A new ad campaign takes aim at the "misaligned incentives" in the No Surprises Act arbitration process, arguing they "create a ‘fox guarding the hen house’ dynamic."
The seven-figure campaign from the Coalition Against Surprise Medical Billing, called "Judge Fox," features a court battle between a pair of chickens and a pair of foxes. The chickens confer and say that a "reasonable judge" would not allow these foxes to freely set prices for medical bills.
Then the judge also turns out to be a fox, meant to illustrate that private equity firms that own providers that purportedly flood the dispute resolution system may also operate the independent entities meant to mitigate these disputes.
The coalition said in a press release that the campaign comes "amid mounting evidence that some private equity-backed providers and IDR middlemen are relentlessly abusing the IDR process to maximize their own profits at Americans’ expense."
The ad is running the group seven figures and will roll out in the District of Columbia as the organization seeks to reach lawmakers to spur changes to the No Surprises Act (NSA). Coalition members include leading payer organizations like AHIP and the Blue Cross Blue Shield Association and a slew of employer organizations such as the Business Group on Health, the Purchaser Business Group on Health and the National Alliance of Healthcare Purchaser Coalitions.
The coalition's website notes that 3.3 million disputes have reached the independent resolution process since the portal launched in April 2022, far more than regulators projected.
Under the NSA, providers are barred from sending balance bills to patients. However, the law was designed with the expectation that most disputes would be resolved in payer-provider negotiations, with relatively few proceeding to the IDR process.
When a dispute reaches arbitration, data show that providers are far more likely to prevail and earn significantly higher payouts. Per the coalition's data, providers win in 87% of IDR decisions.
In addition, the coalition notes that in the first half of 2024, five organizations accounted for 63% of disputes: Team Health, SCP Health, Radiology Partners, AGS Health and HaloMD. This disparity has led to multiple lawsuits, with more than 30 filed to challenge the dispute resolution processes under NSA.
"CASMB and its members continue to urge policymakers to rein in these bad actors through enhanced transparency and oversight of IDR entities, private equity-backed providers, and the IDR middlemen flooding the system with ineligible, extreme claims," the organization said in the release.
Payers have been sounding the alarm about these trends for some time. Elevance Health, the parent company of Anthem plans, for example, has rolled out a new policy that penalizes hospitals and outpatient facilities that use out-of-network providers.
Providers, however, have hit back at this narrative, arguing that payers are bringing qualified payment amounts, or QPAs, to the negotiating table that are insufficient. A recent analysis from Capstone suggests that elevated levels of IDR activity are likely to continue, with providers expected to maintain their advantage in arbitration.