Oct 25, 2019

New York's very expensive surprise medical billing solution

New York's surprise billing law — which providers hope will become the model for a national solution — has resulted in providers receiving some very high payments, according to a new analysis by the USC-Brookings Schaeffer Initiative for Health Policy.

Why it matters: Surprise medical bills impact two groups of people: The patients directly responsible for paying them, and the rest of us, who pay higher premiums as a result of their existence.

  • A solution resulting in higher provider reimbursements would still protect patients from enormous surprise bills, but it could raise health care costs and thus premiums.

Details: New York's law resolves payment disputes between insurers and providers — the heart of the surprise billing debate — by using an arbitration process.

  • State guidance says that arbiters should consider the 80th percentile of billed charges, or list prices. The problem is that these charges tend to be much higher than the negotiated rates that insurers pay for in-network care.
  • A New York Department of Financial Services report found that the average payment amount decided through arbitration is 8% higher than the 80th percentile of charges — a victory for providers.
  • This, in turn, is likely to raise physicians' leverage with insurers when negotiating payment rates.

Yes, but: The state's report says the law has saved consumers an estimated $400 million, "but there is no supporting evidence provided and the actual data released in the report strongly suggests that the opposite is true," the USC-Brookings analysis argues.

Go deeper: Hospitals' dog in the surprise billing fight

Go deeper

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Updated 1 hour ago - Politics & Policy

U.S. coronavirus updates

Data: The Center for Systems Science and Engineering at Johns Hopkins; Map: Andrew Witherspoon/Axios. This graphic includes "probable deaths" that New York City began reporting on April 14.

The CDC is warning of potentially "aggressive rodent behavior" amid a rise in reports of rat activity in several areas, as the animals search further for food while Americans stay home more during the coronavirus pandemic.

By the numbers: More than 97,700 people have died from COVID-19 and over 1.6 million have tested positive in the U.S. Over 366,700 Americans have recovered and more than 14.1 million tests have been conducted.

World coronavirus updates

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Japan's economy minister outlined plans on Monday to end the nationwide state of emergency as the number of new novel coronavirus cases continues to decline to fewer than 50 a day, per Bloomberg. Japan has reported 16,550 cases and 820 deaths.

By the numbers: Over 5.4 million people have tested positive for the virus as of Monday, and more than 2.1 million have recovered. The U.S. has reported the most cases in the world (over 1.6 million from 13.7 million tests). The U.K. is reporting over 36,800 deaths from the coronavirus — the most fatalities outside the U.S.