Judge strikes down part of Biden surprise billing rules in win for doctors

A federal judge in Texas on Wednesday struck down part of the Biden administration’s regulations protecting patients from getting stuck with “surprise” medical bills when they see the doctor, in a win for doctors who sued to block part of the rules.

The ruling leaves in place the protections for patients against getting bills for thousands of dollars in situations such as going to the emergency room and later finding out one of the doctors was not covered by their insurance. 

But it strikes down part of the regulations that govern how much insurers will pay doctors once the patient is taken out of the middle.

The ruling, from Judge Jeremy Kernodle, an appointee of former President Trump, is the latest in a long-running fight over the details of the rules.

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The Texas Medical Association, which brought the case in question, is one of several doctor and hospital groups that have sued, arguing the details of the rules would lead to damaging cuts to their payments and benefit insurance companies.

Many experts and consumer groups have defended the Biden administration’s rules, arguing that doctors are simply seeking to protect inflated payments.

Experts warn that if doctors groups get their way, it could lead to higher premiums for consumers once the higher prices are passed on to them.

Kernodle ruled that the Biden administration had departed from the text of the law passed by Congress in 2020 in issuing its regulations.

The regulations said that arbiters should start by assuming the correct amount for an insurer to pay the doctor is the median amount usually paid for that service in that geographic area. Doctors groups argue that the text of the law did not include such a presumption and that other factors such as the training and quality of the doctor should be given equal weight.  

Kernodle ruled in favor of the doctors, saying the regulation “rewrites clear statutory terms.” 

“This decision is an important step towards restoring the fair and balanced process that Congress enacted to resolve surprise billing disputes between health insurers and physicians,” the Texas Medical Association said in a statement on Wednesday.

Katie Keith, a health law expert at Georgetown University, said the ruling is evidence of how hard doctors groups will fight even relatively modest efforts by Congress to cut health care costs.  

The surprise billing action was “one of the few things Congress has tried to do on cost containment,” she said.   

The ruling can be appealed, and there are also other, similar lawsuits making their way through the courts.