“Thousands and thousands of hardworking Individuals will not have to fret about sudden medical payments.”

President Joe Biden, in a Feb. 10 speech about reducing well being care prices.

Throughout a Feb. 10 speech about reducing well being care prices, President Joe Biden made a sweeping declaration that Individuals would not want to fret about shock medical payments.

“No extra shock billing. No extra,” mentioned Biden. “Thousands and thousands of hardworking Individuals will not have to fret about sudden medical payments.”

Biden was referring to a bipartisan regulation, the No Surprises Act, that was handed by Congress through the Trump administration in late 2020 and took impact on Jan. 1, 2022. The regulation is meant to guard shoppers from often-expensive out-of-network medical payments.

The president supplied this instance of the sorts of payments the regulation would stop: “In case your well being care plan didn’t cowl a specific physician however you didn’t even know he was being consulted and also you get an additional invoice for $2,000-$5,000 — they’ll’t try this anymore.”

Nonetheless, Biden exaggerated when he mentioned there can be no extra shock billing. He had a degree that the brand new regulation would offer newfound safety in opposition to sure fees for hundreds of thousands of individuals, however his assertion went additional than what the regulation accomplishes.

We determined to dig in and learn the way far the regulation goes to stop sudden medical prices.

Surprise Payments and the No Surprises Act, Defined

The No Surprises Act primarily protects shoppers in opposition to sure kinds of medical payments: these acquired by sufferers for care at an out-of-network facility — particularly, a hospital, a hospital outpatient division, or an ambulatory surgical procedure middle; or from an out-of-network medical supplier whom sufferers didn’t get to decide on. The act additionally protects sufferers from “shock” payments from an out-of-network air ambulance transport. Out of community means the physician doesn’t take your medical insurance coverage or isn’t included on the listing of authorized suppliers in your insurance coverage community.

The federal authorities estimates that the regulation will apply to about 10 million shock payments a yr. They’re usually related to emergency care offered when sufferers should go to the closest medical facility and might’t verify the community standing of the power or emergency room physicians. Additionally they might stem from nonemergency hospitalizations or surgical procedures at an in-network facility that contain a supplier, resembling an anesthesiologist or radiologist, who’s out of community and payments individually.

Earlier than the regulation, sufferers may very well be left on the hook for fees a lot greater than their insurer’s in-network negotiated price as a result of their well being plan may pay solely a part of the invoice or deny the declare utterly.

Making an attempt to get any portion of an out-of-network invoice coated usually required a number of paperwork and cellphone time with insurance coverage suppliers, and shoppers had been typically nonetheless left with an enormous invoice.

Nonetheless, with the No Surprises Act, shoppers are shielded from these out-of-network payments. Insurance coverage corporations are required to cowl the out-of-network claims, paying suppliers the speed they pay for the service when it’s delivered by an in-network supplier or facility and leaving shoppers liable for solely the in-network price sharing. Lastly, the brand new regulation created an arbitration course of that kicks in if the insurer and supplier dispute the fee charges and takes the buyer out of the negotiation.

“So if the brand new regulation works nicely, sufferers mustn’t solely lower your expenses, they may very well be relieved of some difficult claims-filing paperwork,” mentioned Karen Pollitz, a senior fellow for well being reform and personal insurance coverage at KFF.

A Few Caveats

Though the No Surprises Act is comparatively complete for out-of-network payments, some notable exceptions might end in massive payments for shoppers, mentioned Loren Adler, affiliate director of the College of Southern California-Brookings Schaeffer Initiative for Well being Coverage.

One evident omission is that fees related to utilizing a floor ambulance to get to a hospital in an emergency will not be coated. A 2021 Peterson-KFF Health System Tracker analysis discovered that half of emergency ground-ambulance rides resulted in an out-of-network cost for these with non-public medical health insurance.

It’s additionally essential to notice that politicians usually use the time period “shock payments” as shorthand for out-of-network payments. Sure massive medical payments that customers obtain for in-network care could also be “stunning” to them, however, technically, they received’t match underneath the No Surprises Act in the event that they’re not an out-of-network invoice.

“There are definitely loads of issues which might be surprises within the medical system,” mentioned Adler. “Akin to individuals don’t notice they’ve a deductible, and that’s a shock. Or your insurance coverage firm denies a declare, and that’s a shock.”

This may be complicated to shoppers who obtain a invoice that has nothing to do with what the No Surprises Act was designed to handle. As an illustration, shoppers can nonetheless be topic to large charges due to hospital overcharges or insurer errors, as proven in lots of tales within the KHN “Bill of the Month” series.

Nonetheless, the 4 well being coverage consultants we consulted advised us that Biden’s assertion was principally correct.

“My normal response is that it’s broadly appropriate,” mentioned Benedic Ippolito, a senior fellow and well being care knowledgeable on the American Enterprise Institute. “But it surely’s not fairly true to say that there are payments that you simply don’t want to fret about anymore.”

Shoppers Ought to Nonetheless Beware

There are a few different sticking factors within the No Surprises Act that would imply sufferers nonetheless find yourself with a big or stunning medical invoice.

Presently, the interim final rule implementing the No Surprises Act leaves some medical services — together with pressing care facilities, birthing facilities, hospice, habit remedy services, and nursing properties — off the listing of locations coated by the regulation.

One different problem: Amenities can ask sufferers to signal a previous written consent that waives their rights underneath the No Surprises Act in sure conditions; this enables sufferers to be charged out-of-network costs for procedures. Medical suppliers will not be allowed to ask sufferers to signal the shape for emergency care or for providers during which the affected person doesn’t select the physician.

“That’s to not say that there’s completely zero threat,” mentioned Matthew Fiedler, a fellow with the USC-Brookings Schaeffer Initiative for Well being Coverage. “In all probability the situation I’m most fearful about is post-stabilization care following emergency care.”

Fiedler mentioned that would imply an out-of-network facility would have the ability to cost a affected person at out-of-network charges if it acquired the prior written consent and confirmed that the affected person might have traveled to an in-network facility; or, maybe, for sure providers during which the affected person doesn’t select the physician.

Even in these instances, the supplier must get sufferers to signal a kind they could not perceive during which they waive their rights and put themselves prone to getting an out-of-network invoice they weren’t anticipating. “That’s not unattainable, however I feel it’s in all probability additionally not trivial,” Fiedler mentioned. “So, all issues thought of, I feel we’re speaking about actually uncommon situations.”

Even so, it’s essential for shoppers to bear in mind that whereas the No Surprises Act will shield them from most out-of-network payments, they may nonetheless obtain different kinds of stunning payments as a result of the U.S. has such a fancy well being care system. Whereas efficient, the regulation just isn’t infallible.

Our Ruling

Biden declared that due to the No Surprises Act, which took impact in January, hundreds of thousands of Individuals will not have to fret about sudden medical payments. It’s estimated the regulation will shield in opposition to 10 million shock payments a yr.

Though it’s true that customers at the moment are shielded from many out-of-network payments, which are sometimes termed “shock payments” by lawmakers, sufferers nonetheless might find yourself with different kinds of massive and sudden medical payments. Biden’s assertion is a bit too normal and sweeping and desires clarification and extra context.

We price this declare Largely True.

Sources

The Brookings Establishment, Understanding the No Surprises Act, Feb. 4, 2021

The Facilities for Medicare & Medicaid Companies, No Surprises: Understand Your Rights Against Surprise Medical Bills, Jan. 3, 2022

CNN, “Patients Won’t Have to Fear as Many Surprise Medical Bills Come January,” Dec. 28, 2021

Congress.gov, H.R.133 – Consolidated Appropriations Act, 2021, 116th Congress (2019-20)

E-mail interview with Karen Pollitz, a senior fellow for well being reform and personal insurance coverage at KFF, Feb. 11, 2022

KFF, No Surprises Act Implementation: What to Expect in 2022, Dec. 10, 2021

KFF, Ground Ambulance Rides and Potential for Surprise Billing, June 24, 2021

NPR, “Here’s What the New Ban on Surprise Medical Billing Means for You,” Dec. 30, 2021

Telephone interview with Loren Adler, affiliate director of the USC-Brookings Schaeffer Initiative for Well being Coverage, Feb. 14, 2022

Telephone interview with Benedic Ippolito, a senior fellow and knowledgeable in well being care on the American Enterprise Institute, Feb. 11, 2022

Telephone interview with Matthew Fiedler, a fellow with the USC-Brookings Schaeffer Initiative for Well being Coverage on Feb. 11, 2022

The White Home, Remarks by President Biden on the Biden-⁠Harris Administration’s Work to Lower Healthcare Costs, Feb. 10, 2022

Victoria Knight: [email protected], @victoriaregisk