On June 1, 2018, New Jersey Governor Phil Murphy signed into law the Out-of-Network Consumer Protection, Transparency, Cost Containment and Accountability Act (the “Act”), available at: http://www.njleg.state.nj.us/bills/BillView.asp?BillNumber=A2039, which becomes effective on the 90th day after enactment.
The Act enhances consumer protections related to surprise out-of-network healthcare charges, and affects health care facilities, health care professionals, and health insurance carriers. Requirements under the Act specific to facilities, professionals, and carriers are summarized below.
Health care facilities or carriers that violate any provision of the Act will be liable for not more than $1,000 for each violation, where each day on which a violation occurs is considered a separate violation, up to $25,000 per occurrence. Health care professionals who violate the Act will be liable for up to $100 per violation, where each day on which a violation occurs is considered a separate violation, up to $2,500 per occurrence. Other penalties may be initiated by the Commissioner of Banking and Insurance, the Commissioner of Health, or the relevant professional or licensing board, as appropriate, pursuant to rules that may be adopted under the Act.
The Act also creates an arbitration process to resolve out-of-network billing disputes, so healthcare providers should be prepared for the new, multi-step arbitration process that will be utilized in New Jersey.
FACILITIES
Under the Act, health care facilities must make available to the public a list of the facility’s standard charges for items and services provided, and must, prior to scheduling an appoint for non-emergency or elective procedures:
- disclose to patients whether the facility is in-network or out-of-network in respect to the patient’s health benefits plan;
- advise patients that, if the facility is in-network, the patient will not incur any out-of-pocket costs outside of those typically applicable to an in-network procedure, unless the patient knowingly, voluntarily, and specifically selects an out-of-network provider to provide services;
- inform patients that, if the facility is out-of-network, the patient will have a financial responsibility applicable to health care services provided at an out-of-network facility.
Facilities must also post on their website the health benefits plans in which the facility participates, a statement that physician services are not included in the facility’s charges, and the contact information of the hospital-based physician groups contracted with the facility or employed by the facility.
For out-of-network emergency services, facilities may not bill patients more than the in-network deductible, copayment, or coinsurance amount.
PROFESSIONALS
Under the Act, health care professionals must disclose the health benefits plans in which the professionals participate, as well as the facilities with which they are affiliated, prior to performing any non-emergency services. Out-of-network health care professionals must:
- prior to scheduling any non-emergency procedure, inform patients that they are out-of-network and that the estimated amount to be billed for services is available upon request;
- disclose to patients the amount the health care professional will bill absent unforeseen medical circumstances that may arise when the medical service is provided; and
- advise patients that they will have financial responsibility for health care services provided by an out-of-network professional in excess of their copayment, deductible, or coinsurance, and that they may be responsible for any costs in excess of those allowed by their health benefits plan.
Health care professionals must also provide the contact information of any health care providers scheduled to perform anesthesiology, lab, pathology, radiology or assistant surgeon services in connection with the care to be provided, and to recommend that the patient contact their carrier to learn more about any costs associated with these services.
For out-of-network emergency services, or inadvertent out-of-network services (for example, where laboratory testing ordered by an in-network facility is performed by an out-of-network laboratory), professionals may not bill patients more than the in-network deductible, copayment, or coinsurance amount.
CARRIERS
The Act requires that health care carriers must provide to covered patients:
- a clear and understandable description of the plan’s out-of-network health care benefits, including the methodology used by the entity to determine the allowed amount for out-of-network services;
- the allowed amount the plan will reimburse under that methodology;
- examples of anticipated out-of-pocket costs for frequently billed out-of-network services;
- information that reasonably permits a covered person or prospective covered person to calculate the anticipated out-of-pocket cost for out-of-network services; and
- information in response to a covered person’s request, concerning whether a health care provider is an in-network provider.
Where patients receive emergency services at an out-of-network health care facility, or inadvertently receive covered services from an out-of-network professional at a health care facility (for example, where laboratory testing ordered by an in-network facility is performed by an out-of-network laboratory), the carrier must ensure that the patient incurs no greater out-of-pocket costs than he or she would have incurred with an in-network provider for covered services.