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Despite recent reforms, “balance billing” – the practice of charging patients exorbitant list prices for out-of-network or uninsured care – remains a potentially devastating feature of American healthcare. Most proposed solutions have been statutory or regulatory. But the common law offers an important intervention, consistent with private law theory, through a doctrine developed by a number of state courts and recently endorsed by the Eleventh Circuit in an adjacent area of law. Under traditional tort principles, injured plaintiffs are entitled to recover the “reasonable” costs of their medical expenses, regardless of whether they were covered by insurance. Reasoning that because, in the contemporary healthcare market, neither the amount billed by healthcare providers nor the amount paid by insurers is necessarily reasonable, these courts hold that the question of reasonable damages is for the jury, on consideration of the amount billed, the amount paid, and any other relevant evidence the parties present. A similar approach could be imported into the balance billing context, leaving to juries to determine the reasonable price of services, considering all relevant evidence. This wouldn’t solve all problems related to balancing billing, and the “reasonable price” determined by juries may still be out of reach of many patients. But unlike other judicial solutions, this proposal is thoroughly consistent with common law theory, translating basic private law principles to new contexts, rather than policy reasoning. Moreover, it may even improve the public legitimacy of the industry, ensuring that providers can never collect arbitrary post-facto amounts.
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