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CLIENT ALERT: The “Out-of-network Consumer Protection, Transparency, Cost Containment and Accountability Act” Passes Both Houses of the New Jersey Legislature

A bill intended to rein in out-of-network charges and promote transparency regarding insurance coverage and physician and hospital fees is headed to governor Phil Murphy’s desk this week after nearly a decade of debate. The bill contains a number of provisions which will have a serious impact on all licensed New Jersey healthcare providers, especially those who own medical facilities such as Ambulatory Surgical Centers (ASC’s). A few of the changes in the bill which are pertinent to providers include:

NEW NOTICE REQUIREMENTS & CAPS ON CHARGES:

For non-emergency patients, the bill requires the provider/facility to provide a plethora of additional information at the time the patient is scheduling their appointment. These include the in or out-of-network status of the provider/facility as well as a disclaimer regarding the responsibility of the patient to pay any additional out-of-network fees. The bill also requires that the provider/facility provide each patient, upon request, an estimate of fees, as well as a schedule of the CPT codes anticipated to be used during their course of treatment (and the provider’s cost for each code). 

The bill also notes that unless the patient “knowingly, voluntarily and specifically selected an out-of-network provider to provide services” following these disclosures, the provider/facility is prohibited from charging the patient any out-of-pocket expenses above those which would have been payable had the provider been in-network. Further, any such bills, charges or attempts to collect above the co-payment, deductible or co-insurance constitute a violation of the law.

EMERGENCY CARE BILLING RESTRICTIONS:

The bill has also introduced a number of changes to how New Jersey providers/facilities may bill in situations deemed to be an “emergency or urgent basis” under the Emergency Medical Treatment and Active Labor Act (EMTALA). Generally, these changes restrict the amount a provider/facility may charge to the “deductible, copayment, or coinsurance amount applicable to in-network services pursuant to the covered person’s health benefits plan.” The bill also permits the carrier or out-of-network provider to initiate binding arbitration to resolve certain payment disputes.

NEW WEB NOTICE REQUIREMENTS:

Under the new bill, each New Jersey healthcare facility’s website must now provide a variety of up-to-date information such as:

  • Provider Information: Facilities must provide the address and phone number of all physicians employed by, or providing services at, the Facility, along with the benefit plans they participate in.
  • Additional Providers: The names, practice names, addresses and phone numbers of any provider scheduled to perform anesthesiology, laboratory, pathology, radiology and assistant surgeon services must also be listed.
  • Provider/Facility Changes in Network Status: These requirements differ depending on where the patient is in their course of treatment but notice is generally required within 20 days of a change.

In addition to the fee caps discussed above, the bill also carries with it a number of penalties for non-compliance. These can range from $1,000 per violation per day for health care facilities, up to $25,000 per occurrence, and $100 per violation per day, up to $2,500 for each occurrence, for all other persons or providers. 

The bill applies only to state-regulated insurance plans, which account for less than half of the insured population in New Jersey. But other health plans, such as those used by self-insured employers or unions, may “opt in” and choose to be bound by its provisions. Following signature by Governor Murphy, the bill is scheduled to become effective in 90 days. As payors will almost certainly utilize the new requirements set forth in the bill to limit payments, New Jersey Providers and their businesses should act immediately to put adequate systems in place insuring compliance and minimizing any potential losses or penalties.

At Frier Levitt, we can help you understand these requirements as well as implement policies and practices to reduce the risk of losses or penalties due to non-compliance. If you are interested in learning more, contact Frier Levitt today to speak to an attorney.