Practice Management News

1 in 5 Childbirths Lead to Surprise Billing, Study Shows

As implementation of the No Surprises Act begins, a new study analyzes the prevalence of surprise billing for childbirth and newborn hospitalizations in the US.

1 in 5 Childbirths Lead to Surprise Billing, Study Shows

Source: Getty Images

By Jill McKeon

- One in five privately insured families who had in-network deliveries in 2019 received surprise bills for childbirth or newborn hospitalizations, according to a study published in JAMA Health Forum. Families faced a median total liability for potential surprise bills of $744.

The study analyzed 2019 data from Optum’s deidentified Clinformatics Data Mart, containing data from 12 million privately insured enrollees, to determine the frequency and impact of surprise billing relating to childbirth and newborn care. New legislation will go into effect in 2022 with the intent of reducing surprise billing.  

Passed in December 2020, the No Surprises Act prevents providers from charging patients with excessive out-of-network bills. Specifically, the law bans billing patients more than in-network cost-sharing prices for out-of-network services, in order to protect patients from surprise billing.

HHS released an interim final rule with request for comments on July 1st, signifying Part I of No Surprises Act implementation. The interim final rule is open for comment for 60 days and will go into effect 60 days after it is published on the Federal Register.

The rule also bans surprise billing for emergency services and requires providers to give advance notice to patients who may face out-of-network charges. The No Surprises Act will also establish an arbitration process to rectify unexpected charges, though no mention of how the government will establish the process was made in Part I.

"No one should ever be threatened with financial ruin simply for seeking needed medical care," US Secretary of Labor Marty Walsh, said in an HHS press release.

"Today's Interim Final Rule is a major step in implementing the bipartisan No Surprises Act that will protect Americans from exorbitant health costs for unknowingly receiving care from out-of-network providers."

The study defined potential surprise bills as professional claims from both ambulance providers and out-of-network clinicians. Researchers subtracted in-network reimbursement from charges to determine the estimated liability for these bills.

In addition, researchers evaluated the potential benefits of surprise billing protections and legislation by assessing the frequency and cost of potential surprise bills “among deliveries with or without [one] or more claim for cesarean delivery and among newborn hospitalizations with and without [one] or more claim for neonatal intensive care.”

Of all 95,000 families included in the final analysis, 18.8 percent had one or more potential surprise bills relating to delivery, newborn hospitalizations, or both. While the median total liability was $744, over 6,000 families faced over $2,000 in total liability for surprise bills.

Cesarean delivery and neonatal intensive care led to the most potential surprise bills and had the highest costs. Researchers concluded that surprise bills may add significant financial strain to families who are already facing substantial childbirth costs outside of the hospital. Surprise billing protections like the ones outlined in the No Surprises Act are a crucial benefit to growing families.

“Notably, the high frequency of out-of-network care in our study, coupled with the fact that childbirth is the most common reason for hospitalization, suggests that childbirth hospitalizations are currently one of the most frequent sources of surprise bills in the US,” the study concluded.