Another round in the battle between insurers and providers

America's Health Insurance Plans (AHIP), the trade group representing most of the nation's insurers, released an analysis of out-of-network billing practices. Of the 100 or so procedures that they analyzed, they found a wide range of how much out-of-network providers billed, with providers on average charging as little as 118% of Medicare for some procedures to as high as 1,382% of Medicare for other procedures. Understandably, insurers want to limit the ability of providers to charge whatever they want and have highlighted how this is a problem for patients who receive unexpectedly high bills after they visit an out-of-network provider. Providers obviously have their own take in their long-running antagonism against insurers, with the president of the American Medical Association countering that AHIP essentially cherry-picked their examples and that insurers are responsible for the industry's higher costs and for creating overly restrictive provider networks.

Restricting providers in terms of what they can charge when they are out-of-network for a patient would shift the balance of power towards the insurers. After all, if insurers can be assured of reasonable rates regardless of whether a doctor is in-network or not, they have less incentive to court providers. While this amounts to a cute angle of attack, it seems that insurers could have been much more effective in lowering costs by creating tools for patients to benefit from a more competitive market.