Healthcare Association of New York State www.hanys.org

Out-of-Network Update

Cara HenleyDirector, Insurance & Managed Care

•March 12, 2015

Healthcare Association of New York State www.hanys.org

Out-of-Network Law

• Law is the result of negotiations between Department of Financial Services, Department of Health, Legislature, Hospitals, Physicians, and Health Plans.

• Follows years of debate over the adequacy of out-of-network reimbursement and balance bills sent to consumers.

• Effective for dates of service on or after March 31, 2015

OON Guide Available on the HANYS’ Web Site

Healthcare Association of New York State www.hanys.org

Major Provisions• Holds patients harmless for emergency services and surprise

bills

• Creates new disclosure requirements for hospitals, physicians, and health plans (and other providers)

• Creates Independent Dispute Resolution (IDR) process for patients, plans, and physicians who disagree about out-of-network reimbursement for emergency and surprise bills

• Bolsters Network Adequacy requirements and the State’s authority to enforce adequacy standards

Healthcare Association of New York State www.hanys.org

Definition of Emergency Bill• A bill for services rendered pursuant to EMTALA to treat 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:

– placing the health of the person afflicted with such condition in serious jeopardy, or in the case of a behavioral condition placing the health of such person or others in serious jeopardy;

– serious impairment to such person's bodily functions;

– serious dysfunction of any bodily organ or part of such person; or

– serious disfigurement of such person.

Healthcare Association of New York State www.hanys.org

Types of Surprise Bill

Services are rendered by a non-par physician at a par hospital (or ambulatory surgical center), without the insured’s knowledge or unforeseen medical services arise.

A patient has not timely received all disclosures required under the new law.

Services were referred by a par physician to a non-par provider without explicit written consent of the insured acknowledging that the referral may result in costs not covered by their plan.

A non-par referral occurs when:

• A service is performed by a non-par provider in the par physician’s office or practice during the same visit.

• The par physician sends a specimen taken in the par physician’s office to a non-par lab or pathologist

• Any other service performed by a non-par provider, when referrals are required by the health plan.

Healthcare Association of New York State www.hanys.org

More than Two Types of Bills

Surprise Bills Resulting from Scheduled Service

Bills for Emergency Services

Bills Resulting from Post-Stabilization Services

• May not be a surprise or emergency bill.

• “A patient in a hospital setting has no reasonable ability to inquire, understand, or reject necessary medical services.”

• Surprise bills and emergency services are addressed by the law.

Healthcare Association of New York State www.hanys.org

Hospital Disclosure Requirement• HANYS has shared with members a

disclosure template that has been reviewed and approved by DOH and DFS.

• DOH is sending a “Dear CEO” to hospitals notifying them of their disclosure responsibilities effective March 31, 2015.

• “Given the CMS final rule, State law only requires posting standard charges on the hospital’s website if the hospital does not make the list of charges publicly available in some other way.”

Healthcare Association of New York State www.hanys.org

Hospital Disclosure Requirement

Posted to Your Web Site

List of the hospital’s standard charges for items and services it provides, including DRGs to the extent required by ACAList of participating health plans

A statement that includes the following information:• physician services provided in the hospital are not included in the hospital charges• physicians who provide services in the hospital may or may not participate with the

same health plans as the hospital• patients should check with the physician arranging for the hospital services to

determine the plans with which the physician participates; • the name, address, and phone number of physician groups the hospital contracts with

to provide services along with instructions on how to contact those groups to determine the health plans in which the physicians participate.

In Registration or Admission Materials Provided to Patients for Non-Emergency

Services

Advise patient to check with the physician arranging the hospital services to determine the name, practice name, address, and phone number of any other physician whose services will be arranged by the physician

Advise patient whether the services of physicians who are employed or contracted by the hospital to provide services, are reasonably anticipated to be provided to the patient

Information about how to determine in a timely manner the health plans in which the physician’s participate.

Healthcare Association of New York State www.hanys.org

Other Disclosure Requirements

Physicians

Must provide to patient the contact information for any provider scheduled to perform anesthesiology, laboratory, pathology, radiology, or assistant surgeon services in connection with care provided in the physician’s office or referred or coordinated by the physician.

For scheduled admissions or outpatient services, provide the patient and the hospital with contact information of any physician whose services will be arranged by the physician prior to the provision of services.

Plan participation and hospital affiliation.

For out-of-network services, must inform patients that fees are available upon request.

Health Plans

On Web Site: When Service is Scheduled:

A list of physician affiliations with participating hospitals

Whether the scheduled provider is in-network

The method an enrollee can use to submit a claim directly

The approximate dollar amount the insurer will pay for the OON service

The methodology used to determine reimbursement for OON services

The amount the plan will reimbursement for OON services (as a percentage of UCR)

Examples of anticipated out-of-pocket costs for frequently billed OON services

Out-of-pocket cost estimator for OON services

Healthcare Association of New York State www.hanys.org

Independent Dispute Resolution (IDR)

• The law establishes a dispute resolution mechanism for patients, plans, and physicians who disagree about out-of-network reimbursement for “surprise” bills and emergency services.

• IDR would resemble baseball-style arbitration

• Timeframe for IDR would run concurrent to the prompt pay clock (45 days for paper claims; 30 days for electronic claims).

Healthcare Association of New York State www.hanys.org

Dispute Resolution for Surprise Bills

Patient Has Not Assigned Benefits/Uninsured/Self-Insured:

Patient Submits Dispute

Plan pays non par bill or negotiates payment

If negotiation fails, plan pays reasonable amount to provider.

The plan or physician can submit to IDR if there is a dispute over payment.

IDR makes a determination within 30 days or directs the parties to negotiate for up to

10 days.

If negotiation fails or IDR makes a determination, it will select either the

plan’s payment or physician fee.

Patient is not required to pay the physician’s fee to submit claim to IDR.

Patient Has Assigned Benefits:Plan or Physician Submit Dispute

IDR makes a determination within 30 days.

IDR determines a reasonable fee for services. Physician is barred from balance

billing.

Payment for Dispute Resolution

Loser pays dispute resolution fee; payment is split if dispute ends by

negotiation; patients held harmless if fee poses a hardship.

Healthcare Association of New York State www.hanys.org

Dispute Resolution for Emergency Bills

For Uninsured or Self-Insured PatientsPatient Submits Dispute

The plan must pay the non-participating physician an amount it determines reasonable

The plan hold patient harmless from any out-of-pocket cost other than what s/he would owe if

the physician was in-network.

Either the plan or physician can submit the dispute for review to the IDR.

IDR makes a determination within 30 days or directs the parties to negotiate for up to 10

days.

If negotiation fails or IDR makes a determination, it will select either the plan’s

payment or physician fee.

Patient is not required to pay the physician’s fee to submit claim to IDR.

For Insured PatientsPlan or Physician Submit Dispute

IDR makes a determination within 30 days.

IDR determines a reasonable fee for services. Physician is barred from balance billing.

Certain Emergency-Related CPT codes exempt from dispute resolution if the amount

billed is <120% of UCR.

Reimbursement subject to fee schedules also exempt from dispute resolution.

Healthcare Association of New York State www.hanys.org

Make Available Out-of-Network Benefit

• Health plans that issue a comprehensive group policy that covers out-of-network (OON) services must make available at least one alternative option for out-of-network coverage using UCR after imposition of 20% coinsurance.

• The OON make available benefit does not require health plans to offer OON benefits in a market in which they do not currently offer any coverage, or in which they do not offer out-of-network coverage.

• If there is no OON coverage available in a rating region, a health plan that issues a comprehensive group policy in the rating region may be required to make available at least one option for OON coverage using UCR after imposition of 20% coinsurance.

Usual and Customary RateDefined as the 80th percentile of all charges for a particular specialty provided

in the same geographic area, according to FAIR Health.

Healthcare Association of New York State www.hanys.org

Network Adequacy and Other Consumer Protections

• DFS has authority to review EPO and PPO networks for adequacy; DOH has existing authority to review HMO and QHP networks– Will use existing standard (At least one hospital in each county; however,

for Erie, Monroe, Nassau, Suffolk, Westchester, Bronx, Kings, New York and Queens the network will need to include at least 3 hospitals)

• Enrollees can request a referral to go out-of-network if the plan does not have a geographically accessible or appropriately qualified provider in-network

• Enrollees can externally appeal if an out-of-network referral is denied

Healthcare Association of New York State www.hanys.org

Questions?

Cara HenleyDirector, Insurance & Managed Care

(518) 431-7827chenley@hanys.org