NEW RESOURCES: Balance Billing Protection Act Implementation

January 7, 2020


To:                  Chief Financial Officers, Legal Counsel, Government Affairs Staff and WSHA Out-of-Network Billing Taskforce

Please forward this bulletin to those responsible for patient billing, carrier/health plan contracting, and those responsible for updating the hospital’s website.

From:               Andrew Busz, Policy Director, Finance |,  (206) 216-2533

Subject:           NEW RESOURCES: Balance Billing Protection Act Implementation

This bulletin provides updated information regarding the Washington State Balance Billing Protection Act, now contained in RCW 48.49. This new law is effective January 1, 2020. The new law includes balance billing prohibitions for certain services, a dispute resolution process for payments for out-of-network services, and various communication and transparency requirements, including the need to post information for consumers on hospital and provider websites. WSHA worked hard during the legislative and rulemaking process to ensure a fair dispute resolution process for facilities and providers and minimize administrative burden.

This updated bulletin includes links and resources that became available recently, including:

The changes apply to all hospitals and providers that provide services in a hospital or facility setting, including providers of emergency services, surgery, radiology, pathology, anesthesiology, and hospitalists.

Recommendation and Overview
This bulletin reflects a summary of key provisions of the bill and links to information and resources, as well as some operational links and considerations.  We recommend appropriate staff at hospitals and physician groups, in conjunction with their legal counsel, familiarize themselves with the information and links within this bulletin, including the References and Resources section.

1.         Enrollees subject to Balance Billing Protection Act (BBPA)
Under RCW 48.49 the payment requirements, dispute resolution provisions, and balance billing prohibitions apply to specific services provided to:

  • Enrollees of fully-insured OIC-regulated carriers (also commonly known as health plans)
  • Enrollees of the state Public Employee Benefits Board (PEBB) and School Employees Benefits Board (SEBB)
  • Enrollees of ERISA self-funded groups where the group has voluntarily elected to the provisions of the law by registering with the Office of the Insurance Commissioner. Electing groups must register on an annual basis.  A list of current self-funded groups that have elected to the BBPA is here.

The Balanced Billing Protection Act (BBPA) does not apply to ERISA groups that have not registered with OIC to participate in the provisions of the bill.  The BBPA does not apply to Medicare or Medicaid, which have other protections for enrollees.

2.         Identification of included enrollees
WSHA worked hard to ensure the law includes a robust mechanism for hospitals and provider groups to determine whether a patient’s coverage is subject to the provisions of the law. Access to this information is critical to avoid unintentional balance billing and to identify services that are subject to the dispute resolution process.

The final rule requires carriers to make the information available via a standard message in the X12 271 eligibility and benefits transaction. Carriers must comply with this provision as of January 1, 2020. In addition, carriers must indicate whether services are subject to the BBPA on patient explanation of benefits as of July 2020.

For enrollees that are subject to the BBPA, the transaction will display the following text:

“Services provided to this patient are subject to the Balance Billing Protection Act. Please see RCW 48.49.020 for details.”

WSHA recommends hospitals and providers query this information to confirm whether the patient is covered by the BBPA when scheduling patients for non-emergency services and prior to any balance billing activity.

3.         Services subject to the BBPA
The balance billing prohibitions and payment provisions apply to:

  • A. Out-of-network emergency services (facility billing and professional charges billing).In WAC 284-43B-010 ,  “emergency services” is defined as: “a medical screening examination, as required under section 1867 of the Social Security Act (42 U.S.C. 1395dd), that is within the capability of the emergency department of a hospital, including ancillary services routinely available to the emergency department to evaluate that emergency medical condition, and further medical examination and treatment, to the extent they are within the capabilities of the staff and facilities available at the hospital, as are required under section 1867 of the Social Security Act (42 U.S.C. 1395dd) to stabilize the patient. Stabilize, with respect to an emergency medical condition, has the meaning given in section 1867 (e) (3) of the Social Security Act (42 U.S.C. 1395dd(e) (3)).”

    B.  Out-of-network surgery, radiology, pathology, anesthesiology, laboratory and

    hospitalist services when provided at an in-network facility.
    The BBPA applies to cases where the facility is contracted with the carrier, but providers of surgery, radiology, pathology, anesthesiology, laboratory and hospitalist services are not contracted with the health plan. The BBPA does not apply to cases where both the facility and provider are not contracted with the carrier, other than emergency services.The law was designed to target situations where a patient has little or no ability to anticipate and choose in advance the specific providers of care to avoid unexpected out-of-network charges.

    C.  Out of Network Services at Border Hospitals

    The bill requires carriers to hold the patient harmless for costs in excess of normal cost sharing when the patient receives out-of-network emergency services at a hospital in a border state. This provision would be nullified in the event of federal rule change or interstate agreement prohibiting balance billing for these services.

  1. Payment and dispute resolution
    The BBPA applies a “commercially reasonable” standard for payments for the services and patient categories subject to the bill.  The BBPA adopted a commercially reasonable definition standard rather than a default payment rate. For services and patient categories subject to the bill, the patient is held harmless and the dispute resolution process is between the carrier and the provider or facility. The bill includes a 30-day informal dispute resolution process between the carrier and the facility or provider to negotiate mutually acceptable payment. If informal dispute resolution does not resolve the dispute, either party can request arbitration.  Details of arbitration process:
    • Allows bundling of claims that occur within a period of two months of one another, involve identical carrier and provider or facility parties; and involve the same or related current procedural terminology codes relevant to a particular procedure. WSHA advocated for this provision to ensure provision arbitration is financially feasible for high volume services that may not be large enough on an individual claim basis.
    • Baseball-style arbitration. The carrier or electing self-funded group and the hospital or provider will each submit a best offer to the arbitrator. The arbitrator will select only one of the offers that he/she determines to best meet the commercially reasonable rate.
    • The arbitrator can refer to the state’s all payer claims data base (APCD) information to assist in determination of the commercially reasonable rate for the service.  APCD data is drawn from commercial payments for similar services in the same geographic area and includes:
      • Median in-network rate
      • Median out-of-network rate
      • Median billed charge
      • Because of data limitations in the APCD, the initial data set does not include information for anesthesiology services or for emergency department hospital facility charges. These services will be added to the dataset at a later date.
    • Expenses incurred in the course of arbitration, including the arbitrator’s expenses and fees, but not including attorneys’ fees, must be divided equally among the parties to the arbitration.

WSHA recommends hospitals view the dataset drawn from the state’s APCD in determining whether to pursue arbitration and in determining their final offer for arbitration carefully consider the potential costs and benefits of arbitration and develop appropriate policies regarding when to pursue arbitration. Other than very large claims or cases where a volume of smaller claims can be bundled, it may be more cost-effective to resolve cases through the informal dispute resolution process.

More information regarding the arbitration process is here.

5.         Network adequacy
The BBPA has provisions to encourage greater network adequacy and contracting. Not less than thirty days prior to executing a contract with a carrier, a hospital or ambulatory surgical facility must provide the carrier with a list of the nonemployed providers or provider groups contracted to provide surgical or ancillary services at the hospital or ambulatory surgical facility. A hospital or ambulatory surgical facility also must provide an updated list of these providers within fourteen calendar days of a request by a carrier.

The Insurance Commissioner must consider whether the carrier’s proposed provider network or in-force provider network includes a sufficient number of contracted providers of emergency and surgical or ancillary services at or for the carrier’s contracted in network hospitals or ambulatory surgical facilities to reasonably ensure enrollees have in-network access to covered benefits delivered at that facility.

6.         Communication and transparency
Hospitals and providers must post on their website a listing of carrier networks which they are in-network.  Carrier provider contracts shall be required to identify the network or networks to which the contract applies. Hospitals and providers must post the networks they are contracted with as of January 1, 2020, as well as new contracts signed after that date.

WSHA recommends hospitals ensure they have processes to update their website to reflect contract changes and to inform carriers of changes to the nonemployed groups providing services at the facility.

Hospital and providers must post on their websites the standard notice of consumer rights in a prominent and relevant location near the listing of contracted carrier provider networks.

Hospitals and providers must also provide a copy of the notice with confirmations of scheduled non-emergency services that involve enrollees and services subject to the BBPA, and upon request by a patient. This must be provided regardless of the facility’s contracted status with the carrier, as the purpose is to provide communication of patient rights in the event the patient receives services from an out of network provider related to a non-emergency service scheduled at a contracted facility. Facilities and providers are not required to obtain a response from the enrollee before provision of the scheduled services.

WSHA recommends hospitals and providers query and confirm whether the patient’s coverage is subject to the BBPA via the X12 271 transaction when scheduling patients for non-emergency services to determine if they need to provide the standard notice and prior to any balance billing activity.

  • Hospitals must also provide carriers with the names of independent groups that provide ancillary services at the hospitals at the time the hospital contracts with a carrier or when otherwise requested by a carrier.

7.         Enforcement
OIC may report to the Department of Health hospitals believed to engage in “a pattern of violations” of the sections of the bill including balance billing for investigation and enforcement.  The BBPA includes fines up to $1000 per violation. Information regarding OICs interpretation and approach regarding this provision is in the final rule’s concise explanatory statement. OIC indicated its goal is to resolve potential violations through these opportunities to cure rather than through penalties.

WSHA’s 2019 new law implementation guide
Please visit WSHA’s 2019 implementation guide online, where you will find a list of the high priority laws that WSHA is preparing resources and information on to help members implement the new laws, as well as links to resources such as this bulletin. In addition, you will find the Government Affairs team’s schedule for release of upcoming resources on other laws and additional resources for implementation.

References and Resources

BBPA Law, Rules, and Concise Explanatory Statement
Final Rules
Concise Explanatory Statement

WSHA Resources
Link to Previous WSHA Bulletin
WSHA June Webinar Slides
OIC Resources

Main OIC Page/Menu
Consumer Page
Obligations for Medical Providers
Link to OIC Provider Webinar
Link to Consumer Notice of Surprise Billing Rights
Link to X12 271 Standard information


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