In First Quarter 2022, Relatively Sharp Increase in In-Network Care Occurred as the No Surprises Act Came into Effect

In-Network Care Increased across All Professional Specialties in Facility Settings from 2019 to 2023 Nationally and in All Regions

FAIR Health Study Further Revealed Greater Convergence of In-Network and Out-of-Network Allowed Amounts, Especially in Emergency Medicine and Radiology

NEW YORK, Feb. 20, 2024 /PRNewswire/ -- In-network care increased across all professional specialties in facility settings from the first quarter of 2019 to the third quarter of 2023 nationally and in all regions. During that period, in-network care as a percentage of all claim lines increased 7.0 percent nationally, from 84.1 percent of claim lines in the first quarter of 2019 to 90.0 percent in the third quarter of 2023.¹ The increase varied from 4.8 percent in the Northeast to 8.3 percent in the Midwest and South. From the fourth quarter of 2021 to the first quarter of 2022, a relatively sharp increase nationally (2.3 percent) and in all regions occurred across all specialties at the time the No Surprises Act (NSA) went into effect. These and other findings are reported in a FAIR Health white paper released today: In-Network and Out-of-Network Utilization and Pricing: A Study of Private Healthcare Claims.

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State and federal efforts to address surprise billing have increased in recent years. On the federal level, the NSA went into effect on January 1, 2022. To examine recent healthcare trends that may reflect in part the impact of state and federal surprise billing laws, FAIR Health delved into its database of private healthcare claim records, the largest such repository in the nation. The result is this study of in-network and out-of-network utilization and pricing from 2019 to 2023, a period that includes the first two years after the NSA took effect. The study focuses on professional services in facility settings, particularly in four specialties that have frequently been associated with surprise bills: anesthesia (including certified registered nurse anesthetists), emergency medicine, pathology and radiology. Changes in in-network percentage of claim lines are analyzed nationally and by region, as well as changes in the ratio of allowed to billed amounts for in-network and out-of-network services, and trends in average billed and allowed amounts.² Among the key findings:

• A large majority of professional services in facility settings were rendered in network both before and after the NSA went into effect in all specialties, nationally and regionally.
• When the focus is narrowed from all specialties to specialties of interest, an increase in in-network care from 2019 to 2023 is still apparent, but the growth was smaller. The increase in in-network care for specialties of interest from the first quarter of 2019 to the third quarter of 2023 was 4.7 percent, versus 7.0 percent for all specialties.
• From the first quarter of 2019 to the third quarter of 2023, radiology had the highest in-network percentage (ranging from 89.3 percent to 92.0 percent over the course of the period) compared to the other specialties of interest. Emergency medicine had the lowest in-network percentage (ranging from 71.6 percent to 83.1 percent).
• From the first quarter of 2019 to the third quarter of 2023, the in-network percentage of emergency medicine had a greater increase (13.2 percent) than the other specialties of interest. Pathology had the smallest increase (0.6 percent).
• In the South, in 2023, there was a decrease in in-network care for three of the four specialties of interest: anesthesiology, pathology and radiology.
• On average, allowed amounts as a percentage of billed amounts for both in- and out-of-network services decreased during the study period. The gap between allowed and billed amounts widened. From the first quarter of 2019 to the third quarter of 2023, allowed amounts as a percentage of billed amounts for in-network services fell by 14.3 percent; on average, allowed amounts were 46.2 percent of the billed amounts at the beginning of the period, and 39.6 percent of the billed amounts at the end. For out-of-network services, the decrease was 9.6 percent and the drop was from 39.0 percent to 35.3 percent of the billed amounts.
• A trend toward convergence of average in-network and average out-of-network allowed amounts was seen with emergency medicine and radiology procedure codes sampled in this report, and was also seen in FAIR Health analyses of the top 10 codes by volume in each of the following specialties: emergency medicine, pathology and radiology.

FAIR Health President Robin Gelburd stated: "The findings in this report have implications for stakeholders across the healthcare spectrum, including payors, providers, policy makers and patients. We hope that these findings will also be starting points for further research on in-network and out-of-network utilization and pricing against the backdrop of federal and state surprise billing laws."

For the complete white paper, click here.

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About FAIR Health
FAIR Health is a national, independent nonprofit organization that qualifies as a public charity under section 501(c)(3) of the federal tax code. It is dedicated to bringing transparency to healthcare costs and health insurance information through data products, consumer resources and health systems research support. FAIR Health possesses the nation's largest collection of private healthcare claims data, which includes over 45 billion claim records and is growing at a rate of over 3 billion claim records a year. FAIR Health licenses its privately billed data and data products—including benchmark modules, data visualizations, custom analytics and market indices—to commercial insurers and self-insurers, employers, providers, hospitals and healthcare systems, government agencies, researchers and others. Certified by the Centers for Medicare & Medicaid Services (CMS) as a national Qualified Entity, FAIR Health also receives data representing the experience of all individuals enrolled in traditional Medicare Parts A, B and D; FAIR Health includes among the private claims data in its database, data on Medicare Advantage enrollees. FAIR Health can produce insightful analytic reports and data products based on combined Medicare and commercial claims data for government, providers, payors and other authorized users. FAIR Health's systems for processing and storing protected health information have earned HITRUST CSF certification and achieved AICPA SOC 2 Type 2 compliance by meeting the rigorous data security requirements of these standards. As a testament to the reliability and objectivity of FAIR Health data, the data have been incorporated in statutes and regulations around the country and designated as the official, neutral data source for a variety of state health programs, including workers' compensation and personal injury protection (PIP) programs. FAIR Health data serve as an official reference point in support of certain state balance billing laws that protect consumers against bills for surprise out-of-network and emergency services. FAIR Health also uses its database to power a free consumer website available in English and Spanish, which enables consumers to estimate and plan for their healthcare expenditures and offers a rich educational platform on health insurance. An English/Spanish mobile app offers the same educational platform in a concise format and links to the cost estimation tools. The website has been honored by the White House Summit on Smart Disclosure, the Agency for Healthcare Research and Quality (AHRQ), URAC, the eHealthcare Leadership Awards, appPicker, Employee Benefit News and Kiplinger's Personal Finance. For more information on FAIR Health, visit fairhealth.org.

Contact:
Rachel Kent
Executive Director of Communications and Marketing
FAIR Health
646-396-0795
[email protected]

¹ A claim line is an individual service or procedure listed on an insurance claim.
² A billed or charge amount is the amount charged to a patient who is uninsured or obtaining an out-of-network service. An allowed amount is the total fee negotiated between an insurance plan and a provider for an in-network service, including both the portion to be paid by the plan member and the portion to be paid by the plan.

SOURCE FAIR Health