California Enacts Strongest in Nation Protections Against Surprise Out-of-Network Medical Bills

Most patients know they have to go to their designated in-network physician(s) in order to prevent out-of-network costs. Yet even when patients follow the rules and went to an in-network hospital or other facility, many have been subjected to a surprise medical bill because they were unknowingly seen by an out-of-network physician. For example, if Susan goes to an in-network hospital for lab work, but an out-of-network pathologist analyzes her results, the patient would then be billed for the pathologist’s charges at out-of-network levels. A 2015 Consumers Union survey reported that 1 in 4 Californians who visited a hospital or had surgery within the last two years were charged out-of-network costs when they believed that they were receiving care from in-network physicians.

Thankfully, starting this July 1st, these surprise bills, sometimes totaling in the thousands of dollars, which wreaked financial havoc on many California families, may become a thing of the past. Last year, the California State Legislature passed, and the Governor signed into law, Assembly Bill 72, which was co-sponsored by Health Access California and the California Labor Federation. The new protection ensures that if patients go to an in-network facility, they are only responsible for in-network cost sharing (co-pays, deductibles, coinsurance), even if they are treated by an out-of-network doctor they did not consent to. No patient, trying to do the right thing by visiting an in-network facility, should be hit with one of these out-of-network bills. This is particularly important for low-income families where an unexpected medical bill of hundreds or thousands of dollars can mean economic catastrophe.

Key provisions of the new law include:

  • Requires health plans to ensure consumers to pay the same co-pays and other cost sharing that they would pay for in-network care when they end up being treated by an out-of-network provider at an in-network facility for non-emergency services.
  • Protects consumers from having their credit affected by potential leans or debt.
  • Allows patients to receive care from an out-of-network physician if they chose, but they must sign a consent form 24 hours before receiving care. The out-of-network provider must provide a written estimate of the patient’s total out-of-pocket costs.

AB 72, which had bipartisan support, applies to all services received on or after July 1st, 2017. California consumers now enjoy the nation’s strongest protections from surprise medical bills.

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