A new bipartisan bill would mandate that Medicare Advantage (MA) insurers “adequately reimburse” providers for services, citing a trend of health systems pulling out of MA contracts.
The Prompt and Fair Pay Act was introduced by Reps. Lloyd Doggett, D-Texas, and Greg Murphy, R-N.C. The legislation would require that insurers pay providers at least what they would have received for services rendered under Medicare Part A and Part B.
While traditional Medicare is the benchmark for MA payments, insurers are not required by law to reimburse providers at the same level as Medicare. The legislators note that 27 providers have pulled out of MA contracts in the past year and said that MA plans also often underpay skilled nursing facilities.
“A rapidly growing Medicare DisAdvantage market is straining our health care system and threatening consumers’ access to necessary health care,” Doggett said in a press release. “With many providers already at risk of closure and MA now covering more than half of enrollees, it is essential that we ensure prompt and fair payments before every community is a healthcare desert.”
The bill is supported by many of the largest physician organizations, including America’s Essential Hospitals, the American Academy of Family Physicians, the American College of Physicians, the National Rural Health Association and Premier.
Bruce Siegel, M.D., president of America’s Essential Hospitals, called the bill “a step in the right direction” in addressing “woefully inadequate hospital reimbursements.”
“Essential Hospitals across the nation are facing unprecedented financial disruptions, jeopardizing their ability to serve patients and their communities,” Siegel said.
The legislators introduced the bill the same day a joint House hearing, attended by both Doggett and Murphy, examined the MA program. While the insurer representation at the hearing included speakers from Alignment Health and the SCAN Group, much of the conversation centered on the three largest players in the market: UnitedHealthcare, Humana and Aetna.
Murphy said that while smaller players like Alignment and SCAN are “doing it right” in how they approach MA, the largest firms have “bastardized the system.”
He lambasted UnitedHealth in particular and pointed to the ongoing criminal fraud investigation into the company’s billing practices in MA as well as its role as the largest employer of physicians in the U.S.
Murphy said that the response to the murder of UnitedHealthcare CEO Brian Thompson in December, including a wave of donations to support the defense of Luigi Mangione, who is charged with shooting Thompson, is emblematic of how people feel about the industry.
“Sadly enough, we have seen the nation respond against insurance industries,” he said. “That’s the outrage that we’re seeing.”