Four states — Colorado, New Mexico, Texas, and Washington — began 2020 with new laws governing balance billing, or surprise medical bills.
By Michael Tetreault, Editor-in-Chief
Several states have explored ways to protect consumers from these surprise bills.
“Direct Primary Care (DPC) has a voice, particularly on social media. At the heart of many DPC practices is the spirit in which it [DPC] wants to impact a patient’s pocketbook and help them save people money on their healthcare expenditure. Patients still may have out-patient and elective surgery needs that DPC cannot fulfill in the primary care office. Right now, only sixteen States have passed comprehensive Balance-Billing Protection Laws according to the July update from the Commonwealth Fund. Only Fourteen have passed “partial” laws. Nearly every Patient treated and recovering today knows how it feels to receive one [or many] of these bills. It’s a stressful and albeit almost normal part of recovery process. That’s not fair, right? So what if it [DPC] took some of that vocal energy and directed it towards balance-billing protections on behalf of patients in their State? Imagine the financial impact that would and could have on communities. DPC can use it’s voice to impact, influence and advocate for patient rights (and their pocketbooks) and help to educate your State law makers. Just a thought.”
~Editor, The DPC Journal
Gov. Kemp Signs Landmark Healthcare Legislation
July 17, 2020
Atlanta, GA – Governor Brian P. Kemp today signed several pieces of legislation to ensure a safer and healthier Georgia. Among the bills signed at a ceremony at Wellstar Kennestone Hospital were bills to reduce surprise medical billing (HB 888) and address Georgia’s maternal mortality rate by enhancing access to quality and timely care for mothers on Medicaid (HB 1114).
“This is a historic step forward for Georgia when it comes to healthcare, and frankly, it couldn’t come at a better time – as our state and country face the greatest public health challenge we have seen in the 21st Century,” said Governor Kemp. “When we began 2020, none of us could have predicted that we would face a pandemic and grapple with unprecedented threats to the lives – and livelihoods – of all Georgians.”
“We have faced sobering moments together, but today is a bright spot as we continue to streamline bureaucracy, increase access to care, insist on transparency and fairness, improve health outcomes, and put Georgia families first. I am grateful for the hard work of the General Assembly along with our partners in the medical field, frontline heroes, and local leaders to champion these much-needed reforms as we work to build a safer, stronger Georgia.”
HB 888 – Reduction of Suprise Medical Billing: HB 888 is a bi-partisan reform that puts patients ahead of the status quo and provides a fair process for billing that medical providers and insurers can agree on.
HB 1114 – Postpartum Medicaid Extension: HB 1114 provides for an additional four months of Medicaid coverage for mothers on Medicaid, bringing total coverage to six months. Coupled with other investments, HB 1114 will dramatically improve health outcomes for Georgia mothers.
During the ceremony at Wellstar, Governor Kemp also signed the following legislation: HB 521, HB 578, HB 789, HB 932, SB 28, and SB 395.
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State Balance-Billing Protections
Last updated on July 20, 2020.
“Balance bills” primarily occur in two circumstances: 1) when an enrollee receives emergency care either at an out-of-network facility or from an out-of-network provider, or 2) when an enrollee receives elective nonemergency care at an in-network facility but is inadvertently treated by an out-of-network health care provider. Since the insurer does not have a contract with the out-of-network facility or provider, it may decide not to pay the entirety of the bill. In that case, the out-of-network facility or provider may then bill the enrollee for the balance of the bill. No federal law currently limits this practice, but 30 states have enacted laws to protect enrollees from it.
Source: M. Kona, et al, Center on Health Insurance Reforms, Health Policy Institute, Georgetown University. Please contact Maanasa Kona for questions about this map.
- Jack Hoadley and Maanasa Kona, “How States Are Using Independent Dispute Resolution to Resolve Out-of-Network Payments in Surprise Billing,” To the Point (blog), Commonwealth Fund, February 27, 2020.
- Maanasa Kona, Jack Hoadley, and Katie Keith, “Addressing Surprise Billing by Setting Payment Standards for Out-of-Network Providers,” To the Point (blog), Commonwealth Fund, February 27, 2020.
- Jack Hoadley, Beth Fuchs, and Kevin Lucia, “Update on Federal Surprise Billing Legislation: New Bills Contain Key Differences,” To the Point (blog), Commonwealth Fund, February 20, 2020.
- Jack Hoadley, Kevin Lucia, and Maanasa Kona, “States Are Taking New Steps to Protect Consumers from Balance Billing, But Federal Action Is Necessary to Fill Gaps,” To the Point (blog), Commonwealth Fund, July 15, 2019.
What is a Surprise Bill or Balance Bill?
Have you ever been to the emergency room at a hospital, thought you were covered by your insurance and ended up with a bill that didn’t seem quite right? There’s a pretty good chance that you have. According to one study, 1 out of 5 trips to the ER includes a treatment by an out-of-network doctor, and that’s what leads to surprise bills.
Counteracting Surprise Medical Billing
By Colleen Becker | Vol . 27, No. 11 | March 2019
Several states have explored ways to protect consumers from these surprise bills. Researchers at the Georgetown University Center for Health Insurance Reform (CHIR) issued reports in 2017 and 2019 detailing how state have addressed surprise bills. Based on four indicators, CHIR rated states on how they:
- Extend consumer protections to include both emergency department and in-network hospital settings
- Apply laws to all types of insurance, including both Health Maintenance Organizations (HMOs) and Preferred Provider Organizations (PPOs)
- Protect consumers both by holding them harmless from extra provider charges—meaning they are not responsible for the charges—and prohibiting providers from balance billing
- Adopt an adequate payment standard to determine how much the insurer pays the provider or to establish a process to resolve payment disputes between providers and insurers.
In 2017, the researchers found more than half of states did not have any laws in place protecting consumers from balance billing and only six states had comprehensive balance billing statutes. Now, 18 months later, the experts at CHIR found that nine states now have comprehensive consumer protection laws against surprise billing. Moreover, four states—Arizona, Maine, Minnesota and Oregon—adopted their first-ever balance billing laws during the 2018 session.
First in the nation, New York requires that plans must not only come up with a “reasonable” payment amount, but also show how the amount compares to ”usual and customary” rates. These rates are defined as the 80th percentile of all charges for a health care service. If any party is dissatisfied, they can appeal the amount through an independent dispute resolution process.
Acknowledging this issue, the National Association of Insurance Commissioners (NAIC) amended their Health Benefit Plan Network Adequacy and Access Model Act to include some patient protections against balance billing. NAIC model acts are not enforceable by law, but often give states a roadmap for legislative action. To date, four states—Colorado, Georgia, Hawaii and Maryland—have adopted the revised model act.
Although states have autonomy within their borders, current state laws do not apply to the roughly 60 percent of privately insured Americans enrolled in “self-insured” health plans most common among large employers. In self-insured plans, the employer assumes the financial risk for providing health care benefits to its employees. These plans are regulated by the federal law known as the Employee Retirement Income Security Act (ERISA). Only federal action can protect people guarded by ERISA.
Although surprise billing is not a new concern among federal lawmakers, the Trump administration has pledged it would be a top priority moving forward. The subject is also gaining renewed attention among congressional leaders. Both the Senate Finance and Senate Health, Education, Labor and Pensions committees, as well as the House Ways and Means Committee, are investigating the issue. During the 2018 session, four senators proposed separate legislation, including a bipartisan proposal led by U.S. Senator Chuck Grassley (R-Iowa). One of the most critical aspects of the draft proposal, titled “Protecting Patients from Surprise Medical Bills Act,” is that it would protect people in the ERISA-covered population.
Four States Start 2020 with New Surprise Billing Laws