CBO: Fix backed by doctors for surprise medical bills would cost billions

A Congressional Budget Office (CBO) analysis finds that a rival approach backed by doctors groups for protecting patients from getting massive “surprise” medical bills would increase the deficit by “double digit billions” of dollars. 

The email from the nonpartisan CBO to a congressional office, obtained by The Hill, comes amid a raging debate over legislation to stop surprise medical bills, which is seen as a rare area of possible bipartisan accomplishment this year. 

{mosads}Powerful doctor and hospital groups are lobbying hard against the leading legislation, warning it would lead to damaging cuts to their payments. 

But the newly obtained analysis from the CBO shows that the rival approach favored by the doctors and hospitals would carry a hefty price tag, in contrast to the leading approach, which saves the government billions. 

The CBO analysis could put a dent in doctors’ and hospitals’ efforts as they fight the surprise billing legislation. 

The CBO looked at an approach that is featured in a bill from Reps. Raul Ruiz (D-Calif.) and Phil Roe (R-Tenn.), and backed by doctors, finding it would cost “double digit billions” of dollars over 10 years. 

In contrast, the approach used in bipartisan bills that have passed out of the House Energy and Commerce Committee and the Senate Health Committee would both save more than $20 billion over 10 years, the CBO has found. 

The key difference between the approaches is in deciding how much the insurer will pay the doctor once the patient is protected. 

The House Energy and Commerce and Senate Health committee bills essentially set the payment rate that insurers will pay doctors — based off of the median of the rates insurers have negotiated with doctors in that area. 

In contrast, the Roe-Ruiz bill would give the decision to an outside arbitrator to decide the payment amount and instruct the arbitrator to consider the amount that doctors charge before any negotiation with insurers takes place, a much higher amount. 

The CBO finds this Roe-Ruiz approach would drive up costs. The agency said that a similar approach in effect in New York state had increased payments to doctors “as much as 5 percent in response to the policy.”

“If payments to providers increased by 5 percent as the result of the policy, that change alone would result in a $15 billion increase in the deficit over 10 years,” the CBO wrote. 

Roe contested the CBO’s conclusions in a statement to The Hill, saying premiums in New York have “actually fallen.”

“My biggest concern is we will enact a bad policy that makes the practice of medicine more difficult and more complex based on a score that is likely to be wrong because of how much it conflicts with real world practices,” Roe said. “I’m far more interested in enacting good policy that makes health care more patient centered than enacting a bad policy just because CBO estimates it will save more money.” 

The path forward on which approach will win out remains unclear. The House Education and Labor Committee, which is also working on a bill, delayed a planned vote last week as some lawmakers push for the approach favored by doctors. There is still no agreement.