September 02, 2020

States Deliberate Out-Of-Network Billing Legislation

State legislatures in Michigan and Pennsylvania consider bills in hearings and on the House floor, respectively, that would modify reimbursement and arbitration requirements on out-of-network billing. Maine releases a proposed rule establishing its arbitration process for out-of-network-billing.

Out-Of-Network Billing

In Maine, the Bureau of Insurance issued proposed rule 2020-11934, which outlines the process for the state’s Independent Dispute Resolution process established by its law on out-of-network billing (An Act To Protect Consumers from Surprise Emergency Medical Bills). The proposed rule applies to the provider who has performed emergency services to an eligible patient or who has performed emergency services on an out-of-network basis to a patient covered by a carrier's health plan and is unable, in good faith, to negotiate agreement with the carrier on the payment amount within 30 calendar days.

Comments on the proposed rule must be received by Sept. 8, 2020

In Michigan, HB 4459 and companion bill HB 4460 were scheduled for a hearing before the Senate Committee on Insurance and Banking. The bills would require out-of-network emergency medical personnel who provide a covered emergency or elective service to be reimbursed at 150% of the amount covered by Medicare for the service, excluding any in-network coinsurance, copayments or deductibles. An out-of-network provider of an emergency service or of an elective service would not collect from the enrollee, directly or indirectly, any excess amount other than applicable coinsurance, copayments or deductibles. In the event of a dispute, providers and carriers may proceed to arbitration wherein each party would pay half of the total costs of the arbitration proceeding conducted by the state’s Department of Insurance and Financial Services.

In Pennsylvania, the House floor will consider H 1862. The bill would reimburse out-of-network providers for a covered service at the commercially reasonable rate for that service. That rate would be the median, in-network, contracted rate under the applicable policy that the issuer would pay to an in-network provider minus the in-network cost sharing for the service. It would prohibit out-of-network providers from billing enrollees for the difference between the provider’s charge and the amount of the commercially reasonable rate paid by the issuer for the service. In the event of a dispute, an arbitration process would be administered by the American Arbitration Association under its Healthcare Payor Provider Arbitration Rules.