Now more than ever, the COVID-19 epidemic and resulting “shelter in place” policy have called our attention to health and economic concerns. Lawmakers in Congress have rushed to act, but taxpayers must examine their proposals carefully or we could find ourselves stuck with counterproductive “solutions.”
One issue that has come to the forefront is surprise medical billing. This is what they call it when a patient receives medical treatment and later finds out that it was not covered by his or her insurance. The surprise bill they receive in the mail can cost thousands of dollars and might be financially crippling.
Unfortunately, some people are using this problem as an excuse to get Congress to impose price controls that would actually make the problem worse. Under a national rate-setting plan, federal bureaucrats would decide the price of medical procedures and doctors would be forced to accept those prices, even if that causes them to lose money. We know from experience that doctors who lose money do not stay in business for long. Doctors may simply close their practices or limit the number of patients they see, reducing access to critical medical procedures.
Handing more control to Washington bureaucrats is not the right answer and it is often the formula for political corruption. That’s why last month, Americans for Tax Reform announced a letter signed by over 75 conservative organizations urging Congress to reject a price control plan.
California currently has a rate-setting program in place on the state level and the results illustrate why expanding such a policy nationally is a bad idea. Complaints over access to care have skyrocketed, doctors’ offices have closed or consolidated, and more doctors are considering leaving the state. Some estimates say California is short by as many as 10,000 doctors, and taxpayer-funded recruitment incentives, such as tuition reimbursement, have failed to turn the situation around.
Meanwhile, in Florida and New York, where surprise bills are handled with an Independent Dispute Resolution approach, access to care and doctor and patient satisfaction have increased. Following the adoption of Independent Dispute Resolution, the number of practicing physicians increased 12 percent, a noticeable spike, especially compared to California.
Successfully reducing healthcare costs and increasing access requires an honest look at where things went wrong. Costs have risen along with government overregulation. “Certificate of need” laws limit hospitals’ ability to expand, heavy-handed regulation has discouraged the creation of new insurance companies, and the Affordable Care Act has dramatically reduced our healthcare options.
Right now, Californians are understandably worried about surprise medical bills in the event they contract the COVID-19 virus, but a solution that makes the problem worse is not a solution.