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Late last month, before President Biden took office and proposed his new pandemic relief plan, Congress passed a nearly 5,600-page legislative package that provided some pandemic relief along with its more general allocations to fund the government in 2021.
While the pandemic funding got most of the attention, some even bigger changes for health care were buried in the other parts of that huge December package of laws.
The legislative bundle included a ban on surprise medical bills, for example — a problem that key lawmakers had been wrestling with for two years. Starting in 2022, thanks to the new law, patients generally will not pay more for out-of-network care in emergencies and for care at in-network facilities that is provided by an out-of-network doctor or laboratory.
But surprise bills weren’t the only health care issue Congress addressed as it ended a tumultuous year. Lawmakers also answered pleas from strained health facilities in rural areas, agreed to cover the cost of training more new doctors, sought to strengthen efforts to equalize mental health coverage with that of physical medicine and instructed the federal government to collect data that could be used to rein in high medical bills.
Here are some details about the big changes Congress made in December in regards to health care.
Rural hospitals get a boost
Throwing a lifeline to struggling rural health systems — and, it appears, a bone to an outgoing congressional committee chairman — lawmakers gave rural hospitals a way to get paid by Medicare for their services regardless of whether they have patients in beds.
The law creates a new category of provider, known as a “rural emergency hospital.” So starting in 2023, some hospitals will qualify for this designation by maintaining full-time emergency departments (among other criteria) without being required to provide in-patient care. The Department of Health and Human Services will determine how the program is implemented and which services are eligible.
Medicare, the federal insurance program that covers more than 61 million Americans who are 65 or older or who have certain disabilities, currently does not reimburse hospitals for emergency or hospital outpatient services unless the hospital also offers in-patient care.
That requirement has exacerbated financial problems for rural hospitals. Many of these facilities have to balance serving communities that have fewer residents — and, so, less need for full in-patient services — with the need of those communities to always have emergency and outpatient services at the ready. One study last year found 120 rural hospitals had closed in the past 10 years, with more at risk.
Hospital groups have praised the change that the December legislation makes. That part of the bill was introduced by Sen. Chuck Grassley, R-Iowa, who has long championed rural health issues and ended his term as chairman of the Senate Finance Committee this month. “I worked to ensure rural America would not go overlooked,” Grassley said in a news release.
Medicare invests in more doctors
Hoping to address a national shortage of physicians — which has become especially dire during the coronavirus pandemic — Congress enacted a law that creates an additional 1,000 medical residency positions over the next five years.
Medicare will fund the new positions, which will offer supervised training to medical school graduates going into emergency medicine and certain other specialties. The new jobs will be distributed among hospitals most in need of personnel, including rural hospitals.
Critics, including The Wall Street Journal‘s editorial board, have noted that the move is Congress’ attempt to fix a problem it created in the late 1990s. That’s when lawmakers capped the number of Medicare-funded residency positions in the United States, fearing too many doctors would inflate the cost of Medicare.
While Medicare is not the only source of educational funding and hospitals may add their own residency slots as needed, Medicare generally will reimburse hospitals for the number of residents they had at the end of 1996. Among other consequences of that 1996 cap, most Medicare-funded residencies are clumped at Northeastern hospitals, a 2014 study showed.
In contrast to the 1,000 positions created as part of the December package, a different bipartisan proposal in 2019 that was never enacted would have added as many as 15,000 positions over five years.
Strengthening mental health parity
The legislative package strengthens protections for mental health coverage — it requires federal officials to study the limitations that insurance companies place on coverage for mental health and substance use disorder treatments.
In 1996, Congress passed the first law barring health insurers from passing along to patients more of the cost for mental health care than they would for medical or surgical care. The Affordable Care Act, building on earlier laws, made mental health and substance use disorder treatments “essential health benefits” — in other words, it requires most health insurance plans to routinely include mental health coverage.
But enforcing that standard has been a challenge, in part because violations can be hard to spot and the system has often relied on patients to notice and report them.
In December, lawmakers approved a measure requiring insurers to analyze their coverage and provide their findings to state and federal officials upon request.
They also instructed federal officials to request the findings from at least 20 plans per year that may have violated mental health parity laws and tell insurers how to correct any problems they find — under penalty of having any insurer violations reported to their customers if they do not comply.
The law also requires federal officials to publish an annual report summarizing the analyses they collect.
More transparency in cost and quality
Americans often do not know how much they will be expected to pay when they enter a doctor’s office, an ambulance or an emergency room.
Taking another modest step toward transparency, Congress’ latest move bans gag clauses in contracts made between health insurers and providers.
Among other things, these sorts of “gag” restrictions previously have prevented insurers and group health plans from sharing information about a provider’s prices or quality with patients and others, such as employers. The December legislation also prohibits insurers from agreeing to contracts that prevent them from getting access electronically to claims and other information from providers on behalf of the insurer’s enrollees.
In 2018, Congress banned gag clauses in contracts between pharmacies and insurers or pharmacy benefit managers. Those gag clauses had prevented pharmacists from sharing cost information with patients — such as whether patients might be able to get a lower price for a prescription drug by paying out of pocket rather than using their insurance coverage.
The proposal approved in December’s legislation came from a big bipartisan package of health care cost fixes passed in 2019 by the Senate Health, Education, Labor and Pensions Committee, but not by the rest of Congress. The committee’s Republican chairman, Sen. Lamar Alexander of Tennessee, retired from Congress this month. His Democratic partner on that bipartisan package, Sen. Patty Murray of Washington, will take over the chairmanship as Democrats assume control of the Senate. Murray has vowed to focus on health care affordability.
Consumers First — an alliance of health professionals, labor unions and others, led by Families USA — praised the ban. In a written release, the consortium called the change “a significant step forward” to stop “the abusive practices from hospitals and health systems and other segments of the health care sector that are driving up health care costs and making health care unaffordable for our nation’s families, workers, and employers.”
Kaiser Health News is a nonprofit, editorially independent program of the Kaiser Family Foundation and is not affiliated with Kaiser Permanente. KHN senior correspondent Sarah Jane Tribble contributed to this report.