By Ashley Fuoco Antonelli, Contributing Editor

The debate around so-called "surprise" medical bills came to a meaningful head this week when bipartisan groups in both the House and Senate released draft bills to stop unexpected out-of-network bills.

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The debate has been raging for years (you might recall my own experience receiving a surprise medical bill back in 2016), and for most of that time it focused on ways to improve price transparency. But in recent months, the debate has evolved: Insurers, providers, and policymakers are discussing proposals that actually would change the way insurers pay providers for out-of-network care.

Still, the House's and Senate's new proposals differ in key ways. Let's take a closer look.

What patients want along their financial journey

How health insurers and providers want to solve the issue

At this point in the debate, insurers, providers, policymakers, and patients all agree that surprise billing is a problem, but among insurers and providers, there's almost no agreement in how they want to combat it.

Currently, when a patient receives care from an out-of-network doctor, the patient's insurer in some instances pays what it considers to be a fair price to the out-of-network provider, and the provider might then bill the patient for the remaining cost—a practice known as "balance billing" that can leave patients with sky-high bills.

To address the problem, insurer groups have urged congressional leaders to establish set payment rates for care. The groups said Congress should prohibit physicians from balance-billing patients in cases involving emergency or involuntary care, require provider facilities to inform patients whether providers are in their health plans' networks, and set reimbursement rates based on the market rates insurers pay similar providers in a geographic region or on a share of Medicare reimbursements.

However, provider groups don't want lawmakers to establish payment rates for out-of-network care. Major hospital groups have said allowing the government to establish payment rates could set "a dangerous precedent" and "create unintended consequences for patients by disrupting incentives for health plans to create comprehensive networks."

The American College of Emergency Physicians (ACEP) in February proposed a plan that would require both providers and insurers to make concessions. ACEP said any legislation to address surprise medical bills should bar providers from balance billing, require insures to clearly convey plan details and patients' rights related to emergency care, and establish a "baseball-style arbitration" process that relies on a third party to settle insurer-provider billing disputes.

That kind of arbitration process already is in place in New York, and early research suggests it's successfully protected patients from surprise bills without major disruptions to insurers and providers. But establishing a national arbitration process has been a non-starter for America's Health Insurance Plans. The group in a letter urged Congress to "[a]void the use of complex, costly and opaque arbitration processes that can keep consumers in the middle and lead to higher premiums."

How lawmakers have proposed solving the issue

This week, we got our first glimpse at how lawmakers might try to incorporate insurers' and providers' diverging ideas.

Both the draft House and Senate measures would prohibit balance billing for emergency care—but they diverge on how insurers would pay providers for such care.

How to grow market share with price transparency

The House draft bill would establish a payment rate at the median in-network rate for services in the geographic area where a patient received care. The House draft bill would not establish an arbitration process to handle any payment disputes that arose.

In contrast, the Senate draft bill would require insurers to automatically pay out-of-network providers and hospitals about the same rate as in-network providers, and it would establish an arbitration process for providers and insurers to dispute the payment rate if they chose.

The House draft bill would require providers to give patients with scheduled care a written and oral notice at the time of scheduling about their network status and potential charges the patient could incur. If a patient does not sign a consent form acknowledging they know they are seeing an out-of-network provider, the provider would not be allowed to charge the patient an out-of-network rate.

But the Senate draft bill would place the onus of making prices more transparent on both providers and insurers. The Senate draft bill would require insurers to publish their price information online and list in-network and out-of-network deductibles on insurance cards, and hospitals would be required to include ancillary services, including those completed by lab technicians, within a patient's hospital bill.

Where do we go from here?

Sens. Bill Cassidy (R-La.) and Maggie Hassan (D-N.H.), who introduced the Senate draft bill, have said they will collect feedback on their proposal over the coming weeks.

Rep. Frank Pallone (D-N.J.), chair of the House Energy and Commerce Committee, and Rep. Greg Walden (R-Ore.), the committee's ranking member—who introduced the House draft bill—said they intend to advance their bill through their committee and send it to the full House for consideration.

However, whether to create an arbitration process to resolve surprise bills could be a sticking point for the measures. The White House has said it doesn't support the arbitration process proposal, but Walden's said he and Pallone would be "willing to talk" with senators about using arbitration instead of the set payment rate they had proposed.

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