Update on Surprise/Out of Network Billing


As our clients know, Massachusetts and other States are in the process of addressing what is known as Surprise (“S”) or Out of Network (“OON”) Billing.  The ultimate results of this Legislation could have a significant impact on how physicians in Massachusetts contract with local third party payors.  HMA recently met with a prominent MA based attorney (“Esq.”) that has a unique understanding of the current status of this Legislation.  Here is a summary of our discussion. 


In the last legislative session, Surprise/OON billing was included in a much larger Bill that included revenue sharing for certain low income hospitals. That bill died in conference committee.


This year, the S/OON likely will be separately addressed.


Since there have been no hearings in 2019 as yet, Esq. predicts that it will be addressed in the Fall of 2019, and if passed, implementation will likely be at the beginning of 2020.


He also said that the entire discussion/decision/ implementation process could go later into 2020.


Last year’s House bill stated that, if a physician or group isn’t participating, they would be required to accept the higher of 115% of the Commercial Insurer’s “average rate paid” or 125% of Medicare.


Last year’s Senate bill stated that the Health Policy Commission would set an OON rate.


Esq. is concerned about the members of the Health Policy Commission (“HPC”) who don’t seem to understand/care about the impact on Physicians, although Esq. stated that the staff members at the HPC do indeed have a good understanding.


The insurance companies are pushing for 100-110% of Medicare.


Esq. noted that this legislation may not apply to “self-funded/insured” plans.


Esq. also stated that case by case “arbitration” might also be an option.


The Financial Services Committee of the MA Legislature is holding a hearing on the OON bills on May 7.


Obviously this is still a work in progress.  Definitions for “average rate paid” and “arbitration” methodologies are unclear.  If the average rate paid includes both statewide and enhanced rates for the major payors, the impact of remaining non-par (with the blessing of the Hospital) may be less severe.


Esq. finally stated that predicting what the  Commonwealth of MA Legislature will do and timing of their actions is complicated as there are numerous variables and stakeholders involved.


We will continue to post updates as more information becomes available.


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