POLICY

Surprise! No Surprise Billing Act is Live

The No Surprise Billing Act (NSA) is in full swing to protect patients from high medical charges from out-of-network providers. 

Surprise medical bills occur when a patient with private insurance receives care from providers or hospitals they did not choose who are out-of-network. The patient’s insurance typically pays less than the full charges (which happens over 75% of the time) and the out-of-network provider sends the patient a hefty bill covering the remainder of the charges. Surprise billing occurs in 20% of emergency room visits and 10% of surgeries that have out-of-network anesthesiologists. 

A Surprise Breakdown 

The legislation protects patients by: 

• Requiring private health plans to cover out-of-network claims and apply in-network cost-sharing, costs your insurance covers that you pay out of pocket (deductibles, co-insurance, copayments).
• Prohibiting out-of-network providers billing patients more than in-network cost-sharing amount. The charge will typically be based on the median in-network rate the plan pays for the service. Of note, this applies to air ambulances but not ground ambulances. 
• Setting a negotiation process, known as an Independent Dispute Resolution, if health plans and out-of-network providers can’t agree on a price. The losing party pays for the cost of the arbitration. 
• Penalizing providers up to $10,000 for each violation. 

The Impact

Surprise billing leads to higher premiums for private plans. So, the Congressional Budget Office estimates the NSA will reduce private health plan premiums by 0.5% to 1% on average and reduce the federal deficit by $17 billion over 10 years. Patients may also now have peace of mind knowing they won’t face extravagant charges after an emergency room visit.

Enforcement of the law will largely be based on complaints from patients. However, I am concerned about how patients will be educated on the NSA to know what to do if they receive a surprise medical bill.

• Have you ever received a surprise medical bill? 

Join the Discussion

BUSINESS

Large Health System Launches In-house Travel Nursing Agency

The University of Pittsburgh Medical Center (UPMC) is the first medical center to launch an in-house travel nurse staffing agency. The move to in-house will help address nursing shortages and save UPMC money on contracting with outside travel nurse agencies.

The Deets

UPMC will rely less on expensive outside staffing agencies through its in-house travel staffing. The medical center will allow employees to travel across its network for six-week assignments in Pennsylvania, Maryland and New York, depending on the supply of and demand for nurses. This program has the potential to save costs big time: 

UPMC can hire two UPMC travel nurses or techs for the price of one outside agency nurse.

#Trending 

The pandemic has influenced experienced nurses to retire early due to burnout and students to delay nursing school because of virtual teaching, leading to an immense nursing shortage. In California alone, there’s an estimated shortage of 40,000 nurses. In response to the nursing labor shortage, hospitals and health systems have had to pay high rates for temporary traveling nurses, hurting their margins. 

My Thoughts

UPMC’s decision to launch an in-house travel nurse agency is smart and innovative. The medical center is better positioned to control costs by cutting them in half and can bring in extra revenue by contracting its travel nurses with outside hospitals and health systems in need. Additionally, the in-house agency can serve as a pipeline to recruit nurses to UPMC at a time when hospitals are in desperate need of hiring and retaining nurses. 

• Do you think other health systems should launch in-house travel nursing agencies? ​

Join the Discussion

BUSINESS

Is Biogen Looking for a Way Out?

Samsung is in alleged talks to acquire pharmaceutical company Biogen for all of its shares, valued at $42 billion. It will be the largest overseas acquisition ever by a South Korean company if this goes through. 

The Deets

Samsung said it would invest $206 billion into biopharmaceuticals, artificial intelligence, semiconductors and robotics over the next three years. Acquiring Biogen would certainly check the “biopharmaceuticals” box. This wouldn’t be the first time Samsung and Biogen did business together: the two companies formed a $300 million joint venture to develop biopharmaceuticals in 2011. 

Biogen, which creates drugs to treat neurological diseases, has about 30 drugs in its pipeline. Its most recent drug launch, Aduhelm, has not gained the traction the company predicted due to shaky efficacy data and industry pushback (read my recap here). Sales from Aduhelm have therefore been slower than expected and the company recently cut its price by about half to $28,200 per year.

#Trending 

Samsung would be yet another company digging its feet deeper into healthcare. Recently, Oracle acquired electronic health record company Cerner for $28 billion. Healthcare is where the money is, and businesses know that.

Yes, But 

Samsung denies the media reports about the potential acquisition. But, of course, that doesn’t mean it can’t still happen, though.

OUTSIDE THE HUDDLE

• Speaking of Biogen, Medicare officials are in the process of deciding whether or not to cover Aduhelm, the company’s recently approved Alzheimer’s drug. It’s been a rocky start since its controversial approval.
• Believe it or not, I have no M&As to report on—unsurprising for a week straddled by Christmas and New Year’s.
• South Africa’s data suggests the Omicron wave has passed without a spike in deaths. Data from the country also found a Johnson & Johnson booster dose to be highly effective in preventing hospitalizations. This is some good news heading into 2022. 
• A jury found Teva Pharmaceuticals USA and other firms liable for the deadly opioid crisis in New York. Brush up on all the opioid-related lawsuits in 2021.