Insurance Companies Are Exploiting Coronavirus to Make Money
As the coronavirus pandemic sweeps into our communities, and sweeps through our economy, there is, at least, a silver lining. Neighbors are helping neighbors. Communities are doing their best to help members survive the economic downturn. People are staying home to prevent the spread of disease. It seems like we are all in this together.
But not quite.
While the rest of us are doing our best to weather the storm, big insurance companies have found an opportunity to make money – lots of it. They initially led the public to believe they would do the right thing during this crisis by putting surprise medical bills on hold. It didn’t take long for them to distance themselves from that idea. A spokesperson for the insurance industry clarified that they had only agreed to waive out-of-pocket costs for COVID-19 testing. That’s hardly the assurance we hoped to receive as we brace for the possibility that millions of people could fall ill in a matter of weeks.
Then they made it official. On March 18, an executive at the industry group that represents big insurance companies let Americans know that “Coronavirus patients who are treated in hospitals are likely to get surprise bills.” The same executive said, “Many under the system we have right now will get hit with surprise bills, even if they have coverage.”
If you’re not familiar with surprise medical bills, there’s really only one thing you need to know: they are singlehandedly caused by insurance companies. When an insurer refuses to cover out-of-network care, they pass the cost along to the patient. If there was ever a time to put surprise billing on hold, it would be an unprecedented viral pandemic that threatens to infect millions of Americans, overwhelm our healthcare system, and lead to massive medical expenses for people who get sick.
If insurers wanted to stop surprise billing, they could unilaterally make the decision to cover the cost of care. But they don’t want to stop surprise billing, and we don’t have to look far to understand why. For years, patients have been asked to pay more: rising premiums, higher deductibles, higher out-of-pocket limits. Insurance networks get narrower giving fewer options and forcing them to pay more for the care they do receive, all while big insurance companies enjoy massive profits and continue to set new records for revenue. They have no interest in halting the practice of surprise billing, not even during a global pandemic, because it would mean less money for them.
Not content to let a crisis go to waste, the insurance industry has even attempted to use the coronavirus crisis to sneak a major financial windfall into the latest coronavirus emergency spending bill. Insurers have heavily lobbied Congress for a surprise billing “solution” that lets them name their own prices by benchmarking out-of-network reimbursement rates to their own in-network rates. That would allow them to manipulate their in-network rates downward and juice their profits in the as a result. It appears that the insurers were brushed back in their attempt to insert this language into the emergency coronavirus bill, but that won’t stop them from continuing to lobby for a favorable law that protects their bottom line but only harms patients.
The actions by big insurance companies during the coronavirus outbreak make it painfully clear that Congress needs to do something to stop surprise medical bills. Addressing the issue on the insurers’ own terms stop their predatory actions. Instead, independent dispute resolution (IDR) is a proven solution that actually protects patients and removes them from the disputes that lead to surprise medical bills. IDR is an arbitration system that requires doctors and insurance companies to reach an agreement on reasonable payments for care. It’s already working at the state level and is the only way to stop surprise medical bills, protect patients, and hold insurance companies accountable.
As long as insurers are still able to pass surprise medical bills along to patients, they will continue to exploit the system for their own benefit. Unfortunately, we are seeing proof of that at the worst possible time. Not even a global health crisis will force the insurance companies to do the right thing for patients. Congress shouldn’t give them the choice.
Sean Shaw is an attorney at Vangard Law and the former Democratic nominee for Attorney General of Florida.