End of General Assembly 2019: Balance Billing Update

The top issue for VACEP during the 2019 legislative session has been surprise billing and out-of-network coverage. We began working on this issue in early 2018, with the goal of protecting both patients and a physicians’ ability to negotiate fairly with health plans. Ultimately, when the 2019 legislative session adjourned this past weekend, no legislation passed addressing the issue of balance billing. For a more detailed description of the steps we’ve taken along the way, please read the full summary included at the end of this article.

For those who have been following the process closely, here is the latest update:

Latest Update

VACEP members with the patron of our bill, Del. Lee Ware.

As you know, we were successful in defeating the health plans’ legislation, which would have prohibited balance billing and forced providers to accept the in-network rate. This was a huge victory for the physician community.

Defeating insurance companies was an uphill battle from the start, and we were up against negative stories in the media and a lot of misinformation being put out by the health plans. Luckily, legislators recognized that a flat-out ban on balance billing in the emergency department would severely threaten the emergency safety net.

We were able to offer a compromise solution, that was strongly supported by physicians, hospitals and patient advocacy groups. Our legislation would have prohibited balance billing in the emergency department, but also would also have required a fair reimbursement for providers. The bills also contained other significant patient protection components. Delegate Lee Ware and Senator Glen Sturtevant carried our legislation and we were thrilled when they both passed their respective Commerce and Labor committees overwhelmingly.

Unfortunately, there were questions at the very end about whether there would be a fiscal impact on the state health plan.

The health plans raised concerns that our legislation would increase the cost of the state employee health plan, because providers would be incentivized to go out-of-network. We strongly disagreed with this assessment, as did several legislators. But in the end, some felt there was still an indeterminate fiscal impact, and it would be prudent to not pass the legislation as this time.

When the 2019 legislative session adjourned this past weekend, no legislation passed addressing the issue of balance billing. Virginia law still allows physicians to balance bill and negotiate with health plans. While we are disappointed that our reasonable solution did not make it to the finish line, we are grateful that the General Assembly chose to not act negatively on this issue. A straight ban on balance billing would have been detrimental to emergency physicians’ ability to practice in Virginia and would have harmed the emergency safety net.

Unfortunately, extremely concerning language was included in the final budget adopted in the form of a conference committee report. This means it only gets an up or down vote on the floors of the House and Senate and no amendments could be made. The language specifically creates a workgroup with NO physician or hospital members:

“to develop a proposal to determine the equitable and fair reimbursement to out-of-network health care providers for emergency services rendered, which shall be based on a percentage above the Medicare Fee Schedule for equivalent services. The out-of-network services rate developed by the workgroup shall be a recommendation for consideration by the General Assembly for future legislation to prohibit the practice of balance billing by out-of-network emergency services health care providers….no later than November 15, 2019.”

We have already begun working with our allies and reaching out to the Governor’s office to request a re-write of this language.

Background Information and Extended Update

The physician community has been diligently working on the issue of surprise billing and out-of-network coverage over the past year. It began during the 2018 legislative session, when Delegate Kathy Byron introduced legislation that would have prohibited providers from billing patients for out-of-network ancillary services at a higher rate than the in-network rate. It also would have required the providers to disclose to patients that the ancillary services are out-of-network. Delegate Byron had received her own large bill for out-of-network lab services and wanted to address it.

Trisha Anest, M.D., FACEP lobbies a legislative aide during White Coats on Call.

The physician community was able to convince the patron to not pursue the legislation at that time, and to allow the stakeholders to work on this issue in the interim.

We began to meet with other stakeholders and discuss potential solutions. In July 2018, the Health Insurance Reform Commission scheduled a meeting to address this issue. Around the same time, local news stations started highlighting stories of patients who had been balance billed. Many of the stories were situations in which a patient went to the emergency department at an in-network hospital but received care from an out-of-network physician.

At the HIRC meeting, the legislators made it very clear that this type of scenario – where the patient had no control – is unacceptable and must be addressed. They instructed us to work with the health plans and find a solution – otherwise, they would pick one for us that no one would like.

Over the next few months, we worked in good faith with the health plans to try and find a compromise that would protect the patient from balance billing in the emergency department, but still retain physicians’ abilities to negotiate for a fair reimbursement with health plans. Unfortunately, the health plans were not willing to compromise on the issue of emergency services.

We knew we would have an uphill battle ahead at the 2019 legislative session. We worked with the hospitals and patient advocates to come up with a reasonable solution we could all support. Delegate Ware and Senator Sturtevant introduced legislation on our behalf that does the following:

  • Requires health plans to pay providers a fair and reasonable reimbursement based on regional, average payments from 2017.
  • Banned balance billing in the emergency department
  • Required health plans to pay providers directly
  • Ensures care is covered regardless of the final diagnosis

The health plans supported legislation introduced by Senator Wagner and Delegate Byron that banned balance billing in the emergency department, and would essentially allow health plans to reimburse out-of-network providers the average in-network rate. We strongly opposed these bills. Luckily, after a lot of hard work and advocacy, we were able to successfully defeat the health plans’ bills.

Both of our bills successfully passed their respective Commerce and Labor committees. However, the legislation was referred to the House Appropriations and Senate Finance committees to determine whether there was a fiscal impact. There was some concern that our legislation will result in more physicians going “out of network,” which would raise premiums for the state employee health plan. Unfortunately, this argument won out in the House Appropriations Committee and Delegate Ware’s bill did not receive a hearing. SB1763, our bill in the Senate, passed out of Senate Finance and passed unanimously on the Senate floor. Unfortunately, after Crossover, SB1763 met the same fate as the House bill in the House Appropriations Committee.

There was language included in the House budget that instructs the Department of Human Resource Management to look at this issue and make recommendations for how to handle out-of-network coverage in the state employee health plan. This was not included in the Senate budget and we are working to ensure it is not in the final budget. Since the state employee health plan is run by Anthem, we believe it would not to be in Virginia patients’ best interest to only have them studying this issue. We continue to believe surprise/balance billing and out-of-network coverage should be addressed by all stakeholders and not solely decided by one group.

While the emergency services legislation was the most contentious, we were able to successfully pass legislation requiring patient notification for elective services. This will protect patients by notifying them when a service may be out-of-network, but without placing an administrative burden on the referring physician. HB2538, also carried by Delegate Ware, passed both the House and Senate unanimously. There were also multiple bills dealing with out-of-network ancillary services. Despite a lot of work by stakeholders, an agreement could not be reached at this time and the bills were referred back to the Health Insurance Reform Commission for further study.