Earlier today the California Senate voted 25-10, on a bipartisan basis, to pass legislation to prevent patients from facing surprise out-of-network medical bills after they receive care in in-network hospitals or other facilities. Sponsored by Health Access California, AB533 (Bonta) would protect patients from “surprise” bills from out-of-network doctors when they did the right thing by going to an in-network hospital or imaging center or other facility. Under AB 533, patients would only have to pay in-network cost sharing. This bill joins two other patient protection bills, passed earlier in the day, designed to prevent unfair out-of-pocket costs: SB 137 (Hernandez) an AB 339 (Gordon).
AB 533 On Surprise Bills
A recent survey by Consumers Union found 1 in 4 Californians received a surprise medical bill. Even the most careful consumers can end up being treated unwittingly by an out-of-network provider at in-network facility, only to receive a surprise bill for the difference between the provider’s charge and what the health plan pays. That difference can run into hundreds, thousands, or even tens of thousands of dollars–an amount that can be destabilizing for family finances. Examples include:
- A consumer who goes to an in-network imaging center, only to find that a non-contracting radiologist the consumer never met was responsible for reviewing the consumer’s imaging.
- A consumer who selects an in-network surgeon for an operation at an in-network hospital or surgery center but finds that the anesthesiologist is a non-contracting provider when billed.
- A consumer goes to an in-network hospital but the slide or sample is sent off to an out-of-network pathologist the consumer never met or agreed to receive care from.
Specifically, the bill:
- Requires health plans to let consumers 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.
- Counts such co-pays toward the annual out of pocket limit of $6,600 per patient.
- Allows an enrollee to voluntarily consent to the use of an out-of-network provider if the consumer voluntarily consents in advance.
- Creates a mandatory and binding Independent Dispute Resolution process to resolve payment disputes between non-contracting providers and plans.
- Requires plans to pay non-contracting providers for services provided at an in-network facility a rate based on the criteria specified in the bill.
- Applies only to non-emergency medical services.
Despite some opposition from some doctors’ groups, the Health Access-sponsored bill now faces a final Assembly concurrence vote, with broad support from the California Labor Federation to the Chamber of Commerce, and including leading consumer and patient groups. (See separate AB533 fact sheet).
Other Patient Protection Bills Passed by Second Chamber Earlier Today
- SB137(Hernandez): would require accurate, standardized, and updated provider directories by health plans. Recent surveys by the Department of Managed Health Care found that 25% of the directories of two major health plans were found to be inaccurate or out-of-date (See separate SB137 fact sheet).
- AB339(Gordon) would require insurers to cover medically necessary prescription drugs and limit cost-sharing on specialty drugs and other needed medications. Now awaiting a concurrence vote in the Assembly, AB 339 would ensure coverage for drugs for which there is no therapeutic equivalent; prohibits placing most or all of the drugs to treat a condition on the highest cost tiers of a formulary; requires formularies to be based on clinical guidelines and peer-reviewed scientific evidence; places monthly cap on specialty drug cost sharing of $250 per month per prescription for most health plans; and more. (See separate AB339 fact sheet.)
Both bills also face concurrence votes Friday, the last day of 2015’s legislative session.
Patient Protection Bills Already Sitting on the Governor’s Desk
- AB1305 (Bonta) would ensure an individual patient does not face higher out-of-pocket costs just because they are in family plans, closing a potential loophole in the out-of-pocket maximum protections in the Affordable Care Act. (See separate AB1305 fact sheet.)
- Also on the Governor’s desk is AB 248 (R. Hernández) Minimum Value Guarantee for Large Employer Coverage, to prohibit the sale of subminimum coverage, defined as coverage with less than 60% actuarial value, by insurers to large employers. Such plans put workers in a double bind: with unmanageable costs for uncovered care; but because they took up that coverage, often unwittingly, they are automatically ineligible for premium subsidies through Covered California. See our fact sheet.
Special Session Legislation on Medi-Cal Financing & Public Health: Tobacco Tax Bills
The clock is ticking on many different bills to help reduce smoking and save lives, including proposals that would increase the tobacco tax by $2.
One Senate bill, SB x2 14, authored by Senator Ed Hernandez, would combine the tobacco tax with a revamped tax on managed-care organizations (MCOs). The bill, which passed both Public Health and Finance Committees yesterday, replaced the existing MCO tax with a new health plan tax that would generate $1.1 billion to stabilize Medi-Cal financing and inject $231 million into historically under-funded programs serving Californians with developmental disabilities.
Any tax (on MCOs, tobacco, or something else) requires a 2/3 and therefore bipartisan vote. If a bipartisan consensus does not come together by the end of the 2015 legislation session at midnight, many organizations including Health Access California are planning to move forward with a tobacco tax ballot measure for November 2016. Recent polling shows overwhelming support for a $2 per pack increase. Watch this blog, our Twitter feed, and your email inbox for updates as the final day of the session unfolds.