fb-pixel Skip to main content

‘Surprise’ medical billing ban included in legislation after Richard Neal gets on board

Representative Richard Neal walked down the steps of the Capitol in 2019.ERIN SCHAFF/The New York Times/file

WASHINGTON — Congress included a ban on the surprise, sky-high medical bills patients get when they use an out-of-network service this week, after Massachusetts Representative Richard Neal dropped his objections to earlier proposals and prevailed with his version of a fix.

The legislation will prevent doctors, hospitals, and air ambulance providers from charging eye-popping rates to patients who were provided out-of-network care without their knowledge, such as when patients are transported to an emergency room for treatment after an accident.

The practice has stuck some fully insured Americans with bills for services they had no idea were not included in their coverage. The measure, which is attached to the $900 billion coronavirus relief bill that Congress passed Monday night, is seen as a long overdue but significant win for consumers. Under the new legislation, patients who receive surprise medical bills can complain to the federal government, which may fine violators up to $10,000.

“This is one of the most ridiculous and craven parts of an absolutely ridiculous system that we have here. It’s greed at its worst,” said Alex Lawson, the executive director of the nonprofit Social Security Works, which has been advocating for a fix to the problem. “It’s a triumph to have a bill that actually addresses this.”


The fate of the rescue package and the massive federal spending bill it is linked to rests with President Trump, who sat out negotiations on the legislation, but now says it should include more direct aid for Americans. He has not said whether he’d sign the bill.

But the process was a slog, in part because Neal, a Democrat, from his perch atop the powerful Ways and Means Committee, blocked earlier fixes to the bill for more than a year that he believed would stick hospitals and doctors’ groups with too high a cost for care. As the deadline neared for getting the language into the relief bill, Neal refused to sign onto a compromise with other House committee chairmen, sparking bipartisan grumbling about his foot-dragging.


“It’s fair to say that Chairman Neal and the leadership of the Ways and Means Committee were among the slowest movers on this proposal and they certainly seemed to be the most comfortable with letting this spill over into the new year,” said Benedic Ippolito, a resident scholar at the American Enterprise Institute think tank.

Earlier this month, House Speaker Nancy Pelosi stepped in and urged Neal, who represents the state’s First Congressional District, and the other chairmen to strike a deal. Her intervention worked, but the final result is a bill closer to Neal’s health care provider-friendly vision than the one embraced by other committees.

It contains a provision close to Neal’s heart that other committees had rejected.

Under an earlier version of the proposal, the system would use an industry benchmark to set reimbursement rates for hospitals or doctors that charge out-of-network rates. But Neal’s version calls for the insurer and health care provider to go to arbitration to figure out a deal.

That’s a compromise that likely means more money for health care providers at insurers’ expense, which experts say could lead to higher premiums for patients over time.

“I never blinked on this one,” Neal said in an interview. “I felt very strongly that ours was the sound patient position and the sound consumer position.” Neal said he felt “terrific” that a deal had finally been reached.


“The idea that we could get three committees in the House, two committees in the Senate, and finally [Senate majority leader] Mitch McConnell to support our bill is pretty startling,” he said.

But Greg Walden, a Republican and the ranking member of the Energy and Commerce Committee who has advocated for the legislation, said he was worried the surprise medical fix was “on the rocks” about 10 days ago, due to Neal’s objections ― not McConnell’s. He told the Hill newspaper at the time that Neal’s committee just “cannot take yes for an answer.”

“I was pretty cranky about that I confess,” Walden told the Globe. But he praised the final outcome.

“Whatever happened happened and we got it back on track and we were able to make some adjustments,” he said. “I’m just glad in the end Ways and Means was able to come on board.”

Neal’s progressive primary challenger, Alex Morse, criticized him for blocking the deal during his race this year, alleging that Neal was unduly influenced by donations from Blackstone, a private equity firm that owns the hospital staffing company TeamHealth and thus benefits from pricey out-of-network bills. Blackstone was one of Neal’s top donors last year. The congressman handily staved off the challenge from Morse and then won reelection to his 17th term.

Neal called that allegation by Morse “nonsense.”

“The group on the other side of the issue was the insurance industry,” he said.


TeamHealth called the medical billing agreement “a significant improvement over the catastrophic proposals advanced by major insurance companies over the past two years,” the New York Times reported.

Over two years of debate, the surprise medical billing issue attracted many millions of dollars of TV ad spending and sparked a turf war in Congress, where up to five different committees tangled over jurisdiction of the issue.

“The process was ugly,” said Jen Taylor, the chief lobbyist for the patient advocacy group Families USA. “There were many committees of jurisdiction. There were a lot of hard feelings and deeply entrenched frustration.”

But the end result will end the pain and confusion many families have felt when they were stuck with a surprising bill from a doctor they did not realize was out of their network, often following a traumatic event like an emergency room visit.

“Any out-of-network anesthesiologist now that sends someone a bill for thousands of dollars when they only owe a couple of hundred of dollars — they could be fined $10,000,” explained Karen Pollitz, a senior fellow at the Kaiser Family Foundation.

One in 5 emergency room bills and about 1 in 6 in-network hospital stays end with a surprise medical bill, Pollitz said, which means millions of Americans have been affected each year.

The changes take place for plans that begin in 2022, so patients should still be wary of surprise medical bills next year. The bill also failed to resolve the issue of ground ambulances charging out-of-network fees, but air ambulances are covered by the provision.


Polling by the Kaiser Family Foundation found that the vast majority of Americans supported banning the practice. “This really is a salient issue for people and it bugs them and it haunts them,” Pollitz said.

Follow her on Twitter @lizcgoodwin.