Requires health insurance companies that offer preferred provider organization plans to pay out-of-network health care providers directly for health care services provided to policy holders.

A BILL FOR AN ACT

SECTION 1. The legislature finds that health care providers are not always being reimbursed for health care services they provide to patients. Preferred provider organization (PPO) plans offer flexibility to policy holders by allowing them to choose professional services from out-of-network health care providers. When a policy holder receives health care from an out-of-network provider, the usual practice has been that the insurance company pays the policy holder rather than the provider. In some cases this practice has resulted in health care providers not being paid for their services because the policy holder keeps the money.

The purpose of this Act is to require health insurance companies that offer preferred provider organization plans to pay the out-of-network health care provider directly.

SECTION 2. Chapter 431, article 10A, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§431:10A-   Preferred provider organization plan; direct payment. (a) All accident and health or sickness insurance policies issued in the State that offer a preferred provider organization plan shall pay out-of-network health care providers directly for health care services provided to a policy holder.

(b) For the purposes of this section:

"Preferred provider organization" means a partnership, association, corporation, or other entity that delivers or arranges for the delivery of health services, and that has entered into a written service arrangement or arrangements with health professionals, a majority of whom are licensed to practice medicine or osteopathy."

SECTION 3. Chapter 432, Article 1, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§432-   Preferred provider organization plan; direct payment. (a) All individual and group hospital and medical service corporation contracts that offer a preferred provider organization plan shall pay out-of-network health care providers directly for health care services provided to a policy holder.

(b) For the purposes of this section:

"Preferred provider organization" means a partnership, association, corporation, or other entity that delivers or arranges for the delivery of health services, and that has entered into a written service arrangement or arrangements with health professionals, a majority of whom are licensed to practice medicine or osteopathy."

SECTION 4. New statutory material is underscored.

SECTION 5. This Act shall take effect upon its approval.