Medical bill U.S. representativesGreg Walden (R-OR) and Frank Pallone, Jr. (D-NJ) announced thisweek they are officially investigating a group of private equityfirms that own physician staffing services. (Photo:Shutterstock)

|

The bipartisan, bi-coastal duo that has taken on surprise medical bills has turned its attentionto the role played by private equity firms in rising providercosts.

|

U.S. representatives Greg Walden (R-OR) and Frank Pallone, Jr.(D-NJ) announced this week they are officially investigating agroup of private equity firms that own physician staffing services.The firms–KKR & Co. Inc., Blackstone Group, and Welsh, Carson,Anderson, & Stowe–were sent requests to hand over "informationand documents pertaining to the firms' ownership of privatephysician staffing and emergency transportation companies, whichrecent research shows are a leading source ofsurprise medical billing," Walden said in a release.

|

Related: Surprise medical bills are becoming more common–andexpensive

|

The six-page letter to KKR, for instance, asked fordetailed information about KKR's physician staffing and emergencytransportation holdings. Among the requests were annual in-networkand out-of-network revenue from each staffing and emergencytransport company currently or previously owned by KKR.

|

The two congressmen have been embroiled with health careproviders over ways to address the controversial "surprise" bills.But even as major providers have launched a concentrated attack on their proposal (the NoSurprise legislation) to rein in the bills, Walden and Pallone haveopened a second front on the private equity firms. "We areparticularly interested in your firm's relationship with anyphysician staffing companies and emergency transportationcompanies," Walden said in the press release.

|

Walden honed in on recent allegations that staffing firms andambulance companies owned by the private equity sector have beenrunning up excessive, and perhaps bogus, bills that have beenlanding in plan sponsors' laps. One major component of surprisebills comprises services provided outside of a plan's network thatconsumers thought were in-network services. The staffing servicescomponent represents in-network services that are billed atexcessive rates compared to other in-network providers, Waldensaid.

|

Citing research from the American Enterprise Institute and theBrooking Institution, the release said these hidden higher costswere yet another example of surprise billing practices.

|

"Evidence indicates that these physician staffing firms chargesignificantly higher in-network rates than their counterparts,thereby driving reimbursement upwards as they enter into staffingarrangements with hospitals," the release said.

|

The letters were sent Sept. 16 to the private equity firms. Thecongressmen requested responses no later than Sept.30.

|

Read more: 

Complete your profile to continue reading and get FREE access to BenefitsPRO, part of your ALM digital membership.

  • Critical BenefitsPRO information including cutting edge post-reform success strategies, access to educational webcasts and videos, resources from industry leaders, and informative Newsletters.
  • Exclusive discounts on ALM, BenefitsPRO magazine and BenefitsPRO.com events
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com
NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

Dan Cook

Dan Cook is a journalist and communications consultant based in Portland, OR. During his journalism career he has been a reporter and editor for a variety of media companies, including American Lawyer Media, BusinessWeek, Newhouse Newspapers, Knight-Ridder, Time Inc., and Reuters. He specializes in health care and insurance related coverage for BenefitsPRO.