California Proposes Ban On 'Balanced Billing' By Health Insurers For Emergency Care

Main Category: Health Insurance / Medical Insurance
Also Included In: Primary Care / General Practice;  Public Health
Article Date: 03 Apr 2008 - 9:00 PDT

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The California Department of Managed Health Care on Friday released draft regulations that would bar physicians and hospitals from billing patients for the cost of services above what their HMOs are willing to pay, the Los Angeles Times reports. The draft regulations are an attempt by Gov. Arnold Schwarzenegger's (R) administration to ban the practice known as "balance billing" by physicians who often work in hospitals but do not have contracts with the same HMO as the hospital. Some doctors -- who mostly are emergency department physicians, radiologists and anesthesiologists -- believe payments they receive from insurers are too low and send bills to patients for the difference, according to the Times. Patients may wrongly assume that the bill is for their copayment and is authorized by their HMO.

While "balance billing" is regulated in eight states, legislation to regulate the practice in California has "repeatedly died" in the state Legislature, according to the Times. State HMO regulators have spent the past two years working on a compromise between insurers and providers but were unable to reach an agreement. DMHC Director Cindy Ehnes said, "We tried to say, when we were young and naive, that we could find a mutually acceptable resolution to make sure physicians were being paid fairly and on time," adding, "We finally said, 'We can't solve this marketplace dispute, but what we can do is our core mission of protecting consumers.'"

Under the proposed regulations, California hospitals and hospital-based physicians would be barred from billing patients for the cost of emergency care that is covered under their health plans. A public comment period on the regulations ends May 12. The state Assembly also is considering legislation (SB 981) that would ban balance billing and require HMOs to give physicians an interim payment and establish a method for resolving disputes.

The California Medical Association opposes the ban, saying that if the regulations are approved, physicians might send entire hospital bills to patients rather than deal with insurers. In addition, Francisco Silva, general counsel for the association, said specialists would be less inclined to be on call for emergencies if the regulations are approved (Rau, Los Angeles Times, 4/1).

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