The latest in Sacramento on “surprise bill” legislation

by
  • Poage, Jeffrey, MD
| Aug 01, 2016

Consumer advocates and patients in California are justifiably concerned over “surprise bills,” and this has become a critically important advocacy effort for CSA as we are working on your behalf in Sacramento. AB 72 (Bonta) is a bill pending in this legislative session that seeks to address the issue of out-of-network surprise medical bills. We have been active non-stop in the effort to improve this version of the legislation, and to continue to oppose its predecessor, AB 533 (Bonta), that failed last session.

surpriseAB 72 attempts to take patients out of the middle of billing issues for out-of-network care, a goal we strongly support. AB 72 is better in many ways than AB 533, which is still eligible to be voted on this year. But unfortunately AB 72 still has significant flaws. As written, it would set out-of-network payments at a statutory default rate that would be very advantageous to insurers. They would have no motivation to negotiate fair contracts with physicians who are currently not within their networks. This would drive down contracting rates across the state, result in very narrow networks, and ultimately reduce access to care.

Unfortunately, consumers still see anesthesiology as a significant part of the problem, as the recent article in the Sacramento Bee illustrates. If AB 72 passes, insurers will have no incentive to negotiate with anesthesiology groups or any other physicians who have resisted signing unfair contracts. Instead, we are working with the California Medical Association (CMA) to change the definition of an in-network hospital. We believe no insurer should be able to call a hospital or surgery center an in-network facility unless it has contracts with anesthesiologists, radiologists, and any other specialists that a patient could reasonably expect to need.

The Legislature reconvenes from summer recess today, and AB 72 will be up for a vote on the Senate floor in the coming weeks. If passed, it must go back for an Assembly vote for concurrence before the August 31 end-of-session deadline.

We need CSA members ready to make their voices heard to our state legislature – delivering a clear opposition message to AB 72.

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We know a better solution is possible. We are in favor of the New York model, which is a fair approach, and creates a payment methodology designed to motivate insurance companies to come to the table to negotiate reasonable contracts with the doctors and specialists needed to provide patient care. In fact, Consumers Union hailed the New York model as a legislative victory that, “provides consumers with the strongest protections in the nation against surprise, out-of-network medical bills.”However, here in California, the insurance industry and consumer advocates have put the brakes on this approach, making it impossible to adopt this even-handed compromise.

CSA will continue to work hard over the next month in coordination with the CMA to seek amendments to AB 72 in order to improve elements of this legislation. Among other issues, we are working on the definition of “Average Contracted Rate” to prevent manipulation in these calculations. The bill must include stronger requirements on insurance companies to provide adequate networks and protect patient access to care. In its current form, AB 72 is the wrong approach to solving the “surprise bill” problem, and CSA will continue to oppose the bill.

CSA will keep you updated on ways to reach out to your legislators in next 30 days to defeat this bill, just as we successfully underscored the flaws in AB 533 and helped in the fight against its passage in the final moments of last year’s legislative session.  

We will keep you updated on this critical policy issue, and please be ready to contact your local legislators when the time comes!

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