UPDATE: May 20, 2020

Earlier today, the House passed HB 388 by a unanimous vote. It now heads to the Senate for consideration by the upper chamber.

Today Ohio took a big step towards solving the issue of surprise medical billing, with the House Finance Committee adopting and then favorably reporting a substitute version of House Bill 388.  The new version incorporates a novel approach – unlike anything that has been enacted in another state – to what happens when the health insurer and medical provider cannot come to mutual agreement on payment.

Approaches in other states typically default either to arbitration, which is preferred by the provider community, or to a benchmark payment rate, which is preferred by the insurers. The Ohio Chamber had sought a solution to this problem that did not utilization arbitration as the primary dispute resolution mechanism, believing that arbitration creates a costly new layer of bureaucracy and administrative waste and that it has led to significant health care cost escalation in states that have already implemented it – costs which are then shifted to private payers.

While the substitute bill does utilize arbitration, it is fashioned in a way that the Ohio Chamber is optimistic will not unnecessarily increase employer health insurance premiums. What is unique about the bill is that it requires the arbitrator to consider exclusively market-based factors in determining which final offer to accept and to decide in favor of whichever offer best reflects these factors.

This approach encourages negotiation, thus limiting the frequency of cases that may go to arbitration in the first place. HB 388 also gives both the providers and health plans a further disincentive to arbitration by requiring both to share in paying the cost of arbitration, no matter which side prevails.

The original version of HB 388, which was also supported by the Ohio Chamber, could not get enough support in the House due to strong opposition from the medical provider community. However, the substitute bill earned the support of both the medical provider community and health insurers.

The bill is expected to be voted on tomorrow by the full House, after which it will go to the Senate for consideration. With all of the aforementioned groups, along with the Ohio Chamber, now in support of HB 388, the contentious, months-long battle over how to end surprise billing may finally be nearing a conclusion.