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House bill makes it clear: No fees for health plan EFTs

Tanya Albert Henry , Contributing News Writer

What’s the news: If ultimately signed into law, newly proposed legislation would bar vendors from charging physicians unnecessary fees for electronic fund transfer (EFT) payment transactions.

The AMA worked closely to help draft the No Fees for EFTs Act (H.R. 6487) and strongly supports the legislation introduced by a bipartisan group in the House of Representatives.

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“Insurers have slashed reimbursement rates, foisted prior authorization requirements on physicians and created narrow networks. But requiring physicians to pay fees to get paid? This bill would give much needed relief to physician practices and score a victory for common sense,” said AMA President Jesse M. Ehrenfeld, MD, MPH.

The legislation was introduced by Reps. Greg Murphy, MD, (R-N.C.), Morgan Griffith (R-Va.), Marianette Miller-Meeks, MD (R-Iowa), Ami Bera, MD (D-Calif.), Kim Schrier, MD (D-Wash.) and Derek Kilmer (D-Wash.).

Why it’s important: The Affordable Care Act requires health plans to offer medical practices standardized electronic payment, but some insurers or their vendors are imposing fees of 2% to 5% of the claim payment for practices that choose to be paid through these transactions. It’s an unnecessary and costly burden for physicians who face many other administrative barriers to patient care.

Nearly 60% of practices surveyed by the Medical Group Management Association (MGMA) said that they are forced to pay these percentage-based fees without ever having agreed to them. A third-party vendor that health plans require practices to contract with most often assesses the fees for purported “value-added services” such as a customer-service hotline.

MGMA says that 75% of practices’ annual revenue is paid via EFTs and that the fees can cost a large practice up to $1 million annually.

In an earlier letter to the Centers for Medicare & Medicaid Services (CMS) administrator, the AMA and others likened the situation to a company requiring an employee to enroll in a program that would deduct a percentage of their paycheck so that they can receive direct deposit payments from their employer.

Physicians or practices that have tried to quit EFT fee-based programs faced significant administrative burdens and lost valuable practice time and resources that could have been better spent on patient care. And paying the fees means practices have less to invest in staff, equipment, data analytics and information that could improve patient access and quality of care.

The earlier AMA letter—also signed by 91 state medical associations and national specialty societies—noted that the CMS National Standards Group has been reluctant to use its enforcement authority to curb “an obvious statutory and regulatory violation.”

Physicians are hopeful that, if adopted, the plain language in the proposed No Fees for EFTs Act would finally stop this predatory fee process.

Dr. Miller-Meeks said that physicians and hospitals “in small rural areas are already struggling to “provide timely care without having to factor in the even greater administrative burdens and fees” that they are facing with electronic payments.

Dr. Schrier said these fees are “yet another hurdle in the healthcare system” and that they prevent “physicians from getting the compensation they deserve." She said she took part in introducing the legislation “in hopes of prohibiting these excessive fees impacting our medical providers at a time when we are experiencing severe doctor shortages nationwide."

Learn more: The AMA has developed electronic payment resources to help physician practices navigate the ins and outs of EFTs and avoid unwanted additional services and fees.