New Jersey-2012-A245-Introduced

An Act concerning health benefits plans, and amending and supplementing various parts of the statutory law.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. (New section) This act shall be known and may be cited as the "Health Care Transparency and Disclosure Act."

2. (New section) As used in sections 3 through 7 of this act:

"Carrier" means an insurance company, health service corporation, hospital service corporation, medical service corporation or health maintenance organization authorized to issue health benefits plans in this State.

"Covered person" means a person on whose behalf a carrier or entity providing a self-funded health benefits plan is obligated to pay benefits or provide services pursuant to the health benefits plan.

"Health benefits plan" means a benefits plan which pays or provides hospital and medical expense benefits for covered services, and is: (1) delivered or issued for delivery in this State by or through a carrier; or (2) offered in this State by an entity providing a self-funded health benefits plan. Health benefits plan includes, but is not limited to, Medicare supplement coverage and risk contracts to the extent not otherwise prohibited by federal law. For the purposes of this act, health benefits plan shall not include the following plans, policies or contracts: accident only, credit, disability, long-term care, CHAMPUS supplement coverage, coverage arising out of a workers' compensation or similar law, automobile medical payment insurance, personal injury protection insurance issued pursuant to P.L.1972, c.70 (C.39:6A-1 et seq.), and hospital confinement indemnity coverage.

"Health care facility" means a hospital or other health care facility licensed pursuant to P.L.1971, c.136 (C.26:2H-1 et seq.).

"Physician" means a physician licensed by the State Board of Medical Examiners to practice medicine and surgery pursuant to chapter 9 of Title 45 of the Revised Statutes.

3. (New section) a. A physician or health care facility delivering out-of-network health care services under a health benefits plan shall make a good faith and timely effort to collect each covered person's liability, including any deductible, copayment, or coinsurance, owed by a covered person to the physician or facility pursuant to the terms of the covered person's health benefits plan. For the purposes of this section, a physician or health care facility shall be deemed to have made a good faith and timely effort to collect the covered person's liability if the physician or facility makes three good faith attempts to collect.

b. A physician shall retain all records relating to any attempt to collect a covered person's liability pursuant to subsection a. of this section for at least seven years following the date on which the record is made. All such records shall be open to inspection, upon request, by the Department of Banking and Insurance.

c. Notwithstanding subsection a. of this section:

(1) a physician or health care facility delivering out-of-network health cares services under a health benefits plan may waive a covered person's financial responsibility if:

(a) the waiver occurs after a finding by the physician or facility that the covered person has a medical or financial hardship; and

(b) such waivers are not granted by the physician or health care facility routinely or excessively.

(2) a health care facility may waive a covered person's financial responsibility if the waiver is made in accordance with the terms of an advisory opinion issued by the Office of the Inspector General for the United States Department of Health and Human Services to a licensed or certified health care facility pursuant to subsection (b) of section 1128D of the Social Security Act, Pub.L. 104-191 (42 U.S.C. s.1320a-7d) that expressly permits the facility to engage in routine waiver of deductibles, copayments, or coinsurance due to the health care facility's recognized historical or continued charitable mission.

For the purposes of this subsection, "medical hardship" means that the covered person is unable to make payment due to a medical condition, physical or behavioral, that has left the covered person unable to make payment, or direct that payment be made, or has left the covered person unable to comprehend that payment is required.

d. With regard to a decision to waive a covered person's financial responsibility pursuant to paragraph (1) of subsection c. of this section, the physician or facility shall: (1) notify the carrier or entity providing a self-funded health benefits plan whenever waiver is made; and (2) retain any records relating to the decision to waive in the patient's record.

4. (New section) a. A carrier which offers a health benefits plan or an entity which offers a self-funded health benefits plan shall establish and maintain a website to serve as an information clearinghouse for covered persons to obtain information to assist them in their health care needs. The link to the website shall be prominently displayed on the back of each health benefits card issued to a covered person. For the purposes of this section, a "health benefits card" means a card issued to a covered person for the limited purpose of obtaining health care services under a health benefits plan.

b. The website shall be updated regularly and shall include, but not be limited to:

(1) links to quality rankings that are produced, audited, and publicly reported by State and federal agencies for physicians, which rankings shall be provided in a manner to be prescribed by the Department of Banking and Insurance, in consultation with the State Board of Medical Examiners, the Division of Consumer Affairs, and the Department of Health and Senior Services;

(2) for each health benefits plan offered in this State, a clear and understandable description of the plan's out-of-network health care benefits, including a covered person's financial responsibility for those benefits; and

(3) such other information as the Department of Banking and Insurance determines appropriate and necessary to ensure that a covered person receives sufficient information necessary to make a well-informed health care decision.

c. The website shall contain links to the information set forth in subsection b. of this section. Each link shall be prominently displayed on the website in at least 14 point font to ensure each link is easily accessible by covered persons and those seeking the information set forth in subsection b. on the website.

d. The provisions of this section shall not apply to a health maintenance organization with respect to its contract with Medicaid.

5. (New section) a. A health care facility shall, when scheduling an appointment with a covered person, disclose to that person whether the health care services delivered by the health care facility are in-network or out-of-network with respect to that person's health benefits plan.

b. The disclosure required pursuant to subsection a. of this section shall inform the covered person that the covered person may have a financial responsibility, including any applicable deductibles, copayments, and coinsurance, for the receipt of health care services under the terms of the covered person's health benefits plan.

c. A health care facility delivering out-of-network health care services for any non-emergency or elective procedure shall, prior to delivering the health care services and in terms the covered person typically understands, provide the covered person receiving those services with a clear and understandable: (1) description of the procedure; (2) estimate of the costs for those services to be charged by that facility; and (3) notice to the covered person to contact his health insurance carrier for further consultation on the costs of the procedure.

d. The Department of Health and Senior Services may specify the manner in which the description of the procedure and the cost estimate required by subsection c. of this section shall be provided.

e. A health care facility that fails to comply with this section is liable for action by the Department of Health and Senior Services pursuant to section 13 of P.L.1971, c.136 (C.26:2H-13).

6. (New section) a. A physician shall, when scheduling an appointment with a covered person to provide health care services, disclose to that person whether the physician is in-network or out-of-network with respect to the person's health benefits plan.

c. A physician delivering out-of-network health care services for any non-emergency or elective procedure shall, prior to delivering the health care services and in terms the covered person typically understands, provide the covered person receiving those services with a clear and understandable: (1) description of the procedure; (2) estimate of the costs for those services to be charged by that physician; and (3) notice to the covered person to contact the covered person's health insurance carrier for further consultation on the costs of the procedure.

d. The State Board of Medical Examiners may specify the manner in which the description of the procedure and the cost estimate required by subsection c. of this section shall be provided.

e. A physician who fails to comply with this section is liable for action by the State Board of Medical Examiners pursuant to R.S. 45:9-1 et seq.

7. (New section) a. A physician or health care facility may file a complaint with the Office of the Insurance Claims Ombudsman in the Department of Banking and Insurance, on a form prescribed by the ombudsman, based on a determination pursuant to subsection d. of section 2 of P.L.2001, c.367 (C.26:2S-6.1) to exempt the physician or health care facility from the provisions of subsection c. of section 2 of P.L.2001, c.367 (C.26:2S-6.1).

b. Upon the filing of a complaint, the ombudsman may, in a manner consistent with sections 47 through 61 of P.L.1998, c.21 (C.17:29E-1 et seq.), and within a reasonable time:

(1) Conduct an investigation regarding any alleged violations of any of the provisions of section 3 of P.L. , c. (C. ) (pending before the Legislature as this bill);

(2) Compel the physician, health care facility, the carrier, the entity providing a self-funded health benefits plan, or any covered person to produce at a specific time and place, by subpoena, any documents, books, records, papers, objects or other evidence which he believes may relate to the investigation; and

(3) Hold a hearing.

c. The ombudsman shall, within a reasonable time, affirm or reverse the determination pursuant to subsection d. of section 2 of P.L.2001, c.367 (C.26:2S-6.1), to exempt the physician or health care facility from the provisions of subsection c. of section 2 of P.L.2001, c.367 (C.26:2S-6.1). The decision shall be based on a finding as to whether the physician or health care facility violated any of the provisions of section 3 of P.L. , c. (C. ) (pending before the Legislature as this bill) and whether that violation warrants exemption from the provisions of subsection c. of section 2 of P.L.2001, c.367 (C.26:2S-6.1). The ombudsman shall report his decision and a statement of his findings of fact to the physician or health care facility and the carrier or the entity providing the self-funded health benefits plan, as appropriate.

d. The ombudsman shall calculate the costs of any hearing or investigation and notify the non-prevailing party of those costs. The non-prevailing party shall reimburse the ombudsman for those costs within 30 days of receiving the notice of the ombudman's decision.

8. Section 2 of P.L.2001, c.367 (C.26:2S-6.1) is amended to read as follows:

2. a. With respect to a carrier which offers a managed care plan that provides for both in-network and out-of-network benefits, in the event that:

(1) a covered person is admitted by an out-of-network health care provider to an in-network health care facility for covered, medically necessary health care services; or

(2) the covered person receives covered, medically necessary health care services from an out-of-network health care provider while the covered person is a patient at an in-network health care facility and was admitted to the health care facility by an in-network provider, the carrier shall reimburse the health care facility for the services provided by the facility at the carrier's full contracted rate without any penalty for the patient's selection of an out-of-network provider, in accordance with the in-network policies and in-network copayment, coinsurance or deductible requirements of the managed care plan.

b. The provisions of subsection a. of this section shall apply only if the covered person complies with the preauthorization or review requirements of the health benefits plan regarding the determination of medical necessity to access in-network inpatient benefits, as set forth in writing pursuant to section 5 of P.L.1997, c.192 (C.26:2S-5).

c. With respect to a carrier which offers a managed care plan or an entity which offers a self-funded health benefits plan that provides for both in-network and out-of-network benefits, in the event that the covered person assigns, through an assignment of benefits, his right to receive reimbursement for medically necessary health care services to an out-of-network health care provider, physician or health care facility, the carrier or entity shall remit payment for the reimbursement directly to the health care provider, physician or facility in the form of a check payable to the health care provider, physician or facility or in the alternative, to the health care provider, physician or facility and the covered person as joint payees, with a signature line for each of the payees. Payment shall be made in accordance with the provisions of this section and P.L.1999, c.154 (C.17B:30-23 et al.). Any payment made only to the covered person rather than the health care provider, physician or facility under these circumstances shall be considered unpaid, and unless remitted to the health care provider, physician or facility within the time frames established by P.L.1999, c.154 (C.17B:30-23 et al.), shall be considered overdue and subject to an interest charge as provided in that act.

d. (1) The provisions of subsection c. of this section pertaining to the right of an out-of-network physician or facility to receive payment for reimbursement directly from a carrier or an entity which offers a self-funded health benefits plan shall not apply if a carrier or entity determines that a physician or health care facility has violated any of the provisions of section 3 of P.L. , c. (C. )(pending before the Legislature as this bill).

(2) The carrier or entity shall not make such a determination unless the physician or facility commits a pattern of violations of any of the provisions of section 3 of P.L. , c. (C. )(pending before the Legislature as this bill) for a period of at least six months. If the carrier or entity makes such a determination, the carrier or entity shall notify the physician or facility 30 days in advance of exempting the physician or facility from the provisions of subsection c. of this section. The exemption shall not exceed a period of one year from the date of the notification.

(3) A physician or facility exempted from the provisions of subsection c. of this section shall have the right to appeal such a determination to the Office of the Insurance Claims Ombudsman in the Department of Banking and Insurance pursuant to section 7 of P.L. , c. (C. ) (pending before the Legislature as this bill).

(4) The carrier or entity shall not make a determination to exempt a physician or facility pursuant to this subsection until six months after the effective date of P.L. , c. (C. ) (pending before the Legislature as this bill).

e. For the purposes of this section, "physician" and "health care facility" shall have the same meanings as provided in section 2 of P.L. , c. (C. ) (pending before the Legislature as this bill). "Facility" shall have the same meaning as "health care facility."

(cf: P.L.2009, c.209, s.1)

9. Section 8 of P.L.1997, c.192 (C.26:2S-8) is amended to read as follows:

8. A carrier which offers a managed care plan shall establish a policy governing removal of health care providers from the provider network which includes the following:

a. The carrier shall inform a participating health care provider of the carrier's removal policy at the time the carrier contracts with the health care provider to participate in the provider network, and at each renewal thereof.

b. If a licensed health care professional's participation will be terminated prior to the date of the termination of the contract, the carrier shall provide the health care professional with 90 days' written notice of the termination and notice of a right to a hearing. If requested by the health care professional, the carrier shall provide the reasons for the termination in writing, and shall hold a hearing within 30 days of the date of the request. The hearing shall be conducted by a panel appointed by the carrier, which panel shall be comprised of a minimum of three persons, at least one of whom is a clinical peer in the same discipline and the same or similar specialty as the health care professional being reviewed. The panel shall make a decision that: (1) the health care professional shall be terminated, or (2) the health care professional shall be reinstated or provisionally reinstated, subject to conditions set forth by the panel. The panel's determination shall be in writing and shall be made in a timely manner. Participation in this process shall not be deemed to be an abrogation of the health care professional's legal rights.

The notice required and opportunity for a hearing pursuant to this subsection shall not apply in those cases when the contract expires and is not renewed, the termination is for breach of contract, in the opinion of the medical director, the health care professional represents an imminent danger to an individual patient or the public health, safety or welfare, or there is a determination of fraud.

c. If the carrier finds that a health care professional represents an imminent danger to an individual patient or to the public health, safety or welfare, the medical director shall promptly notify the appropriate professional State licensing board [. Notification to the State Board of Medical Examiners shall be subject] pursuant to the provisions of [section 5 of P.L.1989, c.300 (C.45:9-19.5)] the "Health Care Professional Responsibility and Reporting Enhancement Act," P.L.2005, c.83 (C.45:1-33 et seq.).

d. The carrier shall not terminate participation of a health care provider based on a determination that the provider referred a covered person to an out-of-network health care provider, except that this restriction shall not apply to a health maintenance organization with respect to a Medicaid contract.

(cf: P.L.1997, c.192, s.8)

10. This act shall take effect on the 90^th day next following enactment.

STATEMENT

This bill, which is designated the "Healthcare Transparency and Disclosure Act," makes various changes to the administration of health benefits plans, regarding: (1) out-of-network payment collection responsibilities by physicians and health care facilities under insured and self-funded health benefits plans; (2) certain consumer disclosures by physicians, health care facilities and health plan providers; and (3) eligibility for participation in health insurance plan networks.

The bill requires physicians and health care facilities delivering out-of-network services to make a good faith and timely effort to collect each covered person's liability, including any deductible, copayment, or coinsurance owed by the covered person to the physician or health care facility pursuant to the terms of the covered person's health benefits plan. The bill provides that a good faith and timely effort to collect means three good faith attempts to collect.

The bill also requires the physician and facilities to retain and make available for inspection by the Department of Banking and Insurance, all records relating to any attempt to collect a covered person's liability for at least seven years following the date on which the record is made.

The bill provides, however, that a physician or facility delivering out of network services may waive a covered person's financial responsibility if: (1) the physician or facility determines that the covered person has a medical or financial hardship; and (2) such waivers are not granted routinely or excessively. Under the bill, a medical hardship means that the covered person is unable to make payment due to a medical condition, physical or behavioral, that has left the covered person unable to make payment, or direct that payment be made, or has left the covered person unable to comprehend that payment is required.

Also, a health care facility may waive a covered person's financial responsibility as to the facility if the waiver is made in accordance with the terms of an advisory opinion issued by the Office of the Inspector General for the United States Department of Health and Human Services to a licensed or certified health care facility pursuant to subsection (b) of section 1128D of the Social Security Act, Pub.L. 74-271 (42 U.S.C. s.1320a-7d) that expressly permits the facility to engage in routine waiver of deductibles, copayments, or coinsurance due to the health care facility's recognized historical or continued charitable mission.

The bill requires the physician or facility to notify the carrier or the entity providing a self-funded health benefits plan whenever the physician or facility waives a covered person's financial responsibility and retain any records relating to such a decision in the patient's record.

The bill allows a carrier or entity providing a self-funded health benefits plan, if the carrier or entity determines that a physician or facility has committed a pattern of violations of section 3 of the bill concerning waivers of payment by a covered person, to exempt the physician or facility from the provision of law which gives an out-of-network health care provider the right to receive payment for reimbursement directly through an assignment of benefits. Under the bill, the carrier or entity is required to notify the physician or facility 30 days in advance of exempting the physician or facility and the exemption is not permitted to exceed a period of one year from the date of the notification. The bill further provides that a determination imposing the exemption may not be made until six months after the effective date of this bill.

The bill also provides that a physician or facility has the right to appeal such a determination to the Office of the Insurance Claims Ombudsman in the Department of Banking and Insurance. The bill establishes a procedure for such an appeal and provides the ombudsman with authority, within a reasonable period of time, to conduct an investigation, hold a hearing, and render a binding decision as to upholding or overturning the determination. The bill also requires the non-prevailing party to reimburse the ombudsman for the costs of the investigation and hearing.

This bill requires providers of health benefits plans to establish and maintain a website to serve as an information clearinghouse for covered persons to obtain information to assist them in their health care needs. A link to the website must be featured and prominently displayed on the back of each health benefits card issued to covered persons to ensure that they are aware of the website. Specifically, the bill requires the websites to have: (1) links to quality rankings that are produced, audited, and publicly reported by State and federal agencies for physicians, which rankings shall be provided in a manner to be prescribed by the Department of Banking and Insurance, in consultation with the State Board of Medical Examiners, the Division of Consumer Affairs, and the Department of Health and Senior Services; (2) for each health benefits plan offered in this State, a clear and understandable description of the plan's out-of-network health care benefits, including a covered person's financial responsibility for those benefits; and (3) any other information that the Department of Banking and Insurance determines is appropriate and necessary to ensure that covered persons receive sufficient information needed to make well-informed health care decisions. The bill also prescribes a minimum font size and location for each link featuring the information prescribed.

This bill requires physicians and health care facilities, when scheduling an appointment with a covered person, to disclose whether the health care services are in-network or out-of-network with respect to that person's health benefits plan and that there may be a financial responsibility of the covered person, including applicable deductibles, copayments and coinsurance. The bill also requires the facility or physician, if providing out-of-network services, to provide to the covered person, in a clear and understandable manner and in the terms the covered person typically understands, the following: (1) a description of the procedure; (2) an estimate of the costs charged by the physician or facility for those services; and (3) a notice to contact their insurance carrier for further consultation on the costs of the procedure.

The bill also amends the "Health Care Quality Act" by adding to the current policies governing when a health insurance carrier can remove a health care provider from a provider network. The bill provides that the carrier shall not terminate participation of the provider based on a determination that the provider referred a covered person to an out-of-network health care provider.