A bill that prevents patients from being surprised with out-of-network costs will take effect on Jan. 1, decreasing the price of millions of medical bills.
Under a rule issued by the Biden administration in July after former President Donald Trump signed the measure into law in January, the No Surprises Act ensures that people with private insurance aren't hit with out-of-network bills for emergency services or procedures outsourced by an in-network doctor or facility. If they voluntarily choose to go out of their network, they are still responsible for the increased costs.
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"No patient should forgo care for fear of surprise billing," said Health and Human Services Secretary Xavier Becerra in July. "Health insurance should offer patients peace of mind that they won't be saddled with unexpected costs."
Though the bill enjoyed bipartisan support when it was approved by Congress in December 2020, its passage was contentious due to outcry from both insurance agencies and healthcare providers. Several medical groups have filed a lawsuit against the bill, seeking declaratory and injunctive relief from the U.S. District Court for the District of Columbia in arguing the Biden administration's implementation unfairly benefits insurance providers.
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As it stands now, the remaining payment for out-of-network costs is decided by negotiation between the insurance providers and the healthcare providers. The insurance companies wanted the cost to be decided by median in-network service prices in the region where they were provided, which must factor into the negotiations under the current rule more than hospitals would like.
"Our legal challenge urges regulators to ensure there is a fair and meaningful process to resolve disputes between health care providers and insurance companies," Gerald Harmon, president of the American Medical Association, one of the medical groups suing, said. "But if regulators don't follow the letter of the law, patient access to care could be jeopardized as ongoing health plan manipulation creates an unsustainable situation for physicians."