Using the Coronavirus Crisis to Implement Rate Setting is Unseemly | Citizens Against Government Waste

Using the Coronavirus Crisis to Implement Rate Setting is Unseemly

The WasteWatcher

Former Clinton adviser and Chicago Mayor Rahm Emanuel said in a November 2008 interview soon after the election of President Obama, “You never want a serious crisis to go to waste. … This is an opportunity, what used to be long-term problems, be they in the health care area, energy area, education area, fiscal area, tax area, regulatory reform area, things that we have postponed for too long, that were long-term, are now immediate and must be dealt with.  This crisis provides the opportunity, for us, as I would say, the opportunity to do things that you could not do before ...”

A year later, in response to the Great Recession, the country ended up with The American Recovery and Reinvestment Act of 2009, a “shovel-ready” stimulus package that did little to jump-start the U.S. economy, along with Obamacare, that raised healthcare costs, narrowed networks, and caused a lot of unnecessary disruption in the marketplace.

Unfortunately, we are now facing a much bigger crisis and some senators are trying to take advantage of it by including bad legislation in the third coronavirus bill that will not only fail to solve the problem it is meant to fix, it will also cause chaos in the healthcare system.

The legislation would establish rate-setting, or price controls, for surprise medical bills.  Price control always distorts markets and lead to shortages.  With the country already dealing with a shortage of medical supplies and personnel, this is dangerous idea.  It would be particularly pernicious for emergency room care and rural hospitals, both of which are essential at this time.

Citizens Against Government Waste (CAGW) is also not in favor of the other popular solution to surprise medical bills, government-mandated arbitration, where an independent party negotiates a payment from the insurer to the provider.  This is just rate-setting delayed since the arbitrator will consider local rates and come up with a similar compensation.

CAGW thinks a better way is to allow the Federal Trade Commission to address potential false and misleading advertising regarding in-network facilities.  In other words, if an insurer claims a hospital is in their network and the hospital advertises that it is in the insurer’s network but if a patient that utilizes their in-network hospital gets a surprise medical bill from an out-of-network doctor, that is false advertising, and both the insurer and hospital will be fined.  The patient will be held harmless.  We believe with this policy in place, insurers and hospitals will come to agreement in advance on how an out-of-network doctor will be compensated.

With at least four different bills that have not been reconciled into a single approach to surprise medical billing, and an agreement that no one will get a surprise medical bill for coronavirus testing, there is absolutely no need to move forward now on any other policies.  CAGW signed a coalition letter with 23 other groups today to make that clear.

Everything Congress does during this crisis should be targeted and temporary to help businesses and citizens weather through the COVID-19 storm.  It is unseemly to try to take advantage of this crisis to promote anything else.

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