WASHINGTON, DC – Energy and Commerce Committee Republican Leader Greg Walden (R-OR), Chairman Frank Pallone, Jr. (D-NJ), and Senate Health Education Labor and Pensions (HELP) Chairman Lamar Alexander (R-TN) and Ranking Member Patty Murray (D-WA) today expanded a bipartisan investigation into surprise billing practices of physician staffing companies and top insurers. In letters to Envision Healthcare, TeamHealth, Anthem, Cigna, CVS Health, Health Care Service Corporation, Highmark, and UnitedHealth Group, the bipartisan, bicameral leaders requested information and documents pertaining to the billing policies and practices of physician staffing companies and insurers when a patient receives care from an out-of-network provider at an in-network facility, which far too often results in a surprise medical bill.
“Over the past year, the Committee has taken several bipartisan steps to hold patients harmless in situations where they, through no fault of their own, receive a surprise bill from an out-of-network health care provider,” Walden, Pallone, Alexander, and Murray write in the letters. “We are concerned about the impact of surprise billing on the nation’s rising health care costs and the devastating effect that the practice is having on Americans. Therefore, we request your assistance to understand better why surprise billing occurs, the policies and practices that help protect individuals from surprise billing, and the current incentives behind the negotiations between providers and insurers.”
Research from experts at the American Enterprise Institute and the Brookings Institution, referenced in the letters, shows that surprise bills are frequently associated with services provided by an out-of-network emergency physician or ancillary clinician – such as a radiologist, anesthesiologist, pathologist, hospitalist, or assistant consulting surgeon – at an in-network health facility.
Many of the services that are often associated with surprise bills are also areas where hospitals have increasingly outsourced patient care. This occurs because physician staffing companies and hospitals independently negotiate contracts with insurers—at times, a hospital may have negotiated rates with major health insurers while the physicians associated with the physician staffing company are not part of those networks.
A study by researchers at Yale found that hospitals that contract with physician staffing companies have higher rates of out-of-network billing. Evidence indicates that physician staffing firms charge significantly higher in-network rates than their counterparts, thereby driving reimbursement upwards as they enter into staffing arrangements with hospitals. Physician staffing companies have argued that some insurance companies have refused to negotiate reasonable reimbursement rates with providers, increasing the likelihood that providers will be out-of-network and balance bill patients.
In the letters to physician staffing companies, the leaders press the companies for answers as to the policies and practices when a provider is not in-network with a patient’s insurance company, including the policies as they relate to sending surprise bills, and the relationship with certain private equity firms.
In the letters to insurers, the leaders press the companies for answers as to the negotiating of reimbursement rates with physician staffing companies and how insurers protect enrollees from receiving unanticipated bills from an out-of-network physician at an in-network facility.
The investigation builds on the bipartisan investigation Reps. Pallone and Walden launched in September into practices of private equity firms surrounding surprise billing. In letters to KKR & Co. Inc., Blackstone Group, and Welsh, Carson, Anderson, & Stowe, Pallone and Walden requested information and documents pertaining to the firms’ ownership of physician staffing and emergency transportation companies. That investigation is ongoing.
To read the letters, click here.