New legislation clamps down on surprise medical bills

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• Judy Woodruff:

  The major bills passed by Congress were focused first and foremost on COVID relief and economic assistance. But they included other significant pieces of legislation, some years in the making.

  One of those is a bipartisan compromise to ban many of the surprise medical bills people receive.

  It doesn't take effect for another full year, until 2022. But it makes some important changes.

  William is back with the details on what people need to know.

• William Brangham:

  Judy, these surprise bills occur when a patient goes to a hospital or an emergency room believing that their insurance will cover their treatment.

  But, in that facility, if they get care from an out-of-network doctor or other provider who doesn't accept that insurance, that's when patients can get saddled with significant bills. Studies show one in every five emergency room visits leads to a surprise bill. And they can cost hundreds or thousands of dollars, money that most people cannot afford.

  The new law that was passed yesterday aims to end these practices.

  And joining me now is Sarah Kliff of The New York Times. She has long been spotlighting this problem.

  Sarah, great to have you back on the "NewsHour."

  Help us understand, what did this new bill ban? What does it block.

• Sarah Kliff:

  So, this means, if you are unexpectedly treated by someone who isn't in your insurance network — maybe you go to the emergency room and your doctor doesn't accept your — their insurance — they cannot bill you anything beyond your standard co-pay or deductible.

  Essentially, the insurance company and the doctor have to sort things out on their own. This takes the patient out of the middle of these negotiations and says, you cannot bill the patient any more than you would if it was an in-network provider.

• William Brangham:

  So, in this bill, once these changes take place, what happens?

  If I go to a hospital and end up with a surprise bill because a provider who I thought was in network is not, and they perform some procedure on me, there generates this big bill, then who ends up paying? What happens there?

• Sarah Kliff:

  So, what is going to happen, that's right. You cannot get saddled with that big bill anymore.

  What's going to happen is, the insurance company and the doctor are going to figure out a fair price. Now, in these cases, if they're not in network, that means there's been some kind of dispute. They don't agree on the right price for the service.

  Under the new law, they're going to have the opportunity to go to an impartial arbiter, who they're both going to make their case for, here's why I think that this is the right price. And then the arbiter is going to look at kind of the typical prices for the service. And they're going to make a decision about what that person should get paid.

  So, essentially, the patient is not on the hook. The insurance company and the doctor need to work with this neutral arbiter to figure out the right price.

• William Brangham:

  Help me understand the ambulance discrepancy in this bill. An air ambulance, when you're taking via helicopter, that doesn't — this bill blocks you from being saddled with a surprise bill for that.

  But for ground ambulances, which are not quite as expensive, but still very pricey, those are not covered. Why is that?

• Sarah Kliff:

  Yes, this was a pretty significant omission on the part of Congress, because we know that ground ambulances generate a pretty significant number of surprise bills.

  By one estimate, 71 percent of ambulance rides are out of network. When we talked to legislators about this, they said they are concerned about the issue. They do think it's important to solve this ground ambulance part of the surprise billing. They just did not feel that they had the capacity to do it in this legislative go-around.

  They were under a lot of lobbying pressure from doctors and hospitals trying to find the solution that works for everyone. So, they said that ground ambulances are going to have to wait for some future legislation in order to deal with that particular surprise billing issue.

• William Brangham:

  For people who don't know how severe a financial hit this can be for an individual, can you just give us one vignette from your long reporting about what these bills can do to someone?

• Sarah Kliff:

  Yes, the one that really jumps out at me from this summer was a woman who was very ill with coronavirus, and she was airlifted from one hospital to another one because she needed more extensive and intensive care.

  The patient was on a ventilator. She was unconscious. The first hospital was in network. The second hospital was in network. But that air ambulance was out of network. And she ended up with a $52,000 bill for that flight between hospitals that lasted about 20 minutes.

  This is really your classic surprise medical bill. The patient has literally no say in the services that are being provided. They're unconscious when they're being provided to her. And, before now, there were no protections. It was completely legal for this air ambulance company to send this woman a $52,000 bill.

  Once these rules go into effect in 2022, that type of billing just is not going to be legal anymore.

• William Brangham:

  That is an amazingly big bill.

  You have also reported that this isn't just a consequence, these bills are not just a consequence of our Byzantine medical system, but that they in some ways were engineered on purpose to make a profit.

  Who was doing that?

• Sarah Kliff:

  So, so these were some private equity firms who kind of realized there was an opportunity to profit off of this type of billing.

  And what we saw happening just a few years ago was, private equity firms would buy up doctor staffing groups, these doctors who staff emergency rooms, and they would pull them out of network. And all of a sudden, the rates would just shoot up.

  So, we saw that this wasn't just a mistake or one insurance company, one doctor not coming to an agreement. In some cases, these were private equity-created models for how to drive profits back to those folks, but also it was on the backs of the patients who are paying these bills.

• William Brangham:

  All right, Sarah Kliff of The New York Times, thanks for helping us understand all of this.

• Sarah Kliff:

  Thanks for having me.