New Balance Billing Law in Colorado

[Hermit]

I went to the in-network hospital for xrays and was informed that Colorado now has a balance billing law that requires out-of-network doctors and technitians to accept in-network compensation from my insurance. I think this will make the billing process work a lot better in my state.

 

[travelover]

Excellent - now if only this was national.

 

[Bamaman]

Our local hospitals' emergency room doctors, radiologists and pathologists are often outside contractors without any agreements with insurance companies, etc.

In the region north of us, only one hospital chain employs anesthesiologists. All the other hospitals employ independent contractors that are out of network.

I applaud Colorado for changing their laws. Too bad so many patients get stuck paying more for services that are not covered by business relationships between insurance companies and doctors.

 

[The Cosmic Avenger]

I know the providers like to call it "balance billing", but I think we should call it what it is -- ambush billing.

Because it's ultimately not even about the fact that the amount is far more than insurance pays or that they're outside of the patient's network, it's that we as patients have no way to know or choose these factors to avoid it.

I do like the Colorado model, but if there is opposition to forcing in-network payment, I think stressing the unpredictability could help other states find solutions that still avoid the sticker shock...as long as that doesn't leave patients with no covered options.

 

[CRLLS]

Question, would the provider be forced to accept "in network" rates or "preferred network" rates? The problem I can see is that different insurance companies may have different in-network agreed rates for a particular service. Which rate would the out of network provider be required to accept?

It may take some time for this law to get clarified. I hope it does and the concept goes nationwide.

 

[MRG]

I'm glad it's been implemented. I remember one of my last managers at Megacorp. He had a big tumor in his head, like behind the face that needed out. A 14 hour surgery with a specialist who repaired his soft palate. He learned post surgery this guys in zero networks and wants 250k for his work. Megacorp was self insured and eventually paid the surgeon off but what if.

 

[travelover]

..........Which rate would the out of network provider be required to accept? ..........

How about the rate of the insured patient? It was good enough for everyone else involved.

 

[The Cosmic Avenger]

How about the rate of the insured patient? It was good enough for everyone else involved.

Yep. If the onus should be on anyone to know rate schedules or price lists, it should be on the health system, not the patient.

 

[pb4uski]

Excellent - now if only this was national.

+1 for those who are interested https://fas.org/sgp/crs/misc/LSB10284.pdf report on current state

 

[braumeister]

This thread title keeps messing with my head. I've worn New Balance shoes for decades and can't figure out why they would have to have a special law for their billing procedures.

 

[gerntz]

What stops hospitals/doctors from raising rates across the board to compensate their loss? Aren't they entitled to their fees?

 

[Odiedog]

Just a caveat, the new law only applies in 2 situations. There something about having a certain designation on your insurance card. It also mentions the law doesn't prevent providers from sending a bill for those charges, only for collecting. If you decide to get elective care out of network, you might still get stung.

There is a good explanation here: https://cohealthinitiative.org/need-help/surprise-medical-bills/

 

[pb4uski]

What stops hospitals/doctors from raising rates across the board to compensate their loss? Aren't they entitled to their fees?

They are entitled to the fees that they negotiate with health insurers, or to Medicare/Medicaid reimbursement rates.

What they are not entitled to is sneak their way into the service team of a patient getting services at an in-network hospital and using an in-network doc or specialist and charge much higher than negotiated rates and expect the patient to pay those higher rates. If they can't accept what the insurer or Medicare/Medicaid pay then they should step aside and let another health care provider who is willing to accept the negotiated rates.

 

[davebarnes]

This thread title keeps messing with my head. I've worn New Balance shoes for decades and can't figure out why they would have to have a special law for their billing procedures.

Looking forward to the Adidas and Puma laws—which will be in Deutsch.

 

[MichaelB]

Just a caveat, the new law only applies in 2 situations. There something about having a certain designation on your insurance card. It also mentions the law doesn't prevent providers from sending a bill for those charges, only for collecting. If you decide to get elective care out of network, you might still get stung.

There is a good explanation here: https://cohealthinitiative.org/need-help/surprise-medical-bills/

Great link, thanks.

 

[pb4uski]

But this makes no sense at all. It says in one breath that they can only charge you the in-network rate but in the next breath that they can send you a balance bill. How can the be allowed to send you a bill for an amount that they can't charge you for by statute?

If they send it to collections do you they say that it is not a valid debt? and that is the end of it?

Sounds like what they are doing is saying if you know what you are doing and are paying attention that you're only responsible for the negotiated rate but if you're ignorant or not paying attention and the medical service provider can sucker you into paying a balance bill then that is a-ok. What a crock of cow dung! Colorado legislators should be ashamed of themselves.

Specifically, patients can only be charged at the in-network rate. (The Colorado Revised Statutes where these protections can be found are C.R.S. 10-16-704 sections 3 and 5.5) That means that if you would have owed a $50 copay for the services in-network, then you don’t owe more than $50 if your provider is unexpectedly out-of-network.

Be aware, though, that Colorado law does not prohibit providers from sending balance bills to consumers. In these situations, consumers can unknowingly pay bills they may not be responsible for and should instead contact their insurer to resolve. This is why it’s always good to double-check which bills you have to pay before paying them. Below is some advice to help you avoid this situation.

 

[MichaelB]

But this makes no sense at all. It says in one breath that they can only charge you the in-network rate but in the next breath that they can send you a balance bill. How can the be allowed to send you a bill for an amount that they can't charge you for by statute?

If they send it to collections do you they say that it is not a valid debt? and that is the end of it?

Sounds like what they are doing is saying if you know what you are doing and are paying attention that you're only responsible for the negotiated rate but if you're ignorant or not paying attention and the medical service provider can sucker you into paying a balance bill then that is a-ok. What a crock of cow dung! Colorado legislators should be ashamed of themselves.

Lighten up. It’s standard practice for heath care providers to bill amounts far in excess of the agreed price, even for insured patients.

 

[RetMD21]

If they can't accept what the insurer or Medicare/Medicaid pay then they should step aside and let another health care provider who is willing to accept the negotiated rates.

Medicare has a price list. You can't legally "balance bill" Medicare/Caid patients (you can bill them for the deductibles and copays)

 

[pb4uski]

^^^^ Might be true in your state but not universal. From a Congressional Research Service document on balance billing:

... Under Medicaid, providers generally cannot balance bill Medicaid beneficiaries if the providers have already billed and accepted payment from Medicaid. In contrast, under Medicare, a provider’s ability to balance bill depends on whether he is a “participating” provider. A participating provider cannot balance bill Medicare beneficiaries because they have accepted the beneficiary’s assignment of Medicare benefits and Medicare’s approved payment amounts as full payment for the Medicare-covered services. Meanwhile, nonparticipating providers, who accept Medicare but have not agreed to accept assignment (i.e., they do not accept Medicare’s approved amount for health care services as full payment), can generally balance bill a Medicare beneficiary, but the amount cannot exceed more than 15 percent of the Medicare-approved payment amount for nonparticipating physicians for the service. ...

https://fas.org/sgp/crs/misc/LSB10284.pdf

 

[pb4uski]

Lighten up. It’s standard practice for heath care providers to bill amounts far in excess of the agreed price, even for insured patients.

True on the initial bill because it is subject to adjudication with the insurer.... but after the in-network provider has been paid by the insurer they typically show the rack rate, a discount for the difference between their rack rate and the negotiated rate and also the amount paid by the insurer and the balance due from the patient... which will generally agree to the insurer's EOB and the patient that is paying attention then knows that it is probably ok to pay.

Similarly, a rack rate bill is acceptable because it is subject to adjudication with the insurer. But after that adjudication, the out-of network provider will show the rack rate, the amount paid by the insurer and then the difference even though by law they can't collect the entire difference and they can only collect the excess of the negotiated rate over what the insurer paid.

It doesn't trouble you that a provider can bill for something that statute says that they can't collect?

It seems to be dancing on fraud to me:

Fraud is generally defined in the law as an intentional misrepresentation of material existing fact made by one person to another with knowledge of its falsity and for the purpose of inducing the other person to act, and upon which the other person relies with resulting injury or damage.

The out-of-network provider is intentionally misrepresenting that and amouis due that they don't have the legal right to collect.... to induce the patient to pay them money that they are not legally entitled to... which results in economic damages to the ignorant patient that pays the bill.

 

[RetMD21]

^^^^ Might be true in your state but not universal. From a Congressional Research Service document on balance billing:

Good point! they can bill for the less than 15% they are allowed above the Medicare payment amout. What I meant to say is that they can't bill for the difference between their exorbitant "list price" and the Medicare amount.

Also if they are nonparticipating the patient is paid by Medicare. Not many physicians doing the nonparticipating track.

 

[MichaelB]

True on the initial bill because it is subject to adjudication with the insurer.... but after the in-network provider has been paid by the insurer they typically show the rack rate, a discount for the difference between their rack rate and the negotiated rate and also the amount paid by the insurer and the balance due from the patient... which will generally agree to the insurer's EOB and the patient that is paying attention then knows that it is probably ok to pay.

Similarly, a rack rate bill is acceptable because it is subject to adjudication with the insurer. But after that adjudication, the out-of network provider will show the rack rate, the amount paid by the insurer and then the difference even though by law they can't collect the entire difference and they can only collect the excess of the negotiated rate over what the insurer paid.

It doesn't trouble you that a provider can bill for something that statute says that they can't collect?

It seems to be dancing on fraud to me:
The out-of-network provider is intentionally misrepresenting that and amouis due that they don't have the legal right to collect.... to induce the patient to pay them money that they are not legally entitled to... which results in economic damages to the ignorant patient that pays the bill.

Many things trouble me about the health care system. I think the Colorado legislature took a big step in the right direction to overrule a practice that is deeply exploitative, and your previous post was too harsh on the lawmakers. To say a balance bill is now fraud is excessive, especially since the new law protects some patients and disallows the excess charges in some cases but not others. Balance billing is still allowed in some cases in Colorado.

Health care providers, especially hospitals, have so many different prices there is no list price or rack rate. The price for an uninsured or underinsured patient can be 15x or 20x the Medicare or insurance contract rate and can differ by a factor of 2x or 3x from similar local or regional hospitals, yet they routinely send out these monsterous bills and demand payment, even when they know the contracted price is 80%-90% less. The pricing, billing and collection of health care follows few rules.

I agree that sending a balance bill that no longer applies should be discouraged. If a provider makes an effort to misrepresent the bill, I would agree it is a matter for regulator action. The Colorado balance billing act, with all its warts and shortcomings, is a positive step for insurers and consumers alike, and I applaud their effort.