Chairman Alexander, Ranking Member Murray and Members of the Senate Health, Education, Labor and Pensions Committee:
We are writing in response to the call for feedback on the draft “Lower Health Care Costs Act of 2019.” Thank you for the opportunity to comment.
Title I: Ending Surprise Medical Bills
We agree that patients should not be the financial victims of an insurance plan’s flawed protocols regarding out-of-network services. However, Title I misses the mark. Instead of seeking to fix the policy missteps leading to insurers failing to cover needed care, the proposal imposes one-size-fits-all restrictions on the ability of patients to seek procedure-based care from out-of-network physicians.
At an absolute minimum, Title I should contain language that expressly allows patients and physicians to work together on mutually agreeable terms, irrespective of the patient’s coverage or an insurer’s agreements with a facility or others.
We also object to the following provisions in Section 103 of Title I that give improper leverage to health plans to control the care provided to their enrollees by out-of-network physicians:
- “Sec. 2729(a)(1)(A) each health care practitioner who provides services in the facility will be under contract as a participating health care practitioner with respect to the plan;
- “Sec. 2729(a)(1)(B) all laboratory or diagnostic services … are referred only to providers included in the network contract [even though cash diagnostic prices out-of-network are often lower];
- “Sec. 2729(d) In the case of a healthcare practitioner who does not establish a network contract with a group health plan or health insurance issuer that has a network contract with a facility in which the practitioner provides services, as described in subsection (a), the group health plan or health insurance issuer shall not reimburse the health care practitioner for any services provided to enrollees in the plan or coverage.’’
Title II: Reducing the Prices of Prescription Drugs
We are generally supportive of the measures inTitle II. We are disappointed not to find any provisions implementing our suggestion to the Committee regarding off-label uses of drugs and devices. The Food and Drug Administration’s restrictions on such free speech prevent patients and physicians from learning about potentially life-saving uses of items within its regulatory sphere. The federal bureaucracy should not try to pick winners and losers in the free market, including the medical market.
Title III: Improving Transparency in Health Care
The provisions in Title III are also generally steps in the right direction. We thank the committee for Section 301 that implements our suggestion regarding ending gag clauses that block transparency. We have concerns that provisions in Section 302, intended to prohibit “anti-tiering” and “anti-steering” clauses, could be used to limit patient choice. Preserving patient options is especially important in an environment where those providing the care are increasingly employed by the plan. Steering patients to plan-owned facilities run by employees of the plan (often non-physicians), and away from independent options, may not be protective of patients’ interests.
Section 304 appears to improperly punish physicians for insurance company mistakes. It is unjust to require a physician to refund fees, and be subject to monetary penalties, when a plan mistakenly lists a physician as “in-network.” The insurer should be the responsible party in these cases, not doctors who have no control over how they appear in an insurance company directory.
Likewise, Section 305 seems overly punitive. Physicians should not be required to provide care for free, simply because a bill is not sent within 30 days. The provision of a bill to the patient can be delayed due to insurance company red tape outside of the physician’s control.
Section 306 provides welcomed increased transparency of Pharmacy Benefits Managers (PBMs). We note that there is no requirement that patients may see disclosures related to net pricing on drugs they are paying for. We also question the proposal that manufacturer rebates are required to be passed on to the plan. There is no guarantee that any savings will be passed along to enrollees in the form of decreased premiums or otherwise. In addition to PBMs, we urge the Senate HELP Committee to explore options to decrease the impact Group Purchasing Organizations are having on increased prices for drugs, supplies, and devices.
Sections 307 and 308 require long overdue investigations into where money is flowing in American medicine. However, the provisions in these sections may neglect some of the largest sinks of money diverted from medical care. Entities like Medicaid Managed Care Organizations and Medicare Advantage plans, Medicare Administrative Contractors, and Group Purchasing Organizations also deserve scrutiny.
Section 309 may ask medical professionals to know the unknowable: “the expected enrollee cost-sharing for the provision of a particular health care service.” The health plan sets that price. The patient may be responsible for a co-pay of either a set amount or a percentage of the provider’s fee. There is no way for providers to know the patient’s co-pay until they know what they will be paid — which is a mystery until the reimbursement check arrives. Providing enrollees of health plans with this information should be the responsibility of the plan.
Title IV: Improving Public Health
The provisions in Title IV, in our view, place too much emphasis on a federal role in solving public health problems that are better addressed at local and individual patient levels. The needs and social constructs vary widely in each state and federal intervention can be counterproductive. Increasing the government’s role in these areas should be approached with caution.
Title V: Improving the Exchange of Health Information
Title V requires insurers to provide electronic access to patients of their claims history and cost-sharing estimates. We agree that insurers should do this. The fact that this is not currently standard indicates that there are more fundamental structural problems in medical financing.
Thanks to decades of policy missteps and subsequent “fixes,” mandating transparency may not turn out to be the panacea some expect without restoring market mechanisms that facilitate competition. In our letter to the Committee earlier this year we suggested some ways to begin rolling back policy failures that increase costs and thwart competition:
- Barriers to increased access to
- Certificate of Need laws should be eliminated.
- the prohibition on the expansion of physician-owned hospital in the Affordable Care Act should be removed.
- Regulations on insurance such as the “minimum essential benefits” in the Affordable Care Act need to be struck down permanently.
- Limitations on how patients spend their own Health Savings Account dollars on care should be lifted, e.g. HSAs should be compatible with free market Direct Primary Care arrangements.
In conclusion, the federal government has no constitutional authority to interfere in the health insurance market, and has only shown that massive bureaucracy serves to increase costs and keep the inner workings of our “healthcare system” opaque. We ask that the HELP Committee keep this admonition in mind as it moves forward. Further interference can be expected to bring more of the same: high prices and limited choice. On the other hand, legislation that facilitates competition by removing barriers and unconstitutional policies, will lower costs, increase options, and benefit patients.