American Society of Plastic Surgeons
For Medical Professionals

American Society of Plastic Surgeons Opposes Surprise Billing Provisions in Lower Health Care Costs Act
The proposed law unfairly advantages insurance companies, exacerbates expensive consolidation, and creates an unrealistic independent dispute resolution (IDR) process.

ARLINGTON HEIGHTS, IL – The American Society of Plastic Surgeons (ASPS) strongly opposes the surprise billing provisions within the Lower Health Care Costs Act agreement announced yesterday by Senator Lamar Alexander (R-TN), Representative Frank Pallone (D-NJ), and Representative Greg Walden (R-OR). While ASPS supports efforts to address patients' financial responsibility for unanticipated out-of-network charges, the plan released yesterday falls far short of what physicians and patients need to resolve unanticipated out-of-network billing.

The proposal is based on legislation in California that uses government rate-setting as a solution for surprise medical billing. This removes any incentives for insurers to negotiate in good faith and incentivize even narrower networks. This government-set rate becomes the maximum amount that an insurer will ever pay. In California, RAND Corporation reported that long-standing contracts were terminated by health plans after passage of the law, restricting access for patients. Four large health plans closed their networks to new physicians. Patient complaints about accessing care increased 48 percent in California since the law's enactment.

The legislation is a gift to the for-profit insurance industry. The current bill unreasonably requires physicians accept the median in-network rates that are unilaterally-controlled by the insurance companies. It does not make sense, and is frankly one-sided, to set rates based on whatever the insurers want to pay. Rather than allowing insurers to dictate rates without appeal or negotiation, Congress must pass payment policy that reimburses physicians at fair and transparent rates. The current proposal fails to do that and estimates by the Congressional Budget Office show that it will have the severe consequence of driving down physician contracted payments by as much as 20%, exacerbating expensive consolidation.

Further, the bill creates an unrealistic independent dispute resolution (IDR) process that incorporates a threshold of $750 that must be met before IDR can be initiated. Many physician charges do not exceed $750, so the real-world impact of the measure would require physicians to accept the median in-network rate for any charge below the threshold. The IDR structure without a threshold and including independent third-party databases that is modeled in New York works. The threshold is not needed and further allows insurers to pay unfairly without consequences.

"This is a clear case of Congress picking winners and losers, and in this case the winners are insurance companies. This gift to the insurers siphons off money away from the health care system while decreasing access and increasing costs through consolidation," said Lynn Jeffers, MD, MBA, FACS, president of the American Society of Plastic Surgeons. "Congress should model legislation on what has already worked in the real world. State models such as in New York, which do not rely on government rate-setting have proven successful in ending surprise billing, increasing access to care, and creating a level playing field between insurance companies and physicians."

"It is incumbent upon Congress to ignore its habitual disposition to 'save money' on the backs of physicians and our patients, and rather enact a comprehensive solution that is not catered predominantly to the insurance industry's wish list," continued Dr. Jeffers. "We urge Congress take the time to do this right, heed real-world examples, and not rush into a compromise that will have lasting undesirable consequences."


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