Hospitals are devoting plenty of resources to the logistics of how they are going to comply with new federal price transparency requirements.1 There also are important ethical implications.

“Several types of billing practices raise ethical issues,” says Katherine Drabiak, JD, an associate professor at USF Health’s College of Public Health and College of Medicine in Tampa.

Surprise billing probably is the most-publicized example. This usually happens when a patient visits an in-network hospital but an out-of-network physician handles treatment. “When visiting a physician, patients also expect billing to correspond to the level of care provided,” Drabiak says.

Some patients receive astronomical bills for minor items or services, such as bandages, tetanus shots, or aspirin. “This not only induces patient anxiety, it also raises questions about fair and transparent billing standards,” Drabiak notes.

The price transparency requirements, which took effect Jan. 1, 2021, are an opportunity for hospitals to demonstrate their financial practices are ethical. “Taking this step will increase the hospital’s goodwill in the community,” Drabiak predicts.

Generally, hospital-based physicians are focused on direct patient care as opposed to pricing and billing issues. Facilities really could use staff with insurance expertise to ensure patients are billed in an ethical manner. “Case managers could work in tandem with hospital administrators to assess billing practices and to ensure indigent patients are aware of their rights and payment resources,” Drabiak suggests.

Surprise billing is a major economic burden for some patients. “Such bills often revolve around surgery,” says Peter Angelos, MD, PhD, FACS, the professor of surgery and surgical ethics and associate director of the MacLean Center for Clinical Medical Ethics at The University of Chicago.

Perhaps a patient undergoes emergency surgery at an in-network hospital, but the on-call surgeon is out of network. The patient winds up with an expensive medical bill for the surgeon’s services. In other cases, both the surgeon and the hospital are in network, but not the anesthesiology group.

“The ethical implications of surprise billing are that patients face economic burdens that they had no way of knowing that they would be subject to,” Angelos explains.

Angelos worries surprise billing episodes may be more likely during the COVID-19 pandemic. When physicians are required to stay home because of COVID-19 exposure, hospitals are forced to bring in outside physicians for surgical care and anesthesiology services. Many might be outside patients’ insurance networks.

“Although surprise billing is not a new problem, with COVID, we believe that it will increasingly be an issue, given the need for medical centers to get outside physicians to cover services,” says Angelos, who recently co-authored a paper on this subject.2

Since patients have no idea of the surprise bill that is coming, they cannot make an informed decision on where to seek their medical care. “They are deprived of the ability to make a choice. In other words, their autonomy is not respected,” Angelos laments.

Anger over unexpected bills also can interfere with the patient/physician relationship. “Bringing the ethical issues to greater awareness within hospitals may serve to encourage a greater effort at developing policy solutions for the problem,” Angelos offers.

The first step in addressing any ethical problem is to verify it exists. “I would suggest that medical ethicists determine whether there are physicians rendering care at their hospitals who are not contracted as in network,” Angelos says.

If those arrangements are common, it is safe to assume patients are receiving surprise bills from those providers. “Pursuing policies to make such arrangements transparent to patients would be a big step in the right direction,” Angelos adds.


  1. CMS completes historic price transparency initiative. Oct. 29, 2020.
  2. Sheckter CC, Singh P, Angelos P, Offodile AC 2nd. Surprise billing in surgical care episodes: Overview, ethical concerns, and policy solutions in light of COVID-19. Ann Surg 2020;272:e264-e265.