Solutions for Surprise Billing: Accredited IROs Offer Unparalleled Benefits

The act of surprise billing – when a patient receives an unexpected medical bill, sometimes for thousands of dollars or more – is a common occurrence within the American health care system. Studies show that roughly 20% of surgical patients receive a surprise bill, at an average of $2,000 in non-covered fees.

While surprise bills may hit tens of thousands of patients per year and incur millions of unexpected medical costs, there is no single reason why this occurs. Instead, there may be multiple causes. For instance, a patient may choose to receive care from an out-of-network provider, resulting in the physician or facility engaging in balance billing, or charging for the cost of care that is not covered by the insurance company. Or a patient may receive care during an emergency and not have the option of choosing an in-network provider or may not know they are being treated by an out-of-network provider.

Independent arbiters offer hope

As attempts to address surprise billing at the federal level have failed to move forward in recent months, some states are finding success with their own surprise billing regulations. To date, 30 states have enacted laws to prevent surprise billing and limit the amount of out-of-pocket costs that patients must pay.

Some states, such as New York, Florida and Texas, have passed comprehensive balance billing protections. Other states, like Pennsylvania, Minnesota and Nevada, have at least partial patient protections on the books. Most state laws attempt to overcome surprise billing by holding patients harmless financially, which often means limiting the total dollar amount of bills sent to patients. One of the primary tactics that leading states have turned to is the use of an independent arbiter to help settle surprise billing disputes from another angle – that is, between the provider and the insurance company. Many states with active surprise billing laws use a formal independent dispute resolution (IDR) model to settle charge differences. Currently, nine of 13 states with a comprehensive approach feature an IDR process, according to researchers from The Commonwealth Fund.

The models that states have adopted for their IDR programs can vary. Some states work with experienced review organizations, and others have turned to a formal arbitration system. Ultimately, whichever model that states – and potentially the federal government – adopt would gain a clear advantage by contracting with leading accredited independent review organizations (IRO).

Experienced and accredited experts

Within health care, no type of entity is better equipped to solve the surprise billing challenge than accredited IROs. Not only do IROs already hold deep-seated experience in reviewing complex claims and coding cases, but they also provide a standardized, stable format that’s uniquely positioned – and, critically, ready to launch with already-built infrastructure – to address the nation’s surprise billing challenges.

Accredited IROs have a long track record of providing the gold standard in billing disputes. Working today within every community around the country, IROs have the necessary resources to address surprise billing disputes, with board-certified clinicians and coders poised to render these types of complex decisions. Given the staffing and structure that have long delivered conflict-free, evidence-based review determinations between parties, IROs are capable of reviewing from multiple competencies. Other arbiters tend to hold expertise in just one or two of these key areas.

“If you’re using arbitration, accredited IROs are uniquely positioned to deliver fair and evidence-based decisions,” says Aaron Turner-Phifer, Vice President of Government Relations and Policy with URAC, the leader in IRO accreditation. “This isn’t just a question about dollars. They also need expertise about coding, billing, clinical procedures and coverage.”

Because IROs already excel in reviews often requiring intense breadth of knowledge, they offer a seamless path to surprise billing arbitration. Building on the existing framework for external review, accredited IROs serving as arbiters ensure that:

  • Conflicts of interest are avoided, which will help mitigate potential delays in completing a review.
  • Highly qualified and specialized clinical and coding reviewers are utilized to ensure complete and accurate decisions.
  • Patients receive clinically appropriate services as part of any review
  • Accurate and timely decisions are delivered in a transparent manner.

New York offers a telling example of how qualified IROs can positively impact the surprise billing landscape. As the nation’s first state to systematically address surprise billing, New York has seen value in their IDR process because the law mandates that the IRO must rule in favor of the provider or payer in a binding decision. This provision encourages the parties to reach a settlement. Other states, including Illinois and New Jersey, have found success working within the arbitration model.

Whether it is working with states regionally or under potential federal regulations, the nation’s accredited IROs stand poised to deliver rigorous, evidence-driven reviews – the very mark they have long been known for – to help settle the emerging challenge of surprise billing disputes.

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