A new report from the U.S. Department of Health and Human Services provides the strongest call yet for Congress to finally take action on surprise medical bills, calling the practice “a market failure that will not correct itself.” Today, millions of patients are still at risk of a surprise medical bill from a private equity firm or out-of-network provider as Congress continues to stall on vital patient protection reforms. As the report notes, these private equity firms continue to have the upper hand when it comes to taking advantage of the market at the expense of patients.

Highlights from the report are included below:

  • “The [surprise medical billing] problem is well understood. There is bipartisan support that patients should not be subject to surprise medical bills and senior Committee Chairs have expressed that they are committed to addressing this problem. We strongly encourage Congress to enact legislation to protect patients from surprise bills.”
  • “Surprise medical billing is a widespread and costly problem in the U.S…In these situations, patients are not able to engage in informed decision-making and lack basic consumer protections, such as transparent pricing, which would normally protect patients from receiving excessively high surprise bills.”
  • “Given the added potential risk that patients will be treated by providers outside of their network during the Coronavirus Disease 2019 (COVID-19) public health emergency, the Administration took the initiative within its current authority to implement temporary restrictions on the ability of providers receiving certain assistance from the Provider Relief Fund to surprise bill patients.”
  • “However, Congress needs to enact a permanent and comprehensive solution to protect patients from surprise billing. Sound surprise billing legislation will not only protect patients but will also encourage a fairer, patient-centered healthcare system.”
  • “Hospitals are increasingly relying on third party staffing firms to meet their needs for personnel, which is contributing to surprise billing. These private staffing firms are often used to staff emergency rooms and to provide specialty care in areas such as anesthesiology, gastroenterology, urology, and orthopedics. Private equity plays a large role in third party staffing: the two largest physician staffing firms, Envision/EmCare and TeamHealth, are each owned by private equity firms. Research shows that when private equity firms enter a market the rate of out-of-network billing increases by large percentages: 66 percent for Envision/EmCare and 13 percent for TeamHealth.”
  • “The importance of private equity staffing firms to the surprise billing landscape is illustrated by the lobbying campaign waged by Doctor Patient Unity, a coalition of doctors’ groups owned by private equity firms and funded by Envision/EmCare and TeamHealth. As of May 2020, Doctor Patient Unity has spent approximately $58 million on television and radio commercials and nearly $1 million on Facebook ads since last summer in order to influence the surprise billing debate, according to ad tracker Kantar/CMAG.”
  • “The COVID-19 pandemic underscores the urgency of addressing the issue and illustrates that action on surprise billing is possible…It is imperative for Congress to build on the [Administration’s] achievements and permanently remove the threat surprise billing poses for millions of American patients.”

To view the full analysis, click here.