Health Reform WK-EDGE Legislation addressing surprise medical billing could lower overall health insurance premiums
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Monday, October 5, 2020

Legislation addressing surprise medical billing could lower overall health insurance premiums

By Lauren Bikoff, MLS

Legislation could reduce premiums by up to 5 percent.

Legislation aimed at reducing or eliminating surprise medical billing could lower overall health insurance premiums, according to recent research published in the American Journal of Managed Care. The study, Policies to Address Surprise Billing Can Affect Health Insurance Premiums, found that this type of legislation could reduce overall health insurance premiums by 1 percent to 5 percent.

The researchers analyzed 2017 data from 568.5 million claims from 44.8 million covered lives. They quantified the proportion of health plan spending on services for which surprise billing is common—provided by radiologists, anesthesiologists, pathologists, emergency physicians, emergency ground ambulances, and emergency outpatient facilities—and estimated the potential impact of proposed policies to address surprise billing on health insurance premiums.

The study found that more than 10 percent of health plan spending is attributable to ancillary and emergency services that commonly surprise-bill. Reducing payment for these services by 15 percent would reduce premiums by 1.6 percent ($67 per member per year), and reducing average payment to 150 percent of traditional Medicare rates—the high end of payments to other specialists—would reduce premiums by 5.1 percent ($212 per member per year). These savings would reduce aggregate premiums for the nation’s commercially insured population by approximately $12 billion and $38 billion, respectively.

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