WASHINGTON — Dark-money groups have been going after Congress for trying to free Americans from burdensome surprise medical bills. Now Congress is going after them.
In an investigation launched Sept. 16, leaders of the House Energy and Commerce Committee are demanding answers from three private equity firms about their relationship with companies that staff doctor offices and emergency rooms around the country and are a source of unexpected bills that leave thousands of Americans in medical debt every year.
Two of the staffing companies — TeamHealth and Envision Healthcare — have been pouring millions of dollars into ads opposing legislation to reform the practice known as surprise billing, as detailed in this recent report by The New York Times. They've kept their staff and funding secret, making it hard to figure out who is behind the effort to stymie one of the most bipartisan efforts on Capitol Hill this year.
They contract with hospitals to supply them with emergency physicians and specialists. But they're known for charging significantly higher rates when a patient gets care from a provider or hospital outside their plan's negotiated network.
"We are concerned about the increasing role that private equity firms appear to be playing in physician staffing in our nation's hospitals, and the potential impact these firms are having on our rising health care costs," Chairman Frank Pallone, D-Md., and ranking member Greg Walden, R-Ore., wrote to private equity firms KKR & Co.; Blackstone Group; and Welsh, Carson, Anderson & Stowe.
Tackling surprise medical billing appeared to have a lot of steam at the beginning of this year, as multiple committees in Congress worked on legislation laying out how out-of-network payments should be settled between insurers, hospitals and doctors. There was — and remains — a strong consensus among lawmakers and industry groups that patients shouldn't have to pony up when they have to visit an out-of-network emergency room or get care from an out-of-network physician in an in-network hospital.
The effort hasn't stopped — but it has been slowed by a tug-of-war between insurers and providers, who disagree over how best to resolve out-of-network bills.
And now these private equity firms have emerged as a secretive force trying to halt the effort entirely. The companies are the largest financial backers of a mysterious group called Doctor Patient Unity, which has spent more than $28 million on ads opposing surprise medical billing legislation.
"Doctor Patient Unity represents tens of thousands of doctors across the country who understand the importance of preserving access to lifesaving medical care and support a solution to surprise medical billing that protects patients," Greg Blair, a spokesman for the group, told the Times, weeks after it was first contacted about the ads.
"We oppose insurance-industry-backed proposals for government rate setting that will lead to doctor shortages, hospital closures and loss of access to medical care, particularly in rural and underserved communities," the spokesman said.
There's a reason private equity firms have been snatching up provider companies. There's a lot of profit to be made. In 2016, Blackstone Group bought TeamHealth for $6.1 billion. KKR bought Envision's group ambulance subsidiary in 2017 for $2.4 billion. And last year, KKR acquired the rest of Envision for nearly $10 billion.
In the meantime, medical debt remains the top cause of bankruptcy filings in the United States, as there are few checks on doctors and hospitals charging exorbitant rates to patients.
This article was written by Paige Winfield Cunningham, a reporter for The Washington Post.