various legislative choices related to surprise billing–a subject of intense debate on the state and federal level. Entitled Teasing Apart the Threads to the Surprise Billing Debate: Understanding Policy Choices through the Lens of Independent Data, the brief is based on FAIR Health’s experience consulting with policy makers and stakeholders on the issue and on data from its repository of private healthcare claims, the nation’s largest. FAIR Health is a national, independent, nonprofit organization dedicated to bringing transparency to healthcare costs and health insurance information.

Surprise or balance billing occurs when consumers receive bills, often substantial, for out-of-network emergency care or services they unexpectedly or unintentionally received from an out-of-network provider. Almost all stakeholders agree on protecting consumers from surprise bills that exceed their in-network responsibility, but there is considerable legislative debate on how to determine the amounts that plans should pay to compensate providers. In its new brief, FAIR Health outlines the varying approaches under consideration by federal and state policy makers and includes data visualizations that help reveal the implications of those approaches.

The brief discusses the option of mandating a value for reimbursement based on a clear benchmark, and details the four types of benchmark generally proposed:

• a percentile value based on the range of providers’ charges (nondiscounted fees) for a service in the relevant market;

• a formulation based on allowed amounts, which are the in-network fees paid under a plan to a provider for a service;

• a “hybrid” blend of benchmarks for billed charges and allowed amounts; or

• Medicare fee schedule rates or a multiple thereof.

Also discussed is the principal alternative to a mandate, independent dispute resolution (IDR), whether with or without articulated guidelines for reimbursement. The brief also considers the value of making reference to an independent, objective database in designing legislative solutions.

Data visualizations in the brief illustrate the implications of the varying approaches under consideration by federal and state policy makers. The visualizations compare different types of value, such as median charges and median allowed as well as Medicare fees, for different medical procedure codes in different states and local areas.

FAIR Health President Robin Gelburd stated: “Surprise bills are a pressing legislative issue across the country. The implications of various approaches to the issue are complex. We are pleased to use real-world data, reflecting actual healthcare economics in local markets, to help tease apart those implications.”

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FAIR Health is a national, independent, nonprofit organization dedicated to bringing transparency to healthcare costs and health insurance information through data products, consumer resources and health systems research support. FAIR Health possesses the nation’s largest collection of private healthcare claims data, which includes over 27 billion claim records contributed by payors and administrators who insure or process claims for private insurance plans covering more than 150 million individuals. FAIR Health licenses its privately billed data and data products–including benchmark modules, data visualizations, custom analytics, episodes of care analytics and market indices–to commercial insurers and self-insurers, employers, providers, hospitals and healthcare systems, government agencies, researchers and others. Certified by the Centers for Medicare & Medicaid Services (CMS) as a national Qualified Entity, FAIR Health also receives data representing the experience of all individuals enrolled in traditional Medicare Parts A, B and D; FAIR Health houses data on Medicare Advantage enrollees in its private claims data repository. FAIR Health can produce insightful analytic reports and data products based on combined Medicare and commercial claims data for government, providers, payors and other authorized users. FAIR Health has earned HITRUST CSF and Service Organization Controls (SOC 2) certifications by meeting the rigorous data security requirements of these standards. As a testament to the reliability and objectivity of FAIR Health data, the data have been incorporated in statutes and regulations around the country and designated as the official, neutral data source for a variety of state health programs, including workers’ compensation and personal injury protection (PIP) programs. FAIR Health data serve as an official reference point in support of certain state balance billing laws that protect consumers against bills for surprise out-of-network and emergency services. FAIR Health also uses its database to power a free consumer website available in English and Spanish and an English/Spanish mobile app, which enable consumers to estimate and plan for their healthcare expenditures and offer a rich educational platform on health insurance. The website has been honored by the White House Summit on Smart Disclosure, the Agency for Healthcare Research and Quality (AHRQ), URAC, the eHealthcare Leadership Awards, appPicker, Employee Benefit News and Kiplinger’s Personal Finance. FAIR Health also is named a top resource for patients in Elisabeth Rosenthal’s book, An American Sickness: How Healthcare Became Big Business and How You Can Take It Back. For more information on FAIR Health, visit fairhealth.org.