Some of it is related to price transparency tools that do not exist. If they do, some people may not know how to use them or that they are out there, said Caroline Pearson, senior fellow at NORC.
The bottom line is the system isn't working, she said.
"Healthcare executives are focused on empowering consumers and thus far the system is failing," Pearson said.
Confusing charges and bills have been part of healthcare's fractured consumer experience.
Patients will receive a surprise bill related to an out-of-network clinician even after they've been assured the provider was in network. Insurance designs are also becoming more complicated as tiered or narrow networks come into play more often, different providers have different cost-sharing models, and there are more prior-authorization barriers.
When asked which groups are most responsible for surprise medical bills, 86% of survey respondents said insurance companies were very or somewhat responsible, compared to 82% who said hospitals were. Fewer respondents hold their doctors responsible, with 71% saying doctors are very or somewhat responsible.
Part of the problem is that physicians typically don't have the most recent data on whether doctors within their market changed hospitals or may be out of network. Also, hospital-owned outpatient departments have facility fees, which can unexpectedly increase costs.
Another issue is that hospitals use chargemasters, which are essentially price lists for individual procedures. Hospitals use the often-inflated prices, which have little bearing on the actual cost or quality of the procedure, to negotiate with payers. While hospitals don't typically receive the full list price in the chargemaster, the uninsured and out-of-network patients are generally charged the full amount.
But the survey points to a broader definition of surprise bills beyond an out-of-network physician charge, Pearson said.
"People are definitely confused by their insurance and struggle to understand benefit design, what their deductible is or who is going to be in network," she said. "The system does not empower patients to understand what costs are coming down the pike. This breeds a lack of trust and real frustration with the system."
Providers and insurers could alleviate these issues by making information more available and easier to use through better tools and more transparency, Pearson said. On the transparency front, it's important to include the negotiated rate for services that might be involved in a given procedure, she said.
The healthcare industry also needs to figure out why transparency tools haven't been widely adopted, Pearson said.
Around two dozen states have laws that protect consumers from surprise medical bills and more are in the works, according to a 2017 report from the Commonwealth Fund. The more comprehensive laws extend protections to both emergency department and in-network hospital settings, apply them to both HMOs and PPOs, prohibit balance billing, eliminate consumers' liability and implement payment standards or dispute resolution process to mitigate spats between providers and insurers.
"The issue is ripe for a policy solution, but most approaches are limited," Pearson said. "It's hard to figure out the right solution that is fair to everyone. But it strikes me that providers and insurers are each suffering from this so there should be some sort of compromise."