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Out-of-network billing and “surprise bills” increasingly common in in-network hospitals
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Out-of-network billing has substantially increased among privately insured patients for both inpatient and ED visits, even when they go to in-network hospitals, according to study results published in JAMA Internal Medicine.
The findings suggest that legislation is needed to reduce the number of “surprise bills” and the costs to each patient, according to the study authors.
“In theory, out-of-network billing could benefit patients by providing flexibility for them to see out-of-network physicians,” Eric C. Sun, MD, PhD, of the department of anesthesiology, pain, and perioperative medicine and the department of health research and policy at Stanford University School of Medicine, and colleagues wrote. “Such flexibility would require the patient to be aware in advance that the physician is out-of-network and may send a balance bill. More commonly, however, the patient is unaware of these possibilities.”
“Even if the hospital and the admitting physician are in-network, the patient could still be cared for by out-of-network physicians and be sent balance bills,” they continued.
Researchers conducted a retrospective analysis using data from a national database of health insurance claims from people with private insurance in large commercial insurers. They reviewed data from all inpatient admissions and ED visits at in-network hospitals from Jan. 1, 2010, to Dec. 31, 2019, and identified incidences where in-network patients received out-of-network bills.
A total of 5,457,981 inpatient visits and 13,579,006 ED admissions between 2010 and 2016 were included in the study.
During the study period, the prevalence of ED visits that included an out-of-network bill increased from 32.3% to 42.8% and the mean financial responsibility associated with out-of-network bills increased from $220 to $628.
Inpatient admissions with out-of-network bills increased from 26.3% to 42% during the study period. The mean potential financial responsibility associated with these bills increased from $804 to $2,040.
Sun and colleagues found that out-of-network billing was common among medical transport services and hospital-based physicians who provided care at in-network locations, such as emergency physicians, radiologists and anesthesiologists. As these conditions are often not under a patients’ control, researchers recommended policies that limit the ability of physicians and emergency transport services to send balance bills to patients.
In a viewpoint published with the study, Sarah Kliff, BA, a health care policy journalist and investigative reporter at The New York Times, explained how Congress and state governments can address surprise out-of-network billing through legislature by “setting limits on what clinicians and health care facilities can charge patients in certain situations or establishing an arbitration process to settle surprise medical bills.”
In an editorial accompanying the study, Robert Steinbrook, MD, from the editorial office of JAMA Internal Medicine and the University of California, San Francisco, also called for federal action.
“Federal legislation can end surprise medical bills because it can apply to all health insurance,” Steinbrook wrote. “Legislation should be comprehensive and have the net effect of reducing costs, to patients and to the health system in general. At a minimum, legislation should cover medical transport, emergency care where the patient has little or no choice about where they receive care, and all care at in-network hospitals, emergency departments, and outpatient facilities.” – by Erin Michael
Disclosures: Kliff and Steinbrook report no relevant financial disclosures. Sun reports grants from the National Institute on Drug Abuse during the conduct of the study; personal fees from Mission Lisa Foundation, Egalet, Inc. outside the submitted work.