Office of the Insurance Commissioner Issues Another Draft of Balance Billing Legislation

January 11, 2017

The Washington Office of the Insurance Commissioner (OIC) recently issued a new draft of what we anticipate will become a bill to restrict balance billing.  It applies to cases where services are provided at an in-network facility by a provider who is not contracted with the patient’s health plan. WSHA supports protections for patients in cases of emergency services where the patient has no control regarding the provision of professional services.  This latest draft, however, raises serious concerns as it extends far beyond emergency services. It includes surgeons and all other providers at an in-network facility, whether the service was pre-scheduled or not and whether the service was part of a covered benefit or not. In addition, it seems to make the hospital responsible by stating that the balance billing situation arises when no in-network provider was available for that person. This is problematic as independent physicians and physician groups that provide professional services at hospitals are contracted directly by the health plans rather than through the hospital, and there is no requirement that plans contract with physicians such as emergency physicians and radiology or anesthesiology groups that provide care at in-network hospitals.

The bill has onerous reporting and communication requirements for hospitals. It requires hospitals to provide in-network options for all services at the facility or provide a posting on its website that includes the names, mailing addresses and telephone numbers of all the health care providers with whom the facility contracts to provide services in the facility. We are concerned this may extend beyond hospital-based specialties such as emergency docs, radiologists, anesthesiologists and pathologists to include surgeons, other community physicians, and other providers who may provide care at a hospital.

We also think the bill, if enacted, would impact payment provisions in the overall market. If a person has been treated by an out-of-network provider at an in-network facility, this draft sets payment rates at the greater of 125 percent of Medicare or the average contracted rate. This could reduce the incentive for plans to contract with the providers at in-network hospitals, since plans with this rate would generally pay no more, and sometimes less than if they had contracted with the providers. The proposed bill does not require health plans to contract with an adequate network of the providers at the contracted hospitals and may actually increase the number of out-of-network services.

WSHA will be focused on this issue during legislative session. If you have input for us, please contact Andrew Busz at (206) 216-2533 or at


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