Association of Surprise-Billing Legislation with Prices Paid to In-Network and Out-of-Network Anesthesiologists in California, Florida, and New York: An Economic Analysis

Abstract

Importance: Several states have passed surprise-billing legislation to protect patients from unanticipated out-of-network medical bills, yet little is known about how state laws influence out-of-network prices and whether spillovers exist to in-network prices.

Objective: To identify any changes in prices paid to out-of-network anesthesiologists at in-network facilities and to in-network anesthesiologists before and after states passed surprise-billing legislation.

Design, setting, and participants: This retrospective economic analysis used difference-in-differences methods to compare price changes before and after the passage of legislation in California, Florida, and New York, which passed comprehensive surprise-billing legislation between January 1, 2014, and December 31, 2017, to 45 states that did not. Commercial claims data from the Health Care Cost Institute were used to identify prices paid to anesthesiologists in hospital outpatient departments and ambulatory surgery centers. The final analytic sample comprised 2 713 913 anesthesia claims across the 3 treated states and the 45 control states.

Exposures: Temporal and state-level variation in exposure to surprise-billing legislation.

Main outcomes and measures: The unit price (allowed amounts standardized per unit of service) paid to out-of-network anesthesiologists at in-network facilities and to in-network anesthesiologists.

Results: This retrospective economic analysis of 2 713 913 anesthesia claims found that after surprise-billing laws were passed in 3 states, the unit price paid to out-of-network anesthesiologists at in-network facilities decreased significantly in 2 of them: California, -$12.71 (95% CI, -$25.70 to -$0.27; P = .05) and Florida, -$35.67 (95% CI, -$46.27 to -$25.07; P < .001). In New York, a decline in the overall out-of-network price was not statistically significant (-$7.91; 95% CI, -$17.48 to -$1.68; P = .10); however, by the fourth quarter of 2017, the decline was -$41.28 (95% CI, -$70.24 to -$12.33; P = .01). In-network prices decreased in California by -$10.68 (95% CI, -$12.70 to -$8.66; P < .001); in Florida, -$3.18 (95% CI, -$5.17 to -$1.19; P = .002); and in New York, -$8.05 (95% CI, -$11.46 to -$4.64; P < .001).

Conclusions and relevance: This retrospective study found that prices paid to in-network and out-of-network anesthesiologists in hospital outpatient departments and ambulatory surgery centers decreased after the introduction of surprise-billing legislation, providing early insights into how prices may change under the federal No Surprises Act and in states that have recently passed their own legislation.

Figure 1.. Adjusted Differences in Unit Prices Paid to Out-of-Network Anesthesiologists at In-Network Facilities Between the Treatment States (California, Florida, and New York) and the Control States

Plots show adjusted differences in the out-of-network unit price between each treated state and control group relative to the date on which the law was passed; error bars represent 95% CIs for the point estimates in each quarter (calculated using standard errors clustered by physician); the y-axis is rescaled by the difference in the mean unit price between treatment and control states in the reference period (first quarter [Q1] 2014) when the mean out-of-network unit prices compared with control states were: –$51.69 in California, +$110.54 in Florida, and +$16.52 in New York; and vertical lines within the graphs indicate the time period between the law's passage (orange) and its effective date (blue): California, Q4 2016 and Q3 2017; Florida, Q2 2016 and Q3 2016; New York, Q2 2014 and Q2 2015).

Figure 2.. Adjusted Differences in Unit Prices Paid to In-Network Anesthesiologists Between the Treatment States (California, Florida, and New York) and the Control States

Plots show adjusted differences in the in-network unit price between each treated state and the control group relative to the date on which the law was passed; error bars represent 95% CIs for the point estimates in each quarter (calculated using standard errors clustered by physician); the y-axis is rescaled by the difference in the mean unit price between treatment and control states in the reference period (first quarter [Q1] 2014) when mean in-network unit prices compared to control states were –$2.92 in California, +$3.70 in Florida, and +$11.39 in New York; and vertical lines between panels indicate the time period between the law's passage and its effective date (California, Q4 2016 and Q3 2017; Florida, Q2 2016 and Q3 2016; New York, Q2 2014 and Q2 2015).