Passage of California surprise-bill legislation could spur other states to act

CAL/AAEM News Service at
Tue Sep 6 19:44:23 PDT 2016



September 1, 2016


Passage of California surprise-bill legislation could spur other states to



mpaign=financedaily> Modern Healthcare



By Harris Meyer


California medical consumers will enjoy strong new protection against
surprise out-of-network medical bills starting next July, under a
hard-fought bill overwhelmingly approved by the state legislature this week.
It's widely expected that Democratic Gov. Jerry Brown will sign it.


Under the bipartisan bill, AB 72 (PDF), authored by Democratic Assemblyman
Rob Bonta, patients who received care in in-network facilities would have to
pay only in-network cost sharing. This would apply just to non-emergency
care, since emergency physicians in California already are barred from
balance billing patients. The bill's provisions would not apply, however, to
self-insured employer health plans, which are shielded from state
regulations by the federal Employee Retirement Income Security Act.


Health plans would pay non-contracting physicians the plan's average
contracted rate or 125% of the Medicare rate, whichever is greater. Doctors
could appeal that through a binding independent dispute resolution process,
which the state Department of Managed Health Care will establish.


The bill, passed by the General Assembly on the last day of the legislative
session after months of tough negotiations, also tightens requirements on
health plans to offer adequate provider networks. A similar bill that would
have paid out-of-network doctors 100% of Medicare rates failed last year.


Florida enacted a similar law this year, joining New York, while Georgia and
other states are studying the issue or considering legislation. Observers
predicted the bipartisan passage of the California law would boost
legislative efforts in other states.


A recent Consumers Union survey found that one-quarter of Californians who
had hospital visits or surgery in the past two years were charged an
out-of-network rate when they thought their provider was in-network.


Insurers and other payers faced pressure to come up with a legislative
solution because shocker out-of-network bills have undermined public support
for narrow-network health plans, which have become a primary method of
keeping premiums affordable. But physician groups continued to hold out for
freedom to refuse to join networks and balance bill when they think plans
aren't offering adequate rates.


Earlier this week, the California Medical Association adopted a neutral
rather than an adversarial position on the bill while still expressing
concerns about whether it would reduce patients' access to physician
services. Groups representing plastic surgeons, cardiologists and
anesthesiologists strongly opposed the bill. The California Hospital
Association and the California Association of Health Plans did not declare a


"We understand that these are some of strongest consumer protections in
nation," said Anthony Wright, executive director of Health Access
California, which pushed for the bill.


Wright said there was an urgent need for this consumer protection because
more lower-income people are buying insurance and they can't afford a large
unexpected bill. "A surprise medical bill is not just an injustice but it's
financial destabilizing," he said. "If you're making $30,000 or $40,000 a
year, a surprise bill of $2,000 is next month's rent."




Jeff Wells
Deputy Editor, CAL/AAEM News Service


Brian Potts MD, MBA
Managing Editor, CAL/AAEM News Service

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