Surprise Billing, Medicare for All: What's at Stake for Anesthesiologists

Two issues at the center of the U.S.’s ongoing health debate have drawn the attention of the American Society of Anesthesiologists (ASA): surprise billing and Medicare for All. In both cases, the ASA sees big problems with proposals that tie new policies with existing Medicare payment rates, which for anesthesiologists typically run about a third of what commercial payers pay.

Medicare for All

This issue hits hardest with the proposed ”Medicare for All” bill and several variations proposed in both the House and the Senate. Though each bill is slightly different, most of them expand the Medicare program to include younger or even all Americans, presumably within the same or a similar system as it functions today. A hearing was held earlier this month to discuss the Medicare for All bills authored by Rep. Pramila Jayapal and Sen. Bernie Sanders (H.R. 1384, S1129), which would essentially eliminate private insurance and transform Medicare over two years into a nationwide, single-payer system with no age limits. The House version currently has 113 co-sponsors, though Democratic leaders are not that supportive.

In late April, ASA President Linda J. Mason, M.D., FASA, spoke out about the proposed healthcare overhaul, saying it would “be devastating to our practices.”

“Medicare payments for anesthesia have been inadequate and deeply flawed for many years, a situation specific to anesthesiology. Under Medicare, anesthesia services are only paid 33% of private insurance payment rates, the lowest rate among all health care services. On average other services are paid at 75% of private payment rates,” Mason said in a prepared statement. “This is a persistent challenge our specialty faces, and the Medicare for All legislation would significantly exacerbate this issue. We will continue to advocate for fair payment for anesthesia services while ensuring patient access to high-quality care.”

Surprise Billing

The Medicare problem surfaces as well in the recent debates over surprise billing, or what the ASA refers to as “surprise insurance gaps.” A new study by Karen Pollitz, Matthew Rae, Gary Claxton, Cynthia Cox, and Larry Levitt of the Kaiser Family Foundation released this week shows that as many as 1 in 6 patients have received at least one out-of-network charge as the result of an emergency room visit or an inpatient hospital admission. That same study also showed two-thirds of Americans are worried about being able to afford surprise medical bills for them and their family.

With several pieces of legislation addressing surprise billing in the pipeline in both the House and the Senate, nearly all legislators and industry leaders agree with the principle of holding patients harmless, especially when an emergency requires unknowingly out-of-network services. What policymakers and stakeholders don’t agree on, however, is how providers will be paid for those services.

Among the ideas being floated are “network matching,” which would require practitioners who work at a facility to become in-network with every plan the hospital has a contract with, and regional benchmarking, which also uses a payer’s own average rates to determine payment. Providers oppose these methods, saying they disincentivize payers from negotiating in-network rates with physicians and other providers.

“We believe health plans should not be absolved of their core function of establishing provider networks and negotiating rates with providers,” testified Tom Nickels, AHA executive vice president, for a hearing of the Senate Committee on Health, Education, Labor and Pensions (HELP).

Some lawmakers have also considered tying payments to Medicare rates, which providers also believe is unfair.

“Our concern is—and it’s well documented—that Congress’ own advisory board MedPAC says that Medicare does not pay the cost of hospitals that are fair. To base anything on Medicare rates, I think is a mistake,” Nickels said. “Secondly, there is no difference between that and Medicare for All which was just described earlier which we have real concerns about.”

The ASA agrees with Nickels’ position, advocating for an arbitration process to allow payers and physicians to work out payment once the patient has been protected.

“Congress should look to the successful New York state model, where patients are responsible for nothing more than their in-network copays and deductibles, where a dispute resolution process was created to address physician and insurer disagreements, and payment guides are based on the market, not inaccurate Medicare payments, which represent less than one-third of what is usually paid for anesthesia care,” the ASA’s Mason wrote in a letter to the Wall Street Journal.

The ASA currently is throwing their support behind the “Protecting People from Surprise Medical Bills Act,” co-sponsored by Representatives Raul Ruiz, M.D. (D-CA), Phil Roe, M.D. (R-TN), Joseph Morelle (D-NY), Van Taylor (R-TX), Ami Bera, M.D. (D-CA), Larry Bucshon, M.D. (R-IN), Donna Shalala (D-FL), and Brad Wenstrup, D.P.M. (R-OH). According to an ASA press release, this proposed legislation has “robust patient protections that removes patients from billing disputes and holds them harmless from surprise medical bills,” while also implementing the New York state model, which “has been in place since 2015 and has reduced complaints related to surprise bills while also saving health care dollars.”

The House and Senate now have two relatively similar bills, and unfortunately for the ASA and other provider groups, the Ruiz bill is not one of them. S.1895 – “A bill to lower health care costs” was cosponsored by Sen. Alexander, Lamar (R-TN) and Sen. Murray, Patty (D-WA), the Democratic and Republican leaders of the Senate HELP Committee, and “No More Surprises: Protecting Patients from Surprise Medical Bills,” was cosponsored by Reps. Frank Pallone (D-NJ) and Greg Walden (R-OR), the Democratic and Republican leaders of the House Energy and Commerce Committee, and currently is still in draft form. These two bills both include patient protections and benchmarking for provider payments. A third bill, S.1531- “Stopping The Outrageous Practice of Surprise Medical Bills Act of 2019,” introduced by Sens. Bill Cassidy (R-LA), Michael Bennet (D-CO), Todd Young (R-IN), Maggie Hassan (D-NH), Lisa Murkowski (R-AK) and Tom Carper (D-DE), is similar to the other two, though it does make provision for arbitration if payers and providers don’t agree on the benchmarked rate.

According to Loren Adler, associate director of USC-Brookings Schaeffer Initiative for Health Policy, the fact that an influential health committee in the Senate and an influential health committee in the House are on the same page is a positive step.

“There’s some logic to moving trains in the same direction,” Adler told Kaiser Health News.

Though not all stakeholders would agree that the movement is logical. Just ask the ASA.