Legislators in nine states have advanced out-of-network legislation that would introduce terms, require informing patients with disclosures and dictate reimbursement amounts for out-of-network and in-network providers.
Bills in Oklahoma, Michigan, South Carolina and Vermont would mandate that reimbursements for out-of-network providers be the greater of the average amount the enrollee’s health care plan would pay an in-network provider, a reasonable and customary rate for similar services. For legislation under consideration in Oklahoma and South Carolina, reimbursement would be based on Medicare rates. Michigan would allow the option of 150% of the Medicare reimbursement amount.
In New Jersey, the Health Care Facilities Medical Bill Dispute Resolution Program would review cases in arbitration. Its decisions would establish a reasonable reimbursement amount of the balance due to be paid or deny payment if the balance does not meet the criteria defined in the bill.
In Delaware, HB 286 was referred to the House Health and Development Committee. The bill would mandate insurers cover enrollees for “inadvertent out-of-network services” in addition to emergency care services performed by out-of-network providers at an agreed-upon rate, regardless of whether the provider has a contractual arrangement with the insurer. An inadvertent out-of-network service would be defined as:
- Health care services covered under a policy or health insurance contract provided by an out-of-network provider in an in-network facility or when in-network health care services are unavailable or not made available to the enrollee in the facility; and
- Laboratory testing ordered by an in-network provider and performed by an out-of-network laboratory.
In Florida, HB 959 would require licensed facilities to provide, in writing or electronically, a good faith estimate of reasonably anticipated charges by the facility for a patient’s treatment or specific condition. The estimate would be provided to the patient or prospective patient upon scheduling a medical service, upon admission to the facility, or before providing elective medical services on an outpatient basis. It would prohibit facilities from charging enrollees more than 110% of the estimate. If the facility determines such charges are warranted, the facility must provide the patient with a written explanation of the excess charges as part of the itemized statement to the patient.
Facilities would also be required to establish an internal process for reviewing and responding to patients’ grievances regarding statement charges. The facility would be required to provide an initial response to a patient grievance within seven business days after the patient formally files a grievance.
The bill passed the House Health Market Reform Subcommittee and was referred to the House Health Care Appropriations Subcommittee.
(a) When an enrollee receives emergency services from an out-of-network provider, the provider would be prohibited from billing the enrollee, insurer or any other entity any amount in excess of any applicable charges the provider would be entitled to charge a Medicare enrollee who receives such services, including, without limitation, any copayment, coinsurance or deductible that would be owed by a Medicare enrollee to the out-of-network provider for the services
(b) The out-of-network provider would accept payment of the amounts under subsection (a) as payment in full for the emergency services rendered.
(c) To the extent that the emergency services are covered under the enrollee's managed care plan, any liability the managed care plan may have for the services shall not exceed the amount the out-of-network provider is entitled to bill under this section.
(d) A health care provider or facility shall bill an insurer only for a health intervention service that is a medical necessity. The health care provider or facility shall not bill or otherwise attempt to collect from an enrollee any amount not paid by a health carrier for a health intervention service that is a medical necessity, other than an applicable copayment, coinsurance or deductible.
(e) An out-of-network provider means a facility, health care provider or health care professional that is not subject to a written agreement with the enrollee's insurer governing the provision of emergency services.
The House bill was referred to the individual House Committees on Finance, Consumer Protection and Commerce, and Health. The Senate version was referred to the Senate Committee on Commerce, Consumer Protection, and Health.
Also in Hawaii, HB 2504 and companion legislation SB 2778 would require health care providers, facilities and hospitals to disclose in writing to patients prior to administering elective services that are not covered under the enrollee’s health care plan the following items:
- A notification that certain health care facility-based health care providers may be requested to render care to an enrollee during treatment;
- A statement that the provider may not have contracts with the enrollee’s insurer and therefore considered to be out-of-network providers;
- A notification that the services provided would be out-of-network and the cost may be substantially higher than in-network services;
- A notification that the covered person may opt to accept and pay the charges for the out-of-network services or elect remedies available under state or federal law; and
- A statement indicating that the enrollee may obtain a list of in-network providers and request a provider from that list.
Out-of-network providers would be required to disclose to the patient in writing the estimated amount the provider would bill the patient for elective services and obtain consent from the patient at least 24 hours prior to providing the services. If a provider does not obtain a signed consent form, the insurer would reimburse the out-of-network provider the greater of the usual and customary rate for similar services or the Medicare reimbursement amount for a similar service in the general geographic area.
The House version was referred to the individual U.S. House Committees on Financial Services, Consumer Protection and Commerce, and Health. The Senate bill was referred to the Senate Committee on Commerce, Consumer Protection, and Health and the Committee on Judiciary.
In Idaho, HB 341, or the “No Surprises Act,” was referred to the House Health and Welfare Committee. The bill would prohibit in-network providers from seeking reimbursement for services that exceeds:
- Payment by the enrollee’s insurer for a covered service of the amount the insurer would pay to an in-network provider for a similar service at the same time in a similar geographic area; and
- Payment by the patient’s coinsurance, deductible and copayment for an in-network provider at an in-network facility in the enrollee’s health benefit plan.
In Michigan, SB 570 and SB 572 would amend the state’s Public Health Code. In the event a patient is receiving emergency care by an out-of-network provider, SB 570 would reimburse out-of-network providers the greater of:
- The average amount negotiated by the enrollee’s health care plan with in-network providers excluding in-network coinsurance, copayments or deductibles; or
- 150% of the Medicare reimbursement amount, excluding in-network coinsurance, copayments or deductibles.
SB 572 would amend the code by requiring out-of-network providers to provide patients receiving elective services with a disclosure and obtaining the patient’s consent. The provider would also be required to provide the patient with a good faith estimate of the health care services when providing the disclosure. Providers who do not provide a disclosure would be reimbursed the greater of the average amount negotiated by a health care plan for in-network providers for the service provided or 150% of the Medicare reimbursement rate. The Senate will hold a second reading on both legislation.
In New Jersey, AB 547 would require providers to disclose to patients whether the provider is in-network for an elective service. If the patient elects an out-of-network provider, that provider would deliver a written cost estimate of the service and would be required to obtain the enrollee’s consent to pay any balance in excess of their insurer’s payment. Once the patient’s elective service is scheduled, the provider would be required to provide the name and contact information of any provider who will be rendering services to the patient.
In the event of a dispute for out-of-network billing, the Health Care Facilities Medical Bill Dispute Resolution Program would review each case. The decision would establish a reasonable reimbursement amount of the balance due to be paid or deny payment if the balance does not meet the criteria defined in the bill. The bill was referred to the Assembly Committee on Financial Institutions and Insurance.
In Oklahoma, SB 1868 would prohibit out-of-network providers from charging enrollees greater out-of-pocket costs for emergency services than the enrollee would have incurred with an in-network provider. In the event an enrollee receives emergency services by an out-of-network provider, the insurer would pay the provider the greater of:
- The Medicare rate;
- The in-network rate; or
- The usual, customary and reasonable rate.
The usual, customary and reasonable rate is defined as the eightieth percentile of all charges for the particular health care service performed by a provider in the same or similar specialty and provided in the same geographical area as reported in an independent benchmarking database maintained by a nonprofit organization to be specified by the state insurance commissioner. In the event a health care facility or administrator bills an enrollee an amount greater than the applicable copayment, coinsurance and deductible amount as stated in the bill, the attorney general may bring a civil action on the enrollee’s behalf. In the event an enrollee with out-of-network benefits elects to receive covered elective services at an out-of-network facility from an out-of-network provider, the insurer would pay the provider and facility the usual, customary and reasonable rate or an agreed upon rate. In the event of a dispute, and the insurer and provider do not mutually agree on an arbitrator, the insurance commissioner would select an arbitrator. The arbitrator would determine if the charge of the provider is reasonable, or, if the usual, customary and reasonable rate paid by the insurer is unreasonable and would select the amount determined to be the closest as the binding award.
In South Carolina, HB 5013 was referred to the House Labor, Commerce and Industry Committee. In the event an enrollee receives emergency services, including laboratory tests and services from an out-of-network provider, the bill would mandate that insurers reimburse the provider the greater of:
- The amount the enrollee’s health care plan would pay for similar services if rendered by an in-network provider;
- The usual, customary and reasonable rate for similar services; or
- The Medicare reimbursement rate.
An insurer and out-of-network provider would be allowed to agree to a greater reimbursement amount.
In the event the patient receives a surprise bill, the insurer would reimburse the out-of-network provider for services rendered at the in-network rate under the enrollee’s health care plan, unless the insurer and provider agree otherwise.
In Vermont, HB 825 was referred to the House Health Care Committee. It would prohibit contract provisions between a health plan and health care provider that would transfer liability related to the cost of care by in-network or out-of-network providers to the health care provider. It would also prohibit provisions that impose responsibility on a provider for informing enrollees about the in-network status of the provider.
For emergency and elective services rendered to an enrollee by an out-of-network provider, a health plan:
- Would not require an enrollee to pay a cost-sharing amount for the services greater than the same services provided by an in-network provider; and
- Would pay the provider rendering the services the reasonable and customary value for services provided.
Regarding out-of-network billing, the American College of Radiology® urges that patients be protected and only responsible for in-network cost-sharing amounts when receiving unanticipated medical care. Insurers should provide physicians with direct payment/assignment of benefits, thereby preventing patients from being in the middle. After rendering out-of-network medical care, a reasonable payment (determined by the health plan if a fully accessible independent dispute resolution process is available) should be paid directly to providers.
If the provider determines that the insurer’s payment is not reasonable, there must be a fair, accessible and equitable independent dispute resolution process to resolve payment disputes. The process must not be restricted to claims above a specific dollar amount threshold. An independent and transparent commercial insurance claims database should be established and must include data from employee-sponsored (ERISA) health insurance plans to ensure it truly reflects the market. Health plans should be held accountable for provider networks that are appropriate to meet patients’ medical needs — including ensuring access to specialists and subspecialists on a timely basis. Health plans must also ensure that that provider directories are up-to-date and accurate. Patients must be allowed to access elective out-of-network care when they so choose.