A new Commonwealth Fund study found that most states don’t have laws that protect consumers from balance billing for out-of-network care delivered in emergency departments (EDs) or in-network hospitals.
Only six states provide a “comprehensive approach to protect consumers in these situations,” but even those laws have loopholes. Another 15 states provide some protection against these surprise medical bills, but there are gaps.
There are no explicit federal protections against the practice of balance billing by payers.
Consumers are frequently confused by the healthcare system, particularly when it comes to paying for care. Individuals know to stay in-network, but sometimes — such as in emergency situations — they have no choice but to go outside the network.
“When consumers feel very ill or experience a medical emergency, they usually do not have the time or presence of mind to determine whether a provider who treats them is out of network. Even if they know, they often have no opportunity to choose a network provider,” said study authors Kevin Lucia, Jack Hoadley and Ashley Williams, all of Georgetown University.
They often get an unexpected balance bill for what their insurer didn't cover. This practice is normal, but study authors say it’s a “costly and confusing practice.” It can also undermine narrow network plans and discourage competition among providers in those plans.
The issue is getting worse as provider networks narrow. The study found that 14% of ED visits and 9% of hospital stays were likely to produce a surprise bill. Patients who were admitted to the hospital via the ED were more likely (20%) to receive a surprise bill.
Despite frequent efforts at healthcare reform, Congress hasn't tackled the issue of surprise medical bills. There are some protections in place for providers, such as requiring that payers must pay non-network providers the “normal amount it would pay in network” in emergency care situations, but there aren't actual federal laws that protect consumers.
The study found that only California, Connecticut, Florida, Illinois, Maryland and New York provide adequate protection, but there are even holes in those laws. They pointed to Maryland and New York as examples for other states to follow. Those two states created laws that “shield consumers from unexpected and burdensome balance billing charges while facilitating a process for insurers and providers to determine acceptable payment levels."
The study authors suggest that as Congress continues to argue repeal of the Affordable Care Act, consumer protections are more likely to come from states and “a federal policy solution might prove difficult.”