Summary
On May 14, 2015, four New Jersey legislators introduced the Out-of-Network Consumer Protection, Transparency, Cost Containment and Accountability Act (the "Legislation"). If enacted, the Legislation would increase health care pricing transparency and provide advance notice to patients of possible out-of-network charges. The Legislation affects health care facilities, health care providers and health care payors.
The Legislation requires health care facilities and health care providers to provide a patient with a written disclosure form thirty days prior to a non-emergency or elective procedure (or upon scheduling if the procedure is to occur in less than thirty days) advising the patient of whether the facility or provider is in-network or out-of-network. Health care facilities and health care providers would be required to provide the patient with a "clear and understandable" description of the procedure; a reasonable estimate of the costs to be charged for those services; information, if available, on all other costs related to the procedure; and notice to the patient to contact his or her insurer for further consultation relating to the procedure costs. Health insurers are required to disclose to patients in writing at the time of enrollment a list of their in-network providers, which list must be updated at least every twenty days.
The Legislation places limits on amounts that out-of-network health care facilities and health care providers may charge for services provided on an emergency or urgent (not defined in the Legislation) basis and for "inadvertent" services (defined in the Legislation as services that are covered by the patient’s plan and provided by an out-of-network provider at an in-network facility when in-network services are unavailable in the facility).
In addition to the disclosure requirements and limitations on charges, the Legislation, if enacted as drafted, would do the following:
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Create a Healthcare Price Index that would publish information about the costs of in-network services;
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Institute a binding arbitration process for certain emergency and out-of-network billing disputes between providers and carriers; and
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Make it illegal for a health care provider to knowingly waive, rebate, give, pay or offer to waive, rebate, give or pay all or a portion of the patient’s deductible, co-pay, or co-insurance as an inducement for the patient to obtain health care services from the provider.
The Legislation includes financial penalties for violations as well as the potential for administrative action by appropriate regulatory agencies.
Saul Ewing attorneys will continue to monitor the status of the Legislation.
Transparency and cost certainty remain important components in the health care delivery system. The Legislation attempts to have stakeholders – facilities, providers and payors – communicate this information to patients in a timely manner.
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