Medical billing is shrouded in mystery, and the final dollar amounts often come as a surprise at the least opportune time.
A few years ago, while my Marine husband was deployed overseas, I broke my thumb and needed to visit the emergency room for treatment. I went to a large, nearby hospital off-base where I received medical attention and was sent home.
I’m sure the billing department had cartoon-like dollar signs for eyes when they saw my insurance information. I was covered by TRICARE, the military’s insurance provider.
Government-provided health insurance providers — think TRICARE, VA health coverage, or Medicare — operate differently, but not when it comes to reimbursement rates. Providers can bill VA and TRICARE at Medicare rates, and Medicare pays a lot more when care is provided in a hospital setting.
Treating me meant the hospital could bill my insurance provider at a much higher rate than the care actually costs. Had it been delivered elsewhere, by an independent provider, it would have been cheaper. Hospitals bill at the higher rate because the law allows them to. The bill was bigger, not because of the quality of the care, but because of where I went to get it.
This disparity incentivizes hospitals to become monopolies, because when independent physician practices and outpatient facilities merge with a larger hospital system, the system can charge more, despite there being no improvement in convenience or quality.
Medicare pays out 106%-217% more to these facilities and large systems than it does to the smaller, privately owned facilities. Hospitals use Medicare rates for billing care for service members and their families who have Tricare, as well as veterans who are covered under the VA for their health insurance.
Under both systems, hospitals are essentially allowed to rip the government off when veterans and their families utilize the community care (care outside of a military or VA facility) they’re entitled to.
So large hospital systems buy up their competition, reclassify the newly acquired facilities as hospital-based settings, and then raise their prices with impunity, because there is no competition or incentive to drive costs down. The share of practices owned by hospitals more than doubled between 2013 and 2018, and by 2020, more than half of all physicians worked either directly for a hospital or in a hospital-owned practice.
These facilities give you the exact same services, but at a much higher cost.
This is why people think the medical industry is dishonest. But it’s just working within the loopholes and special circumstances the government has created.
The law of the land encourages taxpayer-funded health insurance programs like Medicare, VA, and TRICARE to reduce competition and drive up prices. That equals fewer options with high out-of-pocket costs for patients.
Luckily, there is a commonsense solution that can fix this issue - site neutrality.
The principle behind site-neutrality is simple: “same service, same price,” regardless of where you get the care. This would unleash competition and drive down costs for seniors, veterans, and service members, and save taxpayers money, too. Those are wins for everyone.
Naturally, the powerful hospital lobby is opposed to such a concept. But site neutrality is widely popular and bipartisan as it increases access and lowers costs — two things Americans are hungry for in their health care.
Senator John Kennedy of Louisiana recently introduced the Same Care, Lower Cost Act (S-1629) to end this unfair billing practice. If enacted, the bill would save taxpayers $157 billionover its first 10 years.
And over in the House, Representative Rich McCormick of Georgia, a veteran and former emergency room physician, is seeking to break the logjam with a pair of new bills would specifically address the situation I found myself in: the Servicemember Site-Neutrality Act(HR-873) and the Veterans Site-Neutrality Act (HR-874), which would institute site-neutral payments in TRICARE and the VA, respectively.
If enacted, medical care for veterans and service members will be billed at a lower rate for the same care they’re getting today, with the same quality, and with more options to choose from. They would also save the VA and the DoD health care programs taxpayer dollars, making it easier to fully fund desperately needed options like the VA Community Care Program created by the historic VA MISSION Act.
As a military spouse, it especially bothers me that my care and that of military families and veterans cost more for no good reason. I feel like a pawn in a backwards health care system, one that incentivizes using health care for the military and their families as a money maker.
That’s why I’m so glad to see site-neutral legislation targeted at care for the military community. We’re not looking for handouts, “perks,” or anything dishonest or unfair.
Veterans and service members earned their care. They should have access to it at the highest quality and convenience — at competitive, affordable prices. Site-neutrality is the answer.
Lauren Stewart is senior federal affairs liaison at Americans for Prosperity and Concerned Veterans for America and a military spouse.
