March 05, 2020

“Surprise Billing” Legislation Moves Ahead in Nine States

Out-of-network billing remains a significant issue, with nine state legislatures pushing ahead with legislation that stipulate payment standards for out-of-network providers.

Bills in Georgia and Hawaii have passed their respective chambers, and Colorado’s bill has reached the governor’s desk.


In Colorado, SB 43 passed both chambers and was sent to Gov. Jared Polis for his signature. It would change the reimbursement rate for out-of-network providers as follows:

  • 105% to 110% of the insurer’s average in-network rate for that service in the same geographic area, or
  • 60th percentile of the in-network rate instead of the previous median in-network rate for the same service in the same geographic area.

The provider would be reimbursed the greater of the above options.


In Connecticut, SB 323 is scheduled for a hearing before the Joint Committee on Insurance and Real Estate. For emergency service performed by an out-of-network provider, the bill would allow carriers to impose a copayment greater than the copayment for an emergency service by an in-network health care provider.


HB 888, which passed the Georgia House chamber, will be reconciled with S 359, which passed the Senate. When an enrollee receives emergency medical services from an out-of-network provider, the bills would require the provider to collect no more than the enrollee’s deductible or other cost-sharing amount as determined by the enrollee’s policy. The carrier would pay the provider the greater of:

  • The verifiable contracted amount paid by all carriers for similar services,
  • The most recent verifiable amount agreed to by the carrier and out-of-network provider for the services, or
  • A higher amount as the carrier deems appropriate.

If the out-of-network provider concludes that payment from the carrier is not sufficient, the provider or facility may request arbitration with the insurance commissioner.

Also in Georgia, S352 passed the Senate and had a second reading in the House. If a carrier’s provider directory includes a provider as a participating provider for a network plan, the carrier would cover the provider charges at in-network rates for the enrollee, regardless of whether such provider remains a participating provider in the carrier’s network plan. The enrollee would not be responsible for more than the amount for which he or she would have been responsible had the services been delivered by an in-network provider under the network plan.


In Hawaii, 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:

  • That certain facility-based, health care providers may be requested to render care to an enrollee during treatment,
  • That the provider may not have contracts with the enrollee’s insurer and therefore considered to be out-of-network providers:
    • 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 bill passed the Senate chamber and was sent to the House.


 In Louisiana, SB 262 was referred to the Senate Insurance Committee. In the event of emergency services from an out-of-network provider, the bill would require carriers to pay the out-of-network provider the billed amount or attempt to negotiate reimbursement. If there is not a resolution of the payment dispute, the carrier would pay the provider an amount the carrier determines is reasonable for the health care services rendered. An out-of-network provider or carrier may request resolution of a dispute regarding a fee or payment for emergency services by an independent dispute resolution entity.


In Missouri, SB 944 was referred to the Senate Committee on Insurance and Banking. It would modify the definition of “unanticipated out-of-network care” to include patient referrals or transfers from an in-network provider to an out-of-network provider in life-threatening conditions.

New Jersey

In New Jersey, AB 3526 was referred to the Assembly Committee on Financial Institutions and Insurance. When an out-of-network provider provides an emergency service, the legislation would require carriers to pay at least the amount set by the 85th percentile of the FAIR Health Charge Benchmark database for the particular health care service performed by a provider in a similar specialty in the same geographical area. If there is a payment dispute, the carrier, provider or enrollee may initiate binding arbitration within two years of the provision of the health care service.


In Oklahoma, HB 3388 and HB 3368 passed the House Insurance Committee. HB 3388 would require the insurer to pay the provider the greater of the following amounts for out-of-network emergency services:

  • The Medicare reimbursement rate,
  • The in-network rate, or
  • The usual, customary and reasonable rate.

It would define the usual, customary and reasonable rate as 80th percentile of all charges for the particular health care service performed by a provider in a similar specialty in the same geographical area as reported in an independent benchmarking database maintained by a nonprofit organization specified by the insurance commissioner.

In the event of a payment dispute, the provider, facility or insurer may request arbitration. The arbitrator would be required to submit a written decision within 51 days of receiving the arbitration request.

In the event covered health care benefits are assigned to an out-of-network provider, HB 3368 would require the carrier to directly compensate the provider according to the carrier’s policy. The provider would accept the compensation as payment in full and not balance bill the enrollee.


In Virginia, SB 172 passed the House Appropriations Committee. It would require insurers to reimburse out-of-network providers who provide emergency services the market-based value for such services. If a resolution is not reached between the out-of-network provider and the carrier, either party may request the Commission’s Bureau of Insurance to review the disputed reimbursement amount.