Two members of the House of Representatives have introduced a bill seeking to ensure parity between reimbursements for Medicare Advantage and traditional Medicare — and providers are reacting with gratitude.
The bipartisan bill, called the Prompt and Fair Pay Act, was introduced on Tuesday by Reps. Lloyd Doggett (D-Texas) and Greg Murphy (R-North Carolina).
The legislation would set a minimum payment standard, requiring Medicare Advantage plans to reimburse providers at no less than the rates paid under traditional Medicare Parts A and B. However, it would still allow payers and providers to agree on higher rates if they choose.
The bill also includes rules for timely payment of in-network claims, similar to the prompt payment requirements already in place for Medicare Part D.
Medicare Advantage payments are based on benchmarks from traditional Medicare spending — but current law doesn’t require Medicare Advantage plans to pay providers at the same rates. Because of this, many health systems and other provider organizations are losing an unsustainable amount of money — forcing many to exit their contracts with Medicare Advantage plans.
So far this year, nearly 30 health systems have dropped their Medicare Advantage plans.
“Providers are having to choose between substantial reimbursement delays that are often less than what is truly owed, administrative burdens, care denials, or an outright withdrawal from MA contracts. 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 health care desert. Our bill is an important step to protect patients and providers,” Doggett said in a statement.
His co-sponsor of the bill, Murphy, also pointed out that physicians who see Medicare Advantage beneficiaries face higher rates of prior authorization denials — which jeopardizes patient safety, especially for those with chronic illnesses, cancer or mental health issues.
The bill has been endorsed by several major lobbying groups representing provider organizations and physicians, such as America’s Essential Hospitals, American Academy of Family Physicians, American College of Physicians, National Rural Health Association, Premier and the American Association of Nurse Anesthesiology.
Bruce Siegel, CEO of America’s Essential Hospitals, praised the legislative effort in a statement, saying that it would help alleviate providers’ ongoing financial woes.
“The Prompt and Fair Pay Act is a step in the right direction, providing concrete steps to fix woefully inadequate hospital reimbursements. We will continue to support common sense legislation like this that aims to better sustain and support our hospitals, and the communities they serve,” he declared.
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