This summer my husband, who suffers from the chronic disease of ankylosing spondylitis, was hospitalized after an episode of syncope while he was at work.  He was brought to a hospital that is in network with our insurance company.  However, in the months that followed we received bills from several of the physicians and other providers that treated him during his three-day stay.  These bills were hundreds of dollars each.  This was our first foray into the land of surprise medical billing.  However we were lucky he was hospitalized in New Jersey: we had a piece of legislation on our side- New Jersey’s Out-of-Network Consumer Protection, Transparency, Cost Containment and Accountability Act, signed into law by Governor Murphy in 2018.

Many Americans, including those with health insurance, are just one health crisis away from economic disaster.  A significant portion of the economic insecurity is driven by a health practice called “surprise medical billing.”  Surprise medical bills are the financial charges that insured patients receive when they inadvertently receive care from an out-of-network provider.  Many times, surprise bills arrive after an emergency when a patient is taken to a hospital and has no ability to select the physicians or ambulance providers. Surprise bills can also arise when a patient receives planned care from a provider at a hospital or surgery center.  While the hospital and the treating physicians are in-network, other providers may not be.  In either case, the surprise bills can mount to thousands of dollars for which the patient is often responsible. A Kaiser Foundation survey found that amongst non-elderly adults struggling with medical debt, surprise bills were a contributing factor a third of the time. Further these unexpected medical bills are a major economic worry for Americans, with two-thirds saying they are “very worried” or “somewhat worried” that they or a family member will receive a surprise bill.

Currently 25 states have laws offering some protection to their residents from surprise bills.  And New Jersey’s is amongst the most comprehensive in the nation.  The law requires greater disclosure from providers and insurance companies to patients about what is and is not covered; ensures that patients are not responsible for excess costs and establishes an arbitration process to resolve payment disputes.  However, a year after the law passed, my husband was getting surprise bills in the mail from his hospital stay.  Working with our insurance company, and aware that our state has surprise bill protections, we were able have the bills settled.  However, I shudder to think of the economic impact to us if Governor Murphy had not passed the law, or if we did not know that surprise bills were outlawed in the state.  It was concerning to me that a year after the law passed, physician billing services would continue to send a bill to the patient, instead of working directly with the insurance company to receive the in-network rate.  Getting medical bills in the mail is often a daunting experience.  Being unaware of the law against surprise billing, many patients would accrue the debt from these bills as they struggle to pay them.

This concern is further amplified by recent research by Eileen Appelbaum at the Center for Economic and Policy Research in Washington DC.  Her groundbreaking research has found that private equity firms have bought up specialty physician practices and emergency ambulance/air transport services.  Private equity firms buy out doctors’ practices and roll them into large corporate physician staffing firms that gain greater market power and provide outsourced services to hospitals. The new private equity–owned companies sidestep state laws that prohibit nonmedical ownership of doctors’ practices by setting up “physician management” of the medial decisions but the doctors give up control over other management practices, such as the company’s billing practices. And as hospitals have increasingly turned to outsourcing expensive and critical services to third-party providers as a cost-reduction strategy, this has led to a growth in surprise bills for patients.  So the physicians who treated my husband at the hospital may have been unaware that he was getting surprise bills in the mail.

New Jersey Congressman Frank Pallone has introduced legislation in the House of Representatives, with bi-partisan support, which restricts how high an out-of-network doctor’s fee can go, restrains the growth of health care costs, and limits payouts that insurers can be made to pay.  And the Senate has its own legislation moving forward. However as Eileen Appelbaum wrote in Sunday’s Star Ledger, two of the largest physician staffing firms – Envision and TeamHealth–have spent millions on ads to try to prevent any legislation from passing.

States like New Jersey have taken critical steps to address surprise billing, and Congressman Pallone’s legislation can help extend these protections nationally.  And as ending surprise bills become the law of the land, equally critical is awareness to residents that such protections are in place, so that when surprise bills come to a patent’s mailbox, they know their rights. Without protections and awareness far too many individuals will face mounting surprise bills in the most vulnerable moments of their lives.