Lawmaker not giving up on preventing unexpected medical bills

By Alison Noon, Associated Press

Wednesday, May 31, 2017 | 2 a.m.

CARSON CITY — A Nevada lawmaker changed strategies Tuesday after a decade of negotiations with hospitals and insurance companies have failed to produce a statewide ban on surprise medical bills.

After 14 years of legislative wrangling, Assemblywoman Maggie Carlton said it is time for voters to weigh in on a proposal to cut out-of-network hospital costs.

Supporters at a legislative hearing told stories of facing mountains of debt and hardship after they were taken unwittingly to health centers that did not accept their insurance.

Following a debilitating rollover car crash, Carol Lynne Hansen was rushed to critical treatment at the nearest hospital in a helicopter. Because the facility did not accept her insurance, she said she faced bills that were tens of thousands of dollars higher than the covered rate. The helicopter trip alone will cost her more than $60,000.

"I cannot sleep, have suffered a huge emotional toll and have lost my credibility, but the worst part is that it has destroyed the superior credit that I worked my entire life to build — I'll be dead before this falls off my credit report," she said.

Thousands of people in Nevada go through similar experiences, supporters said.

If lawmakers approve the proposal this year and again in 2019, Assembly Joint Resolution 14 would ask voters in 2020 to cap the amount that insured patients could be charged out of network at 150 percent of the Medicare or other federal reimbursement rate.

That's lower than previously discussed this session .

Five hospital executives told lawmakers the rate would cripple services and lead to facility closures.

"We struggle to sustain financial viability in rural, underserved areas such as Ely and, if this legislation went through as-is, William Bee Ririe Hospital would cease to exist, which means that the nearest health care would be over 200 miles away," the Ely hospital's CEO Matt Walker told lawmakers.

Government-subsidized health care programs Medicare and Medicaid reimburse hospitals for patient services at rates substantially lower than the rates facilities agree to with private insurers. Because out-of-network bills help make up for what's lost on Medicare and Medicaid patients, capping those bills at 150 percent of the low government rates would be insufficient to continue operating, the executives said.

The measure would lead to an exodus of physicians, halt capital investments and force hospitals to close programs or eliminate high-cost procedures and prescription drugs, said Todd Sklamberg, CEO of Sunrise Hospital & Medical Center and Sunrise Children's Hospital in Las Vegas.

"This is not a threat, but it is a reality," Sklamberg said.

Carlton introduced the ballot proposal after talks with hospital representatives and insurance companies to cap out-of-network costs through regular legislation came to a standstill earlier this month.

"The ball's in their court now," Carlton said after the hearing. "I'm ready to negotiate when they are."

Insurance companies negotiate in-network prices with medical facilities and individual doctors. Contracts allow the two sides to estimate and expect a steady amount of patients and revenue.

For patients with health insurance outside those contracts, Assembly Bill 382 would determine bills through a mediation process between hospitals and insurers, leaving patient costs for thousands of out-of-network claims to be settled on an individual basis with no mandatory starting rate or formula to follow.

"The current proposed legislation moves away from numbers, but at some point a number has to be determined," Sklamberg said of AB382.

Unless all sides can agree on what that formula should be, Carlton said she will continue to pursue the ballot measure. Patient advocates want to make rates as affordable as possible for patients, while hospitals worry about charging enough to cover overhead costs and incentivizing insurers to negotiate with them.

Sklamberg said that in order for hospitals to get behind a surprise-bill rate, "It would need to be a large multiple of Medicare."