ASA and Physician Coalition Win Improved Model NCOIL Out-of-Network Legislation

On November 19, the National Conference of Insurance Legislators (NCOIL) adopted an Out-of-Network Balance Billing Transparency Model Act during its Annual Meeting in Phoenix. ASA, working closely with the College of American Pathologists, the American College of Radiology, Physicians for Fair Coverage, and others successfully secured language within the Act which recognizes the needs of physicians and their patients. The model language is a win for organized medicine. While the Act is not perfect, it represents the extraordinary efforts of ASA and others to educate lawmakers and move past the insurance companies’ narrative of “surprise bills” to the more accurate representation of “surprise insurance gaps” experienced by patients.

The Model Act will be helpful as states consider out-of-network legislation in 2018 and beyond. This year, the Department of State Affairs reviewed roughly 200 initiatives (legislation and regulation) pertaining to out-of-network. These initiatives ranged from network adequacy requirements to cost estimates delivered to patients prior to procedures to prohibitions against balance billing.

Texas State Representative Tom Oliverson, M.D. (R-130), an ASA member, served on a key panel during discussions on the Act and advocated strongly for the improved patient-friendly model legislation. Key components of the Act include:

• Application to all providers of the services rendered. Such language is critical because when specified physician types are the sole focus, patients continue to receive “surprise bills” from other physicians that provide the service or practitioners like nurse anesthetists.
• Defines usual, customary, and reasonable (UCR) rate as the 80th percentile of all charges for the particular health care service performed by a provider in the same or similar specialty and provided in the same geographical area as reported in a benchmarking database maintained by a nonconflicted, nonprofit organization specified by the commissioner. Recommends payment for out-of-network services at 80% of the UCR rate.
• Requires a health benefit plan that contracts with a network of health care providers to ensure an adequate network including within in-network health care facilities.
• Ensuring that when enrollees receive emergency services from an out-of-network provider, she/he will incur no greater out-of-pocket costs than with an in-network provider.
• Empowering enrollees that request, after pre-certification for a non-emergency service, to receive within 48 hours from their health benefit plan necessary information -- such as whether the enrollee’s provider is in-network; whether the care is covered by the health benefit plan; and the insured's personal payment responsibility.
• An Independent Dispute Resolution program for disputed out-of-network charges, including balanced bills which takes into account the provider’s level of training, education and experience; the provider’s or health care facility usual charge for similar care in non-participating situations; the complexity and circumstance of the case -- including time and place of care; and the UCR rate of the service.

Congratulations to Sherif Zaafran, M.D., FASA, Chair, ASA’s Ad Hoc Committee on Out-of-Network Payment, the physician leaders, and staff of the national medical specialties who worked tirelessly on this achievement. NCOIL will post the adopted language soon on its website under Model Laws and Resolutions.