Los Angeles resident Betty Chow had a cervical disc replaced in August 2020 at a surgery center that was part of her Anthem Blue Cross PPO network.
Thirteen months later, she was blindsided by a nearly $2,000 bill from the anesthesiologist who was part of her surgical team but not under contract with her PPO, or preferred provider organization.
Chow, a 35-year-old veterinarian, says she discussed the bill with her boyfriend, a registered nurse. He told her about a California law that went into effect in 2017 that banned such “surprise bills” from out-of-network medical providers who work at in-network facilities.
Unfortunately, this law does not protect Chow or the nearly 6 million other Californians who receive health coverage through employers who pay employees’ medical bills out of their own cash. These “self-funded” plans are regulated by the US Department of Labor – and are therefore beyond the reach of state law.
But a federal law that took effect Jan. 1 closes that gap for the more than 100 million people enrolled in such health plans across the United States, including the nearly 6 million Californians. And it covers millions more in all 32 states who either don’t have surprise bill laws or have laws that offer only partial protection.
The new federal law, the No Surprises Act, also protects nearly one million Californians not covered by a 2009 California Supreme Court ruling that bars emergency department doctors and other emergency service providers to charge HMO patients out-of-network charges not paid by their insurers – a practice known as balance billing.
“Millions more Californians will now be protected from these bills that are not only unfair but endanger the economic security of families,” said Anthony Wright, executive director of Health Access California, a consumer advocacy group.
It is high time. Surprise bills have inflicted financial hardship on millions of Americans for far too long.
When patients are seen by out-of-network providers they didn’t choose, it’s often a double whammy: they pay more out of pocket – even if their health plan covers some out-of-network care – and they can later receive balance bills from vendors that can total thousands of dollars.
Research shows surprise bills are common among the roughly 200 million US residents enrolled in private health plans.
A 2020 study found that 20% of privately insured patients who had elective surgery at a hospital that was part of their insurance network received surprise bills from providers who were not. Anesthesiologists’ bills averaged $1,219. Surgical assistant bills averaged more than double that amount.
“When patients pay their insurance premiums, they assume — and I think fairly presume — that they will be financially covered,” says Katie Berge, director of federal government affairs at the Leukemia & Lymphoma Society.
Unsurprisingly, the law covers everyone privately insured in employer-sponsored and individual/family health plans. Medicare and Medicaid already protect their enrollees from bad billing surprises.
The new federal law, which is largely in line with California’s, prohibits balanced billing for non-emergency care by out-of-network providers at in-network facilities and for most emergency room care at any establishment. Insurers must cover these services at network rates, and providers cannot charge patients additional amounts. Providers and health plans must negotiate how much the plan will pay, leaving patients out of the fray.
Federal law also protects against outrageous billing from out-of-network air ambulance services. A California law that took effect in January 2020 does the same. But it does not cover the millions of people in federally regulated health plans and has been vulnerable to possible legal challenge because it may clash with the 1978 airline deregulation, which included air ambulances.
Where its provisions are stricter, federal law will prevail over state laws.
What about execution? The federal government will defer to the states in cases involving state-regulated plans and in cases involving federally-regulated plans if the target of the complaint is a provider, says Loren Adler, associate director of the USC-Brookings Schaeffer Initiative for Health Policy. But the federal government will step in if states refuse or cannot enforce the law, he says.
Federal health officials are sending letters about the application to each state’s governors.
California, with its tough anti-surprise billing laws, certainly has the wherewithal and experience for enforcement, although it hasn’t seen a large number of cases. Over the past four years, the Department of Managed Healthcare has resolved 1,006 consumer complaints about balance billing, and 467 of them have resulted in total refunds of nearly $1 million to enrollees. , says Rachel Arrezola, spokeswoman for the department.
Of course, not all bills that surprise patients are regulated by federal or state law. Sometimes people owe more than they thought on their deductible, or their cost share was higher than they thought, or their procedure was not covered by their health insurance plan, or the he establishment they had chosen was not part of their network.
So upgrade your insurance policy. Know what it covers and who it covers, what facilities are in the network, how much your outgoings are and how much of your deductible is left to pay.
This will help you determine if a bill is illegitimate. And there will always be illegitimate invoices – because people make mistakes. And some health professionals act in bad faith.
When you get a bill, don’t pay it right away. To ask questions. Compare it with the explanation of benefits you receive from your insurer – and if it hasn’t happened yet, wait for it. If there’s a discrepancy between what your provider says and your health plan, call them both and try to resolve the issue.
If that doesn’t work, don’t be discouraged. You can file a complaint with your health insurance fund. And if that doesn’t solve your problem, contact the Department of Managed Health Care to open an appeal, either on their website (www.healthhelp.ca.gov) or by calling 1-888-466-2219. The department also has a fact sheet that may answer some of your questions about California surprise billing law.
The federal government has launched a website (www.cms.gov/nosurprises) that can answer many of your questions about the law without surprises and allow you to file a complaint or dispute a bill. You can also contact a “no surprises” Federal Helpline at 1-800-985-3059.
If you’re just confused by medical bills or lack the confidence to dispute one on your own, the Health Consumer Alliance is a great resource. Find an office near you by going to www.healthconsumer.org or by calling 1-888-804-3536.
Chow, originally from Hong Kong who has been a patient in the single-payer system there and in the UK, says she is confused by the US system, “where you pay for medical insurance, but then you have to pay more.”
Although California law doesn’t protect her from the anesthetist’s $2,000 bill and the new federal law isn’t retroactive, she nonetheless appears to be heading for a happy ending.
After three collection attempts by the anesthesiologist and several phone calls from Chow, Anthem agreed to lower the bill to $83 and update the anesthesiologist’s billing office. It still hasn’t happened, but Chow is hopeful.
“I don’t really understand what I’m responsible for,” she says, “except $83 is a lot less than $2,000.”
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