Read this article as it originally appeared in The Press of Atlantic City
For New Jersey residents who have ever been burdened with "surprise" out-of-network medical bills, a new law signed by Gov. Phil Murphy Friday is meant to better protect patients in the future.
Murphy signed the Out-of-Network Consumer Protection, Transparency, Cost Containment and Accountability Act after more than a decade of discussions between health care providers, insurers, business leaders, advocacy groups and legislators on how to limit out-of-network costs to residents.
Bill sponsors said about 168,000 New Jerseyans get out-of-network bills each year. New Rutgers University Center for State Health Policy poll results also estimated more than 400,000 residents each year get large medical bills from both in- and out-of-network charges.
"No one likes to be blindsided. But that's what's been happening to residents who did not know they were getting out-of-network medical care until they received a bill in the mail," Assembly Speaker Craig Coughlin said in a statement. "Residents should have the final say over what health care services make the most sense for them financially."
Surprise medical bills, or unexpected costs, can stem from any procedure, ER visit, doctor’s appointment or other billable treatment. Patients can find themselves in the middle of price negotiations between providers and insurers, or lack access to information on the costs for certain medical services.
Transparency and disclosure bill policies are intended to better protect patients from getting out-of-network bills by requiring health care facilities to tell patients about their network statuses, including the facility as a whole and any separate services, before a patient gets non-emergency care.
New Jersey health providers also must give patients an estimate of fees upon request. Both providers and insurers have to notify consumers and patients of any network or coverage changes, and insurers must have a phone hotline for questions.
For out-of-network billing, the law restricts the extra amount a health care provider may charge based on a person's deductible, copay or coinsurance amount that would be applied for in-network services.
An arbitrator will be used in reimbursement and billing disputes when health insurers and health providers cannot agree on costs. The law will go into effect in September.
Officials from the New Jersey Business and Industry Association said the legislation was "a solution that is fair to health care providers and consumers alike" for its reasonable compensation to facility-based providers and protection to consumers, but some advocacy groups were against the new law.
"The New Jersey Doctor-Patient Alliance is extremely disappointed that the governor ignored the voices of patients and doctors and instead sided with big insurance carriers," alliance President Dr. Peter DeNoble said in a statement. "We had hoped he would have conditionally vetoed this legislation to make it fairer to the patients and small business owners that will be hurt by this law."
According to the Rutgers health poll, one in seven New Jersey adults reported that family living with them received a large, surprise medical bill last year.
The rate was even higher — one in five — among lower-income families, minority populations, people who reported being in poor health and those with less than a high school education.
"Our data show that the general public feels a need to address this problem," said Joel Cantor, director of the health policy center. "This legislation addresses the biggest pieces of the problem in terms of out-of-network bills and the share of bills."