Protecting consumers from charges for out-of-network health services (Cody, Pollet)

Establishes the balance billing protection act. Addresses the charges for out-of-network health services.

The substitute bill:
-limits the nonemergency services for which balance billing is prohibited;
-requires carriers to calculate cost-sharing using the average contracted rate, rather than 125 percent of the amount Medicare would reimburse
-removes provisions establishing the rates for payment to out-of-network providers;
-removes the requirement that the arbitrator choose between the parties' final offers, provides factors for the arbitrator to consider, requires the fees to be divided equally (unless the Commissioner adopts a rule), requires the parties to sign a nondisclosure agreement, and requires the Commissioner to prepare an annual report;
-adds notification requirements for facilities, providers, and carriers; and
-applies the balance billing provisions to health plans offered to public employees and their dependents.

** Insurance Coverage of Emergency Services: Removes the requirement that the patient know of, and consent to, material misrepresentations that would allow an insurer to rescind coverage of emergency services.
** Balance Billing Prohibition: Prohibits balance billing for all non-emergency surgical or ancillary services provided in in-network hospitals and ambulatory surgical facilities by out-of-network providers, instead of only in cases where an in-network provider was unavailable or the need for the services was unforeseen.
** Cost Sharing Amounts: (1) Removes the requirement that an out-ofnetwork provider or facility request an explanation of benefits from the patient's insurer prior to billing him or her for in-network cost sharing amounts. (2) Requires the cost-sharing amount to be determined based on the insurance contract and the amount the provider was reimbursed, instead of on the insurer's median contracted rate. (3) Clarifies that the balance billing prohibition does not affect a provider's ability to collect past-due cost sharing amounts.
** Out-of-Network Provider Reimbursement: (1) Removes the reimbursement methodology that requires the amount an insurer reimburses to an out-of-network provider to be determined by paying the billed charges, mediation, or arbitration, depending on the billed amount. (2) Requires the All Payer Claims Database (APCD) to establish a data set and business process to provide information on prevailing payment and billed charges amounts. (3) Requires the insurer to pay the out-of-network provider the greater of: (a) the median allowed amount paid to in-network providers for the service as determined by the APCD data set, (b) the median amount paid to outof-network providers for the service as determined by the APCD data set, or (c) 175% of the Medicare rate.
** Arbitration: (1) Allows an insurer or an out-of-network provider to enter into arbitration to resolve any reimbursement dispute, instead of only disputes of $2,000 or more. (2) Requires the party seeking arbitration to first initiate an informal settlement process. (3) Requires arbitration to be initiated no more than sixty days after initiation of the informal settlement process, instead of no more than 90 days after the receipt of the explanation of benefits. (4) Allows arbitration claims to be bundled if they involve identical parties, involve claims with the same or related CPT codes, and occur within the same six-month period. (5) Clarifies that the claim may be settled at any time before the arbitration proceeding. (6) Holds a party who is unresponsive in the arbitration party in default and requires that party to pay the final offer and attorneys' fees of the nondefaulting party. (7) Changes the factors the arbitrator must consider by (a) removing gross disparity as a factor, (b) including the median payment amounts determined by the APCD data set, (c) including the median billed charge amounts as determined by the APCD data set, (d) including the time and place of the service and whether the service was delivered at a level I or II trauma center or a rural facility, (e) including the level of training, education, and experience of the provider. (8) Allows the arbitrator to consider other information a party believes is justified or factors requested by the arbitrator.
** Reporting/Notice Requirements: (1) Removes the requirement that hospitals and ambulatory surgical facilities provide notice to insurers about the network status of their contracted providers. (2) Removes the requirement that hospitals, ambulatory surgical facilities, and providers provide notice to patients regarding network status and balance billing. (3) Requires an insurer to update its web site and provider directory within 30 days after the addition or termination of a facility or provider, instead of only when the insurer had notice of the change. (4) Expands the information in the standard template to include information on balance billing protections and that they may be balanced billed in other circumstances. (5) Requires the Insurance Commissioner to adopt rules specifying when and how the standard template must be provided.
** Network Adequacy: (1) Requires the Insurance Commissioner, when determining the adequacy of provider networks, to consider whether an insurer's network includes a sufficient number of contracted providers practicing at the same facilities with which the insurer has contracted for the network to reasonably ensure that enrollees have in-network access for covered benefits delivered at the facilities. (2) Requires a hospital or ambulatory surgical facility to provide an insurer with information about the network status of nonemployed provider groups that provide services at the hospital or ambulatory surgical facility.
** Enforcement: (1) Changes the enforcing entity for provider and facility violations from the Insurance Commissioner to the Department of Health. (2) Requires the Insurance Commissioner to notify the Department of Health of possible violations. (3) Gives the Department of Health and health professions disciplining authorities the authority to levy fines if a report of a potential violation is substantiated. (4) Makes violations of balance billing protections unprofessional conduct under the Uniform Disciplinary Act. (5) Requires the Department of Health or the disciplining authority to notify the Insurance Commissioner of the results of a review.
** Intent Section: Inserts an intent section. Effective Date: Changes the effective date to January 1, 2019, instead of January 1, 2018.

EFFECT: (1) Adds a requirement that out-of-network provider payment is subject to prompt claim payment standards adopted by the commissioner. (2) Modifies the payment formula used when a carrier adjudicates a claim to note that the median in-network and out-of-network allowed amounts are based on data from a similar geographic area. Also adds language, so that in determining "median allowed amounts" for both in and out-of-network calculations, median allowed amount is the greater of the amount in the most recently updated APCD data set or the amount in the 2019 APCD data set, inflated annually by a health care inflation factor set by the insurance commissioner. (3) Removes the requirement that an in-person meeting be part of the informal settlement process. (4) Removes the requirement that a facility post on its web site the health plan networks that its nonemployed contracted provider groups participate in. Adds requirement that the facility disclose that nonemployed providers may not be in the same health plan provider network as the facility. It also requires the facility to provide carriers it contracts with, with a list of nonemployed providers under contract with the facility to provide surgical or ancillary services, within 30 days before signing a contract with a carrier. The facility must also notify the carrier within 30 days of a provider's removal from or addition to the list. (5) Clarifies that the OIC may report a potential violation to the DOH or disciplinary authorities, who then determine whether to investigate and to take any currently allowable informal or formal disciplinary action. (6) Clarifies that the APCD data set will be updated annually.

(1)Changes the date that the data set provided through the All Payer Claims Database must be made available from January 1, 2019, to November 1, 2018. (2) Changes the effective date of the legislation from January 1, 2019, to July 1, 2019.

Hearing Date: Saturday, February 24, 2018 -- 9:00 am

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