"Surprise Billing" Solutions Must Prioritize Patients and Taxpayers

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Hospital patients are being hit with thousands of dollars in “surprise bills,” but Congress shouldn’t make matters worse with bad legislation. Some members of Congress have floated the idea of attaching "surprise billing" legislation to an end-of-year government funding bill. Surprise billing is a complex problem that requires innovative solutions, and the issue deserves a full debate in Congress, not an emergency band-aid that could make the problem worse.

Provisions that have been introduced in Congress to address surprise billing introduce what could be a single-payer health care system in disguise. These include additional price controls, federal benchmarks, out-of-network caps, or rate-setting that are all solutions that lead to more government control over who gets health care and who pays for it.

Washington shouldn’t interfere with price controls that make doctor and hospital services scarcer. Also, price controls shift costs to others leaving taxpayers on the hook. 

Less access, worse care, higher costs – Congress shouldn’t inflict these headaches on patients or taxpayers. 

Unfortunately, Congress is considering tacking bad legislation on to a year-end budget package - causing worse outcomes for patients and taxpayers without a real debate in Congress.

There are better ways to stop surprise bills, like clearer enforcement of truth in advertising rules, more accurate information on networks, and stronger cost transparency for patients. 

Congress Can Address "Surprise Billing" - But Not With Government Rate-Setting

The National Taxpayers Union's analysis of legislation making its way through Congress finds major flaws. Benchmark rate-setting can lead to provider shortages, which would harm both patients and taxpayers. In an issue analysis, NTU laid out a better way to address the problem of surprise billing:

  • Empower the Federal Trade Commission to ensure that the issues that lead patients to receive surprise medical bills are addressed at the root of the problem, making sure that insurers are transparent and efficient with patients. This has the advantage of relying on existing government authority rather than increasing power and scope of government to interfere between patients and doctors.
  • Address network complexity by requiring insurers to keep up-to-date databases so that customers can shop for services.
  • Define “appropriate floors for minimum levels of access,” but rely on qualitative rather than quantitative standards.

These and other reforms would address the root causes of surprise billing without resorting to an unprecedented expansion of government power, inserting federal bureaucrats into the relationship between doctors, patients, and insurers.

Study and Tackle the Root Causes of Surprise Billing

NTU helped lead a coalition of patient and taxpayer organization this year urging Congress to take real steps toward solving this problem rather than stack new government mandates on top of each other. As we wrote to Congress:

Solutions to the costs of healthcare, including surprise billing, should not involve government rate setting or price controls. There is some evidence that suggests the problem of surprise medical billing could be caused in part by existing federal mandates. This should be researched further. Doug Badger of The Heritage Foundation summarizes it well when he said, “Instead of choosing between flawed solutions advanced by those who profit from the problem, Congress should devise market-oriented proposals that preserve the freedom to contract.”

The political pressure to fix the problem of surprise medical billing is understandable. However, the reasons for surprise medical billing are not entirely clear, and legislative action should yield to the need for further evaluation of the issue.

The surprise billing issue requires more than faith in federal bureaucrats' abililty to simply mandate the problem away. There are real solutions that can be found - but government rate-setting is not the answer.