By Doug Badger and Brian Blase
Surprise medical bills are a source of frustration for many Americans. There are several circumstances in which patients are exposed to such “surprises.” The first occurs when people receive treatment at a network facility and subsequently receive a balance bill for treatment in that facility from a non-network provider. A second occurs when
people receive a large bill after receiving scheduled treatment without having been provided an estimate before they received the care.
In this essay, we lay out a truth-in-advertising requirement to address the first surprise and a good faith price estimate in advance of receiving scheduled care to address the second surprise.
Truth-in-advertising protections combined with a good faith estimate requirement leaves one scenario in which patients need protection from surprise medical bills—emergency services at out-of-network facilities. Patients should be protected from balance billing in this situation, and Congress should apply existing federal regulations to
determine the rate that insurers compensate providers.
Congress should not enact an arbitration model, which has a host of problems, including imposing contractual terms on parties that have not entered into a contract. It should reserve rate-setting to the circumstance in which a patient receives emergency care at a non-network hospital. In sum, we propose that government protect patients from surprise bills primarily by preventing insurers and providers from giving false and misleading information to consumers and by requiring that consumers be informed of prices before they receive scheduled care.