THE SENATE |
S.B. NO. |
2278 |
THIRTIETH LEGISLATURE, 2020 |
S.D. 1 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
RELATING TO HEALTH INSURANCE.
BE IT
ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The legislature finds that patients with health insurance who receive treatment from an out-of-network provider may be subject to the practice known as "balance billing" or "surprise billing", where the provider bills the patient for the difference between what the patient's health insurance chooses to reimburse and what the provider chooses to charge. These bills occur most often when patients inadvertently receive medical services from out-of-network providers, such as when a patient is undergoing surgery and is not informed that a member of the medical team is not a participating provider in the patient's health insurance's provider network, or when a patient is in need of emergency services and is taken to the nearest medical facility, regardless of the facility's or its providers' network status. Out-of-network providers may not have a contracted rate with a health insurer for services; therefore, the prices these providers may charge may be much greater than the price charged by in-network providers for similar services.
The legislature further finds that balance bills or surprise bills can be an unwelcome shock to patients
who may have unknowingly received health care services
outside of their provider network. These unexpected medical bills are a major
concern for Americans. According to a
September 2018 Kaiser Family Foundation poll, two-thirds of respondents said
they were "very worried" or "somewhat worried" that they or
a family member would receive a surprise bill.
In fact, these bills are the most-cited concern related to health care
costs and other household expenses.
Furthermore, out-of-network bills sent to health insurers or carriers
from physicians can be more than thirty times the average in-network rate for
those same services.
Currently, there is no comprehensive
protection from surprise bills or balance bills at the federal level and, while
there is a growing trend toward state action to protect patients from surprise
bills or balance bills, most state laws do not provide comprehensive
protections. However, the trend is changing. At least nine states including California,
Oregon, Maryland, Connecticut, Illinois, New York, New Hampshire, New Jersey,
and Florida have enacted comprehensive approaches to end balance billing and
surprise bills. Similarly, New Mexico, Texas,
Washington, and Colorado passed new comprehensive laws in 2019. Hawaii patients continue to be at risk of
being caught in the middle of balance billing disputes between health insurers
and providers or being hit with significant surprise bills.
The purpose of this Act is to:
(1) Specify the circumstances in which a patient shall not be liable to a health care provider for any sums owed by an insurer, mutual benefit society, or health maintenance organization;
(2) Specify rate at which a health insurance plan must reimburse a nonparticipating provider who provides health care to a patient, unless otherwise agreed to by the nonparticipating provider and the health insurance plan;
(3) Require health insurance payors to use a transparent, third-party database on which to calculate out-of-network provider reimbursements for emergency services; and
(4) Require mandatory mediation to resolve disputes between insurers and providers to be overseen by the insurance division of the department of commerce and consumer affairs.
SECTION 2. Chapter 431, Hawaii Revised Statutes, is amended by adding two new sections to article 10A be appropriately designated and to read as follows:
"§431:10A-A Balance billing; hold harmless; emergency
services; mandatory mediation. (a) Every contract between an insurer and a
participating provider of health care services shall be in writing and shall
set forth that in the event the insurer fails to pay for health care services
as set forth in the contract, the insured shall not be liable to the provider
for any sums owed by the insurer.
(b) If a contract with a participating provider
has not been reduced to writing as required by subsection (a), or if a contract
fails to contain the required prohibition, the participating provider shall not
collect or attempt to collect from the insured sums owed by the insurer. No participating provider, or agent, trustee,
or assignee thereof, may maintain any action at law against an insured to:
(1) Collect sums
owed by the insurer; or
(2) Collect sums in
excess of the amount owed by the insured as a copayment, coinsurance, or
deductible under the insured's policy of accident and health or sickness insurance.
(c) When an insured receives emergency services
from a provider who is not a participating provider in the provider network of
the insured, the insured shall not incur greater out-of-pocket costs for
emergency services than the insured would have incurred with a participating
provider of health care services. No
nonparticipating provider, or agent, trustee, or assignee thereof, may maintain
any action at law against an insured to collect sums in excess of the amount
owed by the insured as a copayment, coinsurance, or deductible under the
insured's policy of accident and health or sickness insurance.
(d) When an insured receives emergency services from
a provider who is not a participating provider in the provider network of the insured,
the insurer shall use data from a transparent, third-party database upon which to
calculate out-of-network reimbursements for emergency services.
(e) Any dispute between an insurer and provider that
arises pursuant to this section shall be submitted to mandatory mediation to be
overseen by the insurance division.
(f)
For purposes of this section:
"Emergency condition"
means a medical or behavioral condition that manifests itself by acute symptoms
of sufficient severity, including severe pain, such that a prudent layperson,
possessing an average knowledge of medicine and health, could reasonably expect
the absence of immediate medical attention to result in:
(1) Placing the
health of the person afflicted with the condition in serious jeopardy;
(2) Serious
impairment to the person's bodily functions;
(3) Serious
dysfunction of any bodily organ or part of the person; or
(4) Serious
disfigurement of the person.
"Emergency services"
means, with respect to an emergency condition:
(1) A medical
screening examination as required under section 1867 of the Social Security
Act, title 42 United States Code section 1395dd; and
(2) Any further
medical examination and treatment, as required under section 1867 of the Social
Security Act, title 42 United States Code section 1395dd, to stabilize the
patient.
§431:10A-B Balance billing; hold harmless; non-emergency services. No nonparticipating health care provider, health care facility, or hospital, or agent, trustee, or assignee thereof, may maintain any action at law against an insured to collect sums in excess of the amount owed by the insured as a copayment, coinsurance, or deductible for similar services provided by a participating provider under the insured's policy of accident and health or sickness insurance."
SECTION 3. Chapter 431, Hawaii Revised Statutes, is amended by adding a new section to article 14G to be appropriately designated and to read as follows:
"§431:14G-
Out-of-network or
nonparticipating provider reimbursement; rate calculation. (a)
Notwithstanding section 431:10A-A or any contract to the contrary, a managed
care plan shall reimburse a nonparticipating provider the greater of:
(1) The usual and
customary rate for similar services provided by a participating provider under
the insured's managed care plan; or
(2)
per cent of the amount medicare reimburses on a fee-for-service basis for the same
or similar services in the general geographic region in which the services were
rendered.
(b) Nothing in this section shall be construed to
require a managed care plan to cover services not required by law or by the
terms and conditions of the managed care plan.
(c) For purposes of this section "usual and customary rate" shall mean the managed care plan's average contracted rate."
SECTION 4. Chapter 432, Hawaii Revised Statutes, is amended by adding three new sections to article 1 to be appropriately designated and to read as follows:
"§432:1-A Balance billing; hold harmless; emergency services; mandatory mediation. (a) Every contract between a mutual benefit society and a participating provider of health care services shall be in writing and shall set forth that in the event the mutual benefit society fails to pay for health care services as set forth in the contract, the subscriber or member shall not be liable to the provider for any sums owed by the mutual benefit society.
(b) If a contract with a participating provider
has not been reduced to writing as required by subsection (a), or if a contract
fails to contain the required prohibition, the participating provider shall not
collect or attempt to collect from the subscriber or member sums owed by the mutual
benefit society. No participating
provider, or agent, trustee, or assignee thereof, may maintain any action at
law against a subscriber or member to:
(1) Collect sums owed
by the mutual benefit society; or
(2) Collect sums in
excess of the amount owed by the subscriber or member as a copayment,
coinsurance, or deductible under the subscriber's or member's plan contract.
(c) When a subscriber or member receives
emergency services from a provider who is not a participating provider in the
provider network of the subscriber or member, the subscriber or member shall not
incur greater out-of-pocket costs for emergency services than the subscriber or
member would have incurred with a participating provider of health care services. No nonparticipating provider, or agent,
trustee, or assignee thereof, may maintain any action at law against a
subscriber or member to collect sums in excess of the amount owed by the
subscriber or member as a copayment, coinsurance, or deductible under the subscriber's
or member's plan contract.
(d) When a subscriber or member receives emergency
services from a provider who is not a participating provider in the provider network
of the subscriber or member, the mutual benefit society shall use data from a transparent,
third-party database upon which to calculate out-of-network reimbursements for emergency
services.
(e) Any dispute between a mutual benefit society and
provider that arises pursuant to this section shall be submitted to mandatory mediation
to be overseen by the insurance division.
(f)
For purposes of this section:
"Emergency condition"
means a medical or behavioral condition that manifests itself by acute symptoms
of sufficient severity, including severe pain, such that a prudent layperson,
possessing an average knowledge of medicine and health, could reasonably expect
the absence of immediate medical attention to result in:
(1) Placing the
health of the person afflicted with the condition in serious jeopardy;
(2) Serious impairment
to the person's bodily functions;
(3) Serious
dysfunction of any bodily organ or part of the person; or
(4) Serious
disfigurement of the person.
"Emergency services"
means, with respect to an emergency condition:
(1) A medical
screening examination as required under section 1867 of the Social Security
Act, title 42 United States Code section 1395dd; and
(2) Any further
medical examination and treatment, as required under section 1867 of the Social
Security Act, title 42 United States Code section 1395dd, to stabilize the
patient.
§432:1-B Balance billing; hold harmless;
non-emergency services. No
nonparticipating health care provider, health care facility, or hospital, or
agent, trustee, or assignee thereof, may maintain any action at law against a
subscriber or member to collect sums in excess of the amount owed by the
subscriber or member as a copayment, coinsurance, or deductible for similar
services provided by a participating provider under the subscriber's or member's
plan contract.
§432:1-C Out-of-network
or nonparticipating provider reimbursement; rate calculation. (a)
Notwithstanding section 432:1-A, and absent any contract to the
contrary, a mutual benefit society shall reimburse a nonparticipating provider
the greater of:
(1) The usual and
customary rate for similar services provided by a participating provider under
the subscriber's or member's plan contract; or
(2)
per cent of the amount medicare reimburses on a fee-for-service basis for the
same or similar services in the general geographic region in which the services
were rendered.
(b) Nothing in this section shall be construed to
require a mutual benefit society to cover services not required by law or by
the terms and conditions of the plan contract.
(c) For purposes of this section "usual and customary rate" shall mean the mutual benefit society's average contracted rate."
SECTION 5. Chapter 432D, Hawaii Revised Statutes, is amended by adding three new sections to be appropriately designated and to read as follows:
"§432D-A Balance billing; hold harmless; emergency
services; mandatory mediation. (a) Every contract between a health maintenance
organization and a participating provider of health care services shall be in
writing and shall set forth that in the event the health maintenance organization
fails to pay for health care services as set forth in the contract, the
subscriber or enrollee shall not be liable to the provider for any sums owed by
the carrier or health maintenance organization.
(b) If a contract with a participating provider has
not been reduced to writing as required by subsection (a), or if a contract
fails to contain the required prohibition, the participating provider shall not
collect or attempt to collect from the subscriber or enrollee sums owed by the
health maintenance organization. No
participating provider, or agent, trustee, or assignee thereof, may maintain
any action at law against a subscriber or enrollee to:
(1) Collect sums
owed by the health maintenance organization; or
(2) Collect sums in
excess of the amount owed by the subscriber or enrollee as a copayment, coinsurance,
or deductible under the subscriber's or enrollee's policy, contract, plan, or
agreement.
(c) When a subscriber or enrollee receives
emergency services from a provider who is not a participating provider in the
provider network of the subscriber or enrollee, the subscriber or enrollee
shall not incur greater out-of-pocket costs for emergency services than the subscriber
or enrollee would have incurred with a participating provider of health care
services. No nonparticipating provider,
or agent, trustee, or assignee thereof, may maintain any action at law against
a subscriber or enrollee to collect sums in excess of the amount owed by the
subscriber or enrollee as a copayment, coinsurance, or deductible under the
subscriber's or enrollee's policy, contract, plan, or agreement.
(d) When a subscriber or enrollee receives emergency
services from a provider who is not a participating provider in the provider network
of the subscriber or enrollee, the health maintenance organization shall use data
from a transparent, third-party database upon which to calculate out-of-network
reimbursements for emergency services.
(e) Any dispute between a health maintenance organization
and provider that arises pursuant to this section shall be submitted to mandatory
mediation to be overseen by the insurance division.
(f)
For purposes of this section:
"Emergency condition"
means a medical or behavioral condition that manifests itself by acute symptoms
of sufficient severity, including severe pain, such that a prudent layperson,
possessing an average knowledge of medicine and health, could reasonably expect
the absence of immediate medical attention to result in:
(1) Placing the
health of the person afflicted with the condition in serious jeopardy;
(2) Serious
impairment to the person's bodily functions;
(3) Serious
dysfunction of any bodily organ or part of the person; or
(4) Serious
disfigurement of the person.
"Emergency services"
means, with respect to an emergency condition:
(1) A medical
screening examination as required under section 1867 of the Social Security
Act, title 42 United States Code section 1395dd; and
(2) Any further
medical examination and treatment, as required under section 1867 of the Social
Security Act, title 42 United States Code section 1395dd, to stabilize the
patient.
§432D-B Balance billing; hold harmless; non-emergency
services. No nonparticipating
health care provider, health care facility, or hospital, or agent, trustee, or
assignee thereof, may maintain any action at law against a subscriber or enrollee
to collect sums in excess of the amount owed by the subscriber or enrollee as a
copayment, coinsurance, or deductible for similar services provided by a
participating provider under the subscriber's or enrollee's policy, contract,
plan, or agreement.
§432D-C Out-of-network
or nonparticipating provider reimbursement; rate calculation. (a)
Notwithstanding section 432D-A or any contract to the contrary, a health
maintenance organization shall reimburse a nonparticipating provider the
greater of:
(1) The usual and
customary rate for similar services provided by a participating provider under
the subscriber's or enrollee's policy, contract, plan, or agreement; or
(2)
per cent of the amount medicare reimburses on a fee-for-service basis for the
same or similar services in the general geographic region in which the services
were rendered.
(b) Nothing in this section shall be construed to
require a health maintenance organization to cover services not required by law
or by the terms and conditions of the policy, contract, plan, or agreement.
(c) For purposes of this section "usual and customary rate" shall mean the carrier or health maintenance organization's average contracted rate."
SECTION 6. Section 431:10-109, Hawaii Revised Statutes, is amended to read as follows:
"[[]§431:10-109[]] Disclosure
of [health care coverage and benefits.]
information. (a) In order to ensure that all individuals
understand their health care options and are able to make informed decisions,
all insurers shall provide current and prospective insureds with written
disclosure of [coverages and benefits, including information on coverage
principles and any exclusions or restrictions on coverage.] the
following information:
(1) Coverages and benefits,
including information on coverage principles and any exclusions or restrictions
on coverage;
(2) With regard to
out-of-network coverage:
(A) For
non-emergency services, the amount that the insurer will reimburse under the rate
calculation for out-of-network health care specified in section 431:14G‑ ;
and
(B) Examples
of anticipated out-of-pocket costs for frequently billed out-of-network health
care services; and
(3) Information in
writing and through an internet website that reasonably permits an insured or
prospective insured to estimate the anticipated out-of-pocket cost for out-of-network
health care services in a geographical area based upon the difference between
what the insurer will reimburse for out-of-network health care services and the
rate calculation specified in section 431:14G‑ for
out-of-network health care services.
(b) The information provided shall be current,
understandable, and available prior to the issuance of a policy, and upon
request after the policy has been issued[.]; provided that nothing in
this section shall prevent an insurer from changing or updating the materials
that are made available to insureds.
(c) For purposes of this section:
"Emergency condition"
means a medical or behavioral condition that manifests itself by acute symptoms
of sufficient severity, including severe pain, such that a prudent layperson,
possessing an average knowledge of medicine and health, could reasonably expect
the absence of immediate medical attention to result in:
(1) Placing the
health of the person afflicted with the condition in serious jeopardy;
(2) Serious
impairment to the person's bodily functions;
(3) Serious
dysfunction of any bodily organ or part of such person; or
(4) Serious
disfigurement of the person.
"Emergency services"
means, with respect to an emergency condition:
(1) A medical screening
examination as required under section 1867 of the Social Security Act, title 42
United States Code section 1395dd; and
(2) Any further
medical examination and treatment, as required under section 1867 of the Social
Security Act, title 42 United States Code section 1395dd, to stabilize the
patient."
SECTION 7. In codifying the new sections added by sections 2, 4, and 5 of this Act, the revisor of statutes shall substitute appropriate section numbers for the letters used in designating the new sections in this Act.
SECTION 8. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 9. This Act shall take effect on January 2, 2050, and shall be repealed on January 2, 2025; provided that section 431:10-109 shall be reenacted in the form in which it read on the day before this effective date of this Act.
Report Title:
Balance Billing; Surprise Billing; Prohibitions; Health Insurance; Nonparticipating Providers
Description:
Prohibits nonparticipating health care providers from balance billing patients in specific circumstances. Establishes rate calculation requirements for reimbursement of nonparticipating providers. Repeals January 2, 2025. Effective 1/2/2050. (SD1)
The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.