The United States Senate is currently considering bipartisan legislation that would establish statutory limits on the financial exposure of certain patients to so-called “surprise” medical bills. The proposed legislation would amend the federal Public Health Service Act (at 42 U.S.C. § 300gg-19a) to prohibit surprise balance billing of patients receiving health care services in the following three situations: (1) Emergency services provided by a nonparticipating (i.e., out of network) provider in a nonparticipating facility; (2) Non-Emergency services following an emergency service at a nonparticipating facility; and (3) Non-Emergency services performed by a nonparticipating provider at a participating (in-network) facility. The proposed legislation would take effect during health plan years that begin on or after January 1, 2020.
Emergency services provided by a nonparticipating provider in a nonparticipating facility: The proposed legislation would prevent health care providers from balance billing a patient for payment beyond the cost-sharing amount required by the patient’s health plan. The patient’s health plan would be responsible for paying any amounts in excess of the cost-sharing amount in accordance with state law. If state law does not establish an applicable amount, the health plan would pay the greater of (i) the median in-network amount for the service charged by a provider in the same specialty and area, or (ii) 125 percent of the average allowed amount by insurers for the service for a provider in the same specialty and area.
Non-Emergency services following an emergency service from a nonparticipating facility: The proposed legislation would require hospitals and other facilities to inform a patient in writing, after the patient receives emergency services and is stabilized (as defined under EMTALA), that subsequent non-emergency services at the out-of-network facility may subject the patient to higher cost-sharing obligations, and that the patient has the option to transfer to an in-network facility. Patients would be required to provide a written acknowledgment of the notice before receiving additional services from the out-of-network facility.
Non-Emergency services performed by a nonparticipating provider at a participating facility: The proposed legislation prohibits a patient’s health plan or health insurer (group or individual coverage) from imposing a cost-sharing amount on the patient for such services in excess of the cost-sharing limit that would apply for the patient if the services were furnished by an in-network provider at the facility. The patient’s health plan would be responsible for paying the excess amount above the cost-sharing limit in accordance with applicable state law. In the event state law does not provide a mechanism for determining the amount, the legislation would require a health plan to pay the greater of (i) the median in-network amount for the service charged by a provider in the same specialty and area, or (ii) 125 percent of the average allowed amount by insurers for the service for a provider in the same specialty.
The legislation then contains a further prohibition which states that a provider “may not balance bill the patient for amounts beyond the cost-sharing amount allowed under” the above provisions.
Although the proposed legislation is still in a draft form, and is subject to change, it indicates a bipartisan interest in Congress to combat surprise bills and limit balance billing of patients by health care providers. Prior to this legislation, a number of states enacted prohibitions on surprise medical bills and balance billing in certain circumstances. For example, Connecticut enacted legislation that was effective July 1, 2016 that imposes similar limits on surprise bills to those now proposed at the federal level (see here for our previous analysis of the Connecticut law).