CSA News

Advocacy Update: AB 72 “Fix” Heads to the Senate

Jun 11, 2020
CSA and your advocacy team of lobbyists and LPAD leadership have been hard at work fixing some of the inequities around the Independent Dispute Resolution Process (IDRP) created by AB 72 (Bonta).

CSA-Sponsored AB 2157 (Wood) Passes Out of the Assembly 

CSA and your advocacy team of lobbyists and LPAD leadership have been hard at work fixing some of the inequities around the Independent Dispute Resolution Process (IDRP) created by AB 72 (Bonta).

Our CSA-sponsored AB 2157, authored by the Assembly Health Committee Chair Jim Wood (D-Santa Rosa), codifies recent sub-regulatory guidance issued by the California Department of Managed Health Care (DMHC) and provides further balance between physicians and health plans and/or insurers over billing and payment disputes for out-of-network health care services provided in an in-network facility. That new guidance issued by the DMHC is a direct result of persistent CSA efforts petitioning the department to provide more clarity in terms of what information needs to be considered in these payment disputes.

Due to the COVID-19 crisis and the truncated legislative session, the Legislature has significantly pared down the number of bills they will be considering this year. Of the approximately 1,500 bills introduced in the Assembly, AB 2157 is one of only a couple hundred of those measures that are still moving forward this year. In fact, on Tuesday of this week our legislation passed out of the Assembly with bipartisan and unanimous support. AB 2157 now proceeds to the Senate where it will be considered by the Sente Health Committee sometime between July 13th and July 31st.

Specifically, AB 2157 provides the following:

1.) Ensures that information submitted through the IDRP must be kept confidential from either disputing party.

2.) That the independent arbiter conducts a “de novo” review of the claim dispute based solely on the information and documents timely submitted into evidence by the parties. 

3.) That the independent arbiter assigns reviewers to each case based on their relevant education, background, and medical claims payment and clinical experience.

As physicians keeping patients safe while undergoing complex surgeries and other procedures that require high levels of sedation, we believe that no patient should ever worry about receiving a “surprise bill” from their anesthesiologist. As most of you recall, in 2016 California passed AB 72 (Bonta) (Chapter 492), which rightfully removes patients from the middle of these contact and billing disputes between health plans and/or insurers and physician should they receive services from an out-of-network provider in an in-network facility.

AB 72 was also intended to encourage physicians, health plans and/or insurers to negotiate fair and reasonable contracts in order to maintain an adequate network of physician services and ensure access. However, as it relates to anesthesiology services, the pendulum has swung too far in favor of health plans, insurers and their delegated authorities. In fact, a growing number of anesthesiology groups have indicated that since AB 72 was enacted, health plans, insurers and their delegated authorities have been demanding significant reductions in their reimbursement rates or they will simply terminate the contract, which has nearly led to situations where there are no anesthesiology services available at in-network facilities. This behavior is not only completely counter to the intent of AB 72 but has the potential to severely impact, diminish or entirely eliminate patient access to anesthesiology services at contracted in-network facilities.

It is important to note that AB 2157 does not increase reimbursement rates for physicians, including anesthesiologists. Rather, this bill is a smart approach to ensuring physicians, including anesthesiology medical groups, are not artificially disadvantaged when seeking adjudication over rates paid for out-of-network health care services.  

AB 2157 helps strike a fair balance between keeping patients out of the middle of these contract disputes while at the same time maintaining the integrity of the IDRP established by AB 72.

Stay tuned for further updates and a CSA grassroots call-to-action in mid-July prior to the bill being heard in the Senate Health Committee.

Antonio Hernandez Conte, MD, MBA, FASA is Chair of the Legislative and Practice Affairs Division.