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Out of Network Regulations Effective March 31

New regulations will go into effect on March 31, 2015 to regulate out-of-network (OON) health care services, including billing, reimbursement and consumer disclosure for services provided to patients by health care providers who do not participate in a patient's health insurance plan.

The regulations are the result of the passage of a law that was enacted last year (Chapter 60 of the Laws of 2014) to provide transparency to consumers and protect patients from excessively expensive bills for emergency care and "surprise" bills for non-emergency care. New York ACEP was very involved in the 2014 negotiations of the law and the development of State regulations and guidance documents over the past year.

New York ACEP was successful in getting an exemption from the Independent Dispute Resolution (IDR) process for certain high volume emergency medicine CPT codes that are under $600, adjusted annually for inflation. The new law does not prohibit balancing billing for out-of-network emergency services.

Provided below is a summary of major provisions of the law. For more detailed information please go to the following documents on the New York State Department of Financial Services' (DFS) website:

OON Law Guidance
Summary of Process

Emergency Services
When a health plan receives a bill for emergency services from a non-participating provider, the plan is required to pay the physician an amount that it determines reasonable, less applicable patient cost sharing. The law places the responsibility on the health plan to ensure that the patient receives no greater out-of-pocket costs than they would have incurred with a participating health care provider. Either the health plan or the physician may file a payment dispute with an Independent Dispute Resolution entity certified by DFS.

Surprise Bills for Non-Emergency Services
A surprise bill is defined as a bill for non-emergency services received by:

1) an insured patient from a non-participating physician at a participating hospital or ambulatory surgical center where a participating physician is unavailable, a non-participating doctor provided the services without the patient's knowledge, or unforeseen medical circumstances arose at the time of service;

2) an insured patient for services rendered by a non-participating provider, where the services were referred by a participating physician to a non-participating provider without the explicit consent of the insured; or

3) a patient who is not insured for services rendered by a physician at a hospital or ambulatory surgical center where the patient did not receive timely notice of required disclosures.

When a non-participating physician submits a claim for a surprise bill with an assignment of benefits form the non-participating physician may not bill the patient except for any applicable cost sharing. This requirement does not apply to emergency services.

The non-participating physician may bill the health plan and the health plan must pay the physician the billed amount or attempt to negotiate. If the negotiation does not result in resolution of the dispute, the health plan must pay the non-participating an amount it deems reasonable, less applicable patient cost sharing. Either party may file a dispute with the IDR entity.

The assignment of benefits form is available at: http://dfs.ny.gov/insurance/health/OON_assignment_benefits_form.pdf

Independent Dispute Resolution Process
New York ACEP was successful in getting an exemption from the IDR process for particular CPT codes that are less than $600 (annually adjusted for inflation) and do not exceed 120% of Usual and Customary Cost (UCR). UCR is defined as the 80th percentile of all charges for a health service rendered by a provider in the same or similar specialty and provided in the same geographic region as reported by a benchmarking database maintained by a nonprofit organization. FAIR Health is currently the only entity recognized to calculate UCR.

The current threshold for 2015, adjusted for inflation, is $613.50. The following CPT codes that meet the criteria are exempt: 99281-99285, 99288, 99291, 99292, 99217-99220, 99224-99226, and 99234- 99236.

According to DFS, the cost of the IDR process will range from $225 to $325 per appeal.

Provided below is brief description of the IDR process. For more information go to: http://dfs.ny.gov/legal/regulations/emergency/np400t.pdf

The IDR application is available at: http://dfs.ny.gov/consumer/health/IDR_Provider_Application.pdf

  • Either a non-participating physician or health care plan may submit a dispute regarding a fee to an IDR entity for emergency services and for "surprise bills" for non-emergency services      provided in a hospital or ambulatory surgery center or through referral by a participating provider.
  • An uninsured patient may submit a dispute if they have not timely received all of the required disclosures under the law.
  • The IDR entity must select either the physician's charges or the insurer's payment based on the criteria set forth in the law.
  • In instances where the IDR entity disagrees with both the physician's fee and the insurer's payment, the reviewer would be permitted to ask the parties to negotiate a fee.
  • All decisions by the IDR entity are required within 30 days.
  • The IDR entity is required to use licensed physicians in active practice in the same or similar specialty as the physician subject to review. To the extent practicable, the physician must be licensed in this State.
  • The losing party pays for the dispute resolution process, except in the case where a health care plan and a physician reach a settlement after being directed to negotiate by the IDR entity in which case responsibility for payment is evenly divided between the health care plan and the physician.
  • When the IDR entity rules in favor of a physician for a dispute brought by an uninsured patient, payment shall be the responsibility of the patient unless the Superintendent of DFS determines that this would pose a hardship to the patient.

Disclosures by Health Care Professionals, Group Practices, Diagnostic & Treatment Centers (D&TC) and Health Centers to Patients

  • Doctors and other licensed health care professionals, group practices, D&TCs and health centers are required to disclose to patients or prospective patients in writing or via a website the health care plans in which the health care professional, group practice, or diagnostic and treatment center or health center is a participating provider and the hospitals with which a health care professional is affiliated prior to the provision of non-emergency services and verbally at the time an appointment is scheduled.
  • If a health care professional, group practice, D&TC, or health center does not participate in the network of a patient or prospective patient's plan, they must, prior to the provision of non-emergency care, inform the patient or prospective patient that the amount or estimated amount to be billed is available upon request. If the patient or prospective patient makes a request, the health care practitioner, group or facility must provide this information in writing.
  • Physicians are required to provide the name, practice name, address and phone number of any health care provider scheduled to perform anesthesiology, laboratory, pathology, radiology or assistant surgeon services in connection with care to be provided in the physician's office for the patient or coordinated or referred by the physician for the patient at the time of referral to or coordination of such services with such provider.
  • Physicians are required, for a patient's scheduled hospital admission or scheduled outpatient hospital services, to provide a patient and the hospital with the name, practice name, address and phone number of any other physician whose services will be arranged by the physician and are scheduled at the time of the pre-admission testing, registration or admission at the time non-emergency services are scheduled; and information as to how to determine the health care plans in which that physician participates.     

Disclosures by Hospitals to Patients
Hospitals are required to:

  • Establish, update and make public on their website, to the extent required by federal guidelines, a list of the hospital's standard charges.
  • Post on their website, the health plans with which the hospital participates.
  • Post a statement on their website that: physician services provided in the hospital are not included in the hospitals charges; physicians who provide services in the hospital may or may not participate with the same health care plans as the hospital; the prospective patient should check with the physician arranging for the hospital services to determine the health care plans in which the physician participates.
  • Provide, as applicable, on their website the name, mailing address and telephone number of the physician groups that the hospital has contracted with to provide services including anesthesiology, pathology or radiology, and instructions on how patients can contact these groups to determine the health care plans in which they participate.
  • Provide, as applicable, on their website, the name, mailing address, and telephone number of physicians employed by the hospital and whose services may be provided at the hospital, and the health care plans in which they participate.

Disclosures by Health Plans to Patients
Insurers are required to:

  • Provide a listing of languages spoken and affiliation with participating hospitals on the health plan's website.     
  • When a policy offers out-of-network coverage, health plans must provide patients with a description of the methodology used to determine reimbursement for out-of-network health care services, a description of the amount that the insurer will reimburse under the methodology set forth as a percentage of UCR, examples of anticipated out of-pocket costs for frequently billed services, and information to facilitate calculation of out of-pocket costs.

Expanded Access to Out-of-Network Care

  • Patients enrolled in all New York regulated health insurance products will be given the right to access out-of-network health care providers at no additional cost to the patient if the insurer does not have an in-network provider with the appropriate training and experience to meet the health care needs of the patient.
  • Patients can file an appeal through the Independent External Appeals process at DFS when an insurance company denies a patient request to receive services from an out-of-network provider. Information on the External Appeals process is available at: http://www.dfs.ny.gov/insurance/extapp/extappqa.htm

Out-of-Network Rates/Adequacy

  • Insurers that issue a comprehensive group or group remittance policy for out-of-network coverage must "make available" at least one policy that provides coverage of at least 80% of the UCR. The Superintendent of DFS is authorized to require the offering of such a policy to a group market in a region where no coverage is available.     
  • All insurance products, not just HMOs, are required to have adequate networks.

Out-of-Network Workgroup
A nine member Workgroup is established and appointed by the Governor with recommendations from the Legislature. The Superintendent of DFS and the Commissioner of the Department of Health will serve as Co-Chairpersons. The Workgroup is charged with reviewing current out-of network rates and coverage and making recommendations to the Governor and the Legislature no later than January 1, 2016.