The “surprise bills” on U.S. hospitals are about to disappear

New York – The “surprise bills” that cost millions of dollars each year to patients in US hospitals are finally doomed to disappear thanks to new legislation that will begin to apply in 2022.

The law, hidden in the huge stimulus package approved in Washington to close the year, seeks to end a practice hated by almost everyone, but which has taken years to be curbed due to the multimillion-dollar “lobbying” efforts of the companies that benefit from it.

The so-called “surprise bills” are usually given when a patient goes to a hospital that is within the network covered by their insurance, but is treated by a doctor or other professional who is not within that network.

This doctor invoices his services separately and at a higher price – as he does not have a contract with the insurer – and, when the insurance refuses to cover them – due to being excessively high prices – the payment falls on the patient.

According to several studies, the situation occurs 20% of the time an American visits the emergency rooms of a hospital, where he is obviously not in a position to choose which doctor treats him or to find out about ahead of the costs it may face.

It is also common to encounter this type of situation in transfers to hospitals, with ambulances that are not part of the network covered by the insurer even though the medical center is.

“It’s terrible,” Scott Morton, a professor of economics at Yale University who has been investigating the problem in recent years, told Efe.

inflated prices

The average “surprise bill” is just over $ 600, but there are common cases where it’s thousands of dollars or even over $ 100,000.

“These prices are often three times higher than usual”, Explains Scott Morton, who stresses that, in the absence of an agreement with insurers, the doctor can “literally charge the price he wants.”

The phenomenon of “surprise bills” has skyrocketed in recent years, with staffing companies turning it into their business model and attracting the interest of investment firms.

The tactic of these companies is to hire doctors who work in emergency rooms and get them out of the agreements between the hospital and the insurers, so that they can charge higher prices.

“It’s a deceptive tactic that’s clearly hurting consumers and raising healthcare costs”, Points out Scott Morton.

However, with millions of dollars invested in this business, several private equity firms have spent large sums of money in recent years to prevent the regulation of a way of doing business that has been widely criticized by insurers and users.

The unpopularity of these practices became clear with the bipartisan support received by the law banning them in a tremendously fractured U.S. legislature.

A solution, but not complete

Starting next year, when medical providers and insurance companies fail to agree on a price, they will have to employ an arbitration system to set a “fair” amount based, in part, on the cost of similar services.

Thus, patients should be protected from these “surprise bills” and, at most, will have to deal with the payments that their insurance plan requires for treatments within their network.

The arbitrage mechanism finally decided is the result, in part, of the industry’s “lobbying” efforts, which managed to avoid a total ban on the practice or other formulas such as pre-set prices.

According to some analysts, the COVID-19 crisis helped these interests, causing lawmakers to have more inconvenience in curbing something that benefits many doctors in the midst of a pandemic.

The new law also excludes ambulances, which are responsible for a significant number of “surprise bills”, although it does prohibit the practice in the case of air transport, which generates some of the highest surcharges.

In an almost iconic case of this problem, last April a woman ill with COVID-19 was found with a bill of more than $ 52,000 after being airlifted from one Philadelphia hospital to another located in a just over 30 miles while she was intubated and unconscious.