The No Surprises Act protects patients from unexpected out-of-network (OON) medical bills, but a growing industry of profit-seeking middlemen is exploiting loopholes in the system—driving up costs and threatening patient access to care, according to new research published by Third Way.
At the center of this issue are Revenue Cycle Managers (RCMs), third-party firms that hospitals and health systems hire to handle financial and administrative services, including coding, claims management, debt collection, insurance verification and network negotiation. But their influence extends beyond backend support. Many RCMs act as aggressive negotiators and strategists, steering providers toward revenue-generating actions that undermine the No Surprises Act’s protection of families, patients, employers and health plans. The industry is expanding rapidly, growing to $170 billion in 2024 and projected to reach $308 billion by 2030.
Below are key insights from Third Way. To read more, click here.
- “Hospitals are rewarded by out-of-network threats. Revenue cycle managers increasingly advise hospitals to leave insurance networks or threaten to do so as a negotiation tactic. In practice, that would mean a hospital system stops treating patients who have a specific insurance. This tactic often leads to large increases in reimbursement rates, especially when the hospital system dominates local markets.”
- “The surprise billing process is being gamed. To end surprise medical billing, Congress passed the No Surprises Act and created the “independent dispute resolution” process. However, this process is anything but independent, with providers winning 77% of cases.”
- “Some revenue cycle managers specialize in disputes for surprise medical bills. When providers win, they receive triple the in-network price for services, meaning patients pay more in premiums and out-of-pocket costs…These high payment levels further incentivize revenue cycle managers to encourage providers to go out of network, as it is in their interest to do so.”
To preserve the No Surprises Act’s original goal, and to protect employers, patients and families from certain providers some in the hospital industry increasing prices and harming access to care, the Trump administration and Congress must implement common-sense reforms to address current flaws with the process, including:
- Preventing ineligible claims—including Medicare, Medicaid, state-arbitration claims, in-network claims, untimely claims, incorrectly batched claims and claims that have already been through arbitration—from being entered into the arbitration portal and prohibit IDR entities (IDRE) from issuing payment determinations on ineligible claims and disputes initiated with incomplete or inaccurate information;
- Establishing timely processes for correcting or addressing errors on non-eligible claims and a formal process to reject payment determinations for non-eligible claims;
- Encouraging IDRE performance audits and holding initiating parties accountable where there is a demonstrated pattern of making false or misleading representations in the IDR process;
- Requiring enhanced training and oversight of IDREs on the No Surprises Act statute and guidance to ensure compliance and mitigate instances of abuse or misuse; and
- Mandating timely and transparent disclosures on IDR utilization by individual providers, as well as transparency on IDREs’ performance to ensure objective decision-making.
Why this matters: RCMs represent a new front in the fight against health care pricing abuse. Their strategies prioritize volume over value and revenue over patient care. Without urgent reforms, the system designed to protect Americans from surprise medical bills will instead be weaponized against them.
For more information on the No Surprises Act, visit stopsurprisebillingnow.com.
Recent Comments