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Hospital Associations Urge Congress Reject Rate Setting

May 31, 2019

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PRESS CONTACTS
Allyson Perleoni, Senior Legislative Analyst

The AAMC, along with five other national hospital associations, May 28 sent a letter to Energy and Commerce Committee Chair Frank Pallone (D-N.J.) and Ranking Member Greg Walden (R-Ore.) urging them to reject statutory rate setting as a way to address surprise medical bills.

Pallone and Walden released the “No Surprises Act” earlier this month [see Washington Highlights, May 17], and solicited feedback on the draft from stakeholders. The legislation would, among other things, prohibit surprise medical bills and hold patients harmless, and would also resolve payment disputes by establishing a pricing benchmark based on the median contracted rate for the service in the geographic area where the service was delivered.

The hospital stakeholder letter states, “We oppose the setting of payment rate in statute and would ask that you consider an independent dispute resolution process.” The groups expressed concerns that “the rate-setting provision of the legislation is a plan-determined, non-transparent process that will upend private payment negotiation…. become the payment ceiling and remove incentives for insurers to develop comprehensive networks.”

Additionally, the letter urges Congress to consider establishing a dispute resolution process “such as arbitration or mediation” as a backstop after “a period of direction negotiation between payers and providers.” The letter references the successes of the New York state law that has reduced the incidence of out-of-network billing and incentivized network participation.

The letter concludes by reiterating the principles for surprise billing that the associations proposed in a February letter to Congress [see Washington Highlights, February 21].

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