2018 -- S 2235

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LC003611

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2018

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A N   A C T

RELATING TO INSURANCE -- SURPRISE BILLS FOR MEDICAL SERVICES

     

     Introduced By: Senators Algiere, and Lombardi

     Date Introduced: February 01, 2018

     Referred To: Senate Health & Human Services

     It is enacted by the General Assembly as follows:

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     SECTION 1. Title 27 of the General Laws entitled "INSURANCE" is hereby amended

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by adding thereto the following chapter:

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CHAPTER 82

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SURPRISE BILLS FOR MEDICAL SERVICES

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     27-82-1. Definitions.

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     For the purposes of this chapter:

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     (1) "Emergency medical condition" means a medical condition manifesting itself by acute

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symptoms of sufficient severity, including severe pain, such that a prudent layperson with an

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average knowledge of health and medicine, acting reasonably, would have believed that the

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absence of immediate medical attention would result in serious impairment to bodily functions or

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serious dysfunction of a bodily organ or part, or would place the person's health or, with respect

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to a pregnant women, the health of the woman or her unborn child, in serious jeopardy.

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     (2) "Emergency services" means, with respect to an emergency medical condition:

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     (i) A medical screening examination as required under Section 1867 of the Social

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Security Act 42, U.S.C. § 1395dd, as amended from time to time, that is within the capability of a

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hospital emergency department, including ancillary services routinely available to such

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department to evaluate such condition; and

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     (ii) Such further medical examinations and treatment required under Section 1867 of the

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Social Security Act 42, U.S.C. § 1395dd, to stabilize an individual, that are within the capability

 

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of the hospital staff and facilities.

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     (3) "Health care plan" means an insurer licensed to write accident and health insurance

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pursuant to chapter 18 of title 27; a nonprofit hospital service corporation licensed to write

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insurance pursuant to chapter 19 of title 27; a nonprofit medical service corporation licensed to

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write insurance pursuant to chapter 20 of title 27; and a health maintenance organization licensed

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to write insurance pursuant to chapter 41 of title 27.

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     (4) "Health care provider" means an individual licensed to provide health care services,

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pursuant to the general laws.

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     (5) "Health carrier" means an insurance company, health care center, hospital service

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corporation, medical service corporation, fraternal benefit society or other entity that delivers,

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issues for delivery, renews, amends or continues a health care plan in this state.

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     (6) "Insured" means a patient covered under a health care plan's policy or contract.

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     (7) "Nonparticipating" means not having a contract with a health care plan to provide

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health care services to an insured.

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     (8) "Participating" means having a contract with a health care plan to provide health care

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services to an insured.

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     (9) "Patient" means a person who receives health care services, including emergency

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services, in this state.

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     (10)(i) "Surprise bill" means a bill for health care services, other than emergency

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services, received by an insured for services rendered by an out-of-network health care provider,

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where such services were rendered by such out-of-network provider at an in-network facility,

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during a service or procedure performed by an in-network provider or during a service or

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procedure previously approved or authorized by the health carrier and the insured did not

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knowingly elect to obtain such services from such out-of-network provider; and

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     (ii) "Surprise bill" does not include a bill for health care services received by an insured

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when an in-network health care provider was available to render such services and the insured

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knowingly elected to obtain such services from another health care provider who was out-of-

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network.

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     27-82-2. Applicability.

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     This chapter shall not apply to health care services, including emergency services, where

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physician fees are subject to schedules or other monetary limitations under any other law,

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including the workers' compensation law, and shall not preempt any such law.

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     27-82-3. Billing and reimbursement.

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     (a) No health carrier shall require prior authorization for rendering emergency services to

 

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an insured.

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     (b) No health carrier shall impose, for emergency services rendered to an insured by an

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out-of-network health care provider, a co-insurance, co-payment, deductible or other out-of-

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pocket expense that is greater than the co-insurance, co-payment, deductible or other out-of-

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pocket expense that would be imposed if such emergency services were rendered by an in-

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network health care provider.

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     (c) If emergency services were rendered to an insured by an out-of-network health care

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provider, such health care provider may bill the health carrier directly and the health carrier shall

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reimburse such health care provider the greatest of the following amounts:

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     (1) The amount the insured's health care plan would pay for such services if rendered by

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an in-network health care provider;

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     (2) The usual, customary and reasonable rate for such services; or

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     (3) The amount Medicare would reimburse for such services. "Usual, customary and

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reasonable rate" means the eightieth percentile of all charges for the particular health care service

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performed by a health care provider in the same or similar specialty and provided in the same

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geographical area, as reported in a benchmarking database maintained by a nonprofit organization

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specified by the commissioner. Such organization shall not be affiliated with any health carrier.

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Nothing in this subsection shall be construed to prohibit such health carrier and out-of-network

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health care provider from agreeing to a greater reimbursement amount.

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     (d) With respect to a surprise bill:

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     (1) An insured shall only be required to pay the applicable co-insurance, co-payment,

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deductible or other out-of-pocket expense that would be imposed for such health care services if

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such services were rendered by an in-network health care provider; and

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     (2) A health carrier shall reimburse the out-of-network health care provider or insured, as

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applicable, for health care services rendered at the in-network rate under the insured's health care

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plan as payment in full, unless such health carrier and health care provider agree otherwise.

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     (e) If health care services were rendered to an insured by an out-of-network health care

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provider and the health carrier failed to inform such insured of the network status of such health

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care provider, the health carrier shall not impose a co-insurance, co-payment, deductible or other

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out-of-pocket expense that is greater than the co-insurance, co-payment, deductible or other out-

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of-pocket expense that would be imposed if such services were rendered by an in-network health

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care provider.

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     27-82-4. Dispute resolution process established.

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     The health insurance commissioner ("commissioner") shall establish a dispute resolution

 

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process by which a dispute for a bill for emergency services or a surprise bill may be resolved.

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The commissioner shall have the power to grant and revoke certifications of independent dispute

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resolution entities to conduct the dispute resolution process. The commissioner shall promulgate

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rules and regulations establishing standards for the dispute resolution process, including a process

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for certifying and selecting independent dispute resolution entities. An independent dispute

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resolution entity shall use licensed physicians in active practice in the same or similar specialty as

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the physician providing the service that is subject to the dispute resolution process of this chapter.

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To the extent practicable, the physician shall be licensed in this state.

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     27-82-5. Criteria for determining a reasonable fee.

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     In determining the appropriate amount to pay for a health care service, an independent

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dispute resolution entity shall consider all relevant factors, including:

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     (1) Whether there is a gross disparity between the fee charged by the physician for

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services rendered as compared to:

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     (i) Fees paid to the involved physician for the same services rendered by the physician to

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other patients in health care plans in which the physician is not participating; and

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     (ii) In the case of a dispute involving a health care plan, fees paid by the health care plan

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to reimburse similarly qualified physicians for the same services in the same region who are not

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participating with the health care plan;

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     (2) The level of training, education and experience of the physician;

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     (3) The physician's usual charge for comparable services with regard to patients in health

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care plans in which the physician is not participating;

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     (4) The circumstances and complexity of the particular case, including time and place of

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the service;

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     (5) Individual patient characteristics; and

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     (6) The usual and customary cost of the service.

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     27-82-6. Dispute resolution for emergency services.

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     (a) Emergency services for an insured:

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     (1) When a health care plan receives a bill for emergency services from a

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nonparticipating physician, the health care plan shall pay an amount that it determines is

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reasonable for the emergency services rendered by the nonparticipating physician, except for the

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insured's co-payment, co-insurance or deductible, if any, and shall ensure that the insured shall

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incur no greater out-of-pocket costs for the emergency services than the insured would have

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incurred with a participating physician;

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     (2) A nonparticipating physician or a health care plan may submit a dispute regarding a

 

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fee or payment for emergency services for review to an independent dispute resolution entity

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established by the commissioner;

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     (3) The independent dispute resolution entity shall make a determination within thirty

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(30) days of receipt of the dispute for review;

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     (4) In determining a reasonable payment for the services rendered, the independent

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dispute resolution entity shall select either the health care plan's payment or the nonparticipating

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physician's fee. The independent dispute resolution entity shall determine which amount to select

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based upon the conditions and factors set forth in § 27-82-5. If the independent dispute resolution

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entity determines, based on the health care plan's payment and the nonparticipating physician's

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fee, that a settlement between the health care plan and nonparticipating physician is reasonably

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likely, or that both the health care plan's payment and the nonparticipating physician's fee

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represent unreasonable extremes, then the independent dispute resolution entity may direct both

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parties to attempt a good faith negotiation for settlement. The health care plan and

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nonparticipating physician may be granted up to ten (10) business days for this negotiation, which

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shall run concurrently with the thirty (30) day period for dispute resolution.

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     (b) Emergency services for a patient who is not an insured:

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     (1) A patient who is not an insured or the patient's physician may submit a dispute

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regarding a fee for emergency services for review to an independent dispute resolution entity

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upon approval of the commissioner;

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     (2) The independent dispute resolution entity shall determine a reasonable fee for the

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services based upon the same conditions and factors set forth in § 27-82-5;

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     (3) A patient that is not an insured shall not be required to pay the physician's fee in order

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to be eligible to submit the dispute for review to the independent dispute resolution entity.

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     (c) The determination of the independent dispute resolution entity shall be binding on the

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health care plan, physician and patient, and shall be admissible in any court proceeding between

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the health care plan, physician or patient, or in any administrative proceeding between this state

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and the physician.

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     27-82-7. Hold harmless and assignment of benefits for surprise bills for insureds.

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     When an insured assigns benefits for a surprise bill in writing to a nonparticipating

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physician that knows the insured is insured under a health care plan, the nonparticipating

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physician shall not bill the insured except for any applicable co-payment, co-insurance or

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deductible that would be owed if the insured utilized a participating physician.

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     27-82-8. Dispute resolution for surprise bills.

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     (a) Surprise bill received by an insured who assigns benefits.

 

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     (1) If an insured assigns benefits to a nonparticipating physician, the health care plan

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shall pay the nonparticipating physician in accordance with subsections (a)(2) and (a)(3) of this

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section.

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     (2) The nonparticipating physician may bill the health care plan for the health care

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services rendered, and the health care plan shall pay the nonparticipating physician the billed

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amount or attempt to negotiate reimbursement with the nonparticipating physician.

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     (3) If the health care plan's attempts to negotiate reimbursement for health care services

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provided by a nonparticipating physician does not result in a resolution of the payment dispute

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between the nonparticipating physician and the health care plan, the health care plan shall pay the

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nonparticipating physician an amount the health care plan determines is reasonable for the health

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care services rendered, except for the insured's co-payment, co-insurance or deductible.

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     (4) Either the health care plan or the nonparticipating physician may submit the dispute

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regarding the surprise bill for review to an independent dispute resolution entity; provided

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however, the health care plan may not submit the dispute unless it has complied with the

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requirements of subsections (a)(1) through (a)(3) of this section.

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     (5) The independent dispute resolution entity shall make a determination within thirty

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(30) days of receipt of the dispute for review.

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     (6) When determining a reasonable fee for the services rendered, the independent dispute

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resolution entity shall select either the health care plan's payment or the nonparticipating

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physician's fee. An independent dispute resolution entity shall determine which amount to select

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based upon the conditions and factors set forth in § 27-82-5. If an independent dispute resolution

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entity determines, based on the health care plan's payment and the nonparticipating physician's

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fee, that a settlement between the health care plan and nonparticipating physician is reasonably

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likely, or that both the health care plan's payment and the nonparticipating physician's fee

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represent unreasonable extremes, then the independent dispute resolution entity may direct both

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parties to attempt a good faith negotiation for settlement. The health care plan and

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nonparticipating physician may be granted up to ten (10) business days for this negotiation, which

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shall run concurrently with the thirty (30) day period for dispute resolution.

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     (b) A surprise bill received by an insured who does not assign benefits or by a patient

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who is not an insured.

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     (1) An insured who does not assign benefits in accordance with subsection (a) of this

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section or a patient who is not an insured and who receives a surprise bill may submit a dispute

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regarding the surprise bill for review to an independent dispute resolution entity.

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     (2) The independent dispute resolution entity shall determine a reasonable fee for the

 

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services rendered based upon the conditions and factors set forth in § 27-82-5.

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     (3) A patient or insured who does not assign benefits in accordance with subsection (a) of

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this section shall not be required to pay the physician's fee to be eligible to submit the dispute for

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review to the independent dispute entity.

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     (c) The determination of an independent dispute resolution entity shall be binding on the

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patient, physician and health care plan, and shall be admissible in any court proceeding between

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the patient or insured, physician or health care plan, or in any administrative proceeding between

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this state and the physician.

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     27-82-9. Payment for independent dispute resolution entity.

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     (a) For disputes involving an insured, when the independent dispute resolution entity

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determines the health care plan's payment is reasonable, payment for the dispute resolution

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process shall be the responsibility of the nonparticipating physician. When the independent

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dispute resolution entity determines the nonparticipating physician's fee is reasonable, payment

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for the dispute resolution process shall be the responsibility of the health care plan. When a good

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faith negotiation directed by the independent dispute resolution entity pursuant to § 27-82-6(a)(4)

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or § 27-82-8(a)(6) results in a settlement between the health care plan and nonparticipating

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physician, the health care plan and the nonparticipating physician shall evenly divide and share

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the prorated cost for dispute resolution.

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     (b) For disputes involving a patient that is not an insured, when the independent dispute

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resolution entity determines the physician's fee is reasonable, payment for the dispute resolution

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process shall be the responsibility of the patient unless payment for the dispute resolution process

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would pose a hardship to the patient. "Hardship" means a household income below two hundred

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fifty percent (250%) of the federal poverty level as determined by the United States Department

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of Health and Human Services. The commissioner shall promulgate rules and regulations to

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determine payment for the dispute resolution process in cases of hardship. When the independent

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dispute resolution entity determines the physician's fee is unreasonable, payment for the dispute

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resolution process shall be the responsibility of the physician.

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     SECTION 2. Section 6-13.1-1 of the General Laws in Chapter 6-13.1 entitled "Deceptive

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Trade Practices" is hereby amended to read as follows:

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     6-13.1-1. Definitions.

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     As used in this chapter:

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     (1) "Documentary material" means the original or a copy of any book, record, report,

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memorandum, paper, communication, tabulation, map, chart, photograph, mechanical

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transcription, or other tangible document or recording wherever situated.

 

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     (2) "Examination" of documentary material includes the inspection, study, or copying of

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any documentary material, and the taking of testimony under oath or acknowledgment in respect

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of any documentary material or copy of any documentary material.

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     (3) "Person" means natural persons, corporations, trusts, partnerships, incorporated or

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unincorporated associations, and any other legal entity.

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     (4) "Rebate" means the return of a payment or a partial payment that serves as a discount

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or reduction in price.

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     (5) "Trade" and "commerce" mean the advertising, offering for sale, sale, or distribution

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of any services and any property, tangible or intangible, real, personal, or mixed, and any other

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article, commodity, or thing of value wherever situate, and include any trade or commerce

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directly or indirectly affecting the people of this state.

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     (6) "Unfair methods of competition and unfair or deceptive acts or practices" means any

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one or more of the following:

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     (i) Passing off goods or services as those of another;

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     (ii) Causing likelihood of confusion or of misunderstanding as to the source, sponsorship,

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approval, or certification of goods or services;

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     (iii) Causing likelihood of confusion or of misunderstanding as to affiliation, connection,

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or association with, or certification by, another;

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     (iv) Using deceptive representations or designations of geographic origin in connection

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with goods or services;

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     (v) Representing that goods or services have sponsorship, approval, characteristics,

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ingredients, uses, benefits, or quantities that they do not have or that a person has a sponsorship,

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approval, status, affiliation, or connection that he or she does not have;

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     (vi) Representing that goods are original or new if they are deteriorated, altered,

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reconditioned, reclaimed, used, or secondhand; and if household goods have been repaired or

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reconditioned, without conspicuously noting the defect that necessitated the repair on the tag that

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contains the cost to the consumer of the goods;

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     (vii) Representing that goods or services are of a particular standard, quality, or grade, or

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that goods are of a particular style or model, if they are of another;

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     (viii) Disparaging the goods, services, or business of another by false or misleading

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representation of fact;

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     (ix) Advertising goods or services with intent not to sell them as advertised;

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     (x) Advertising goods or services with intent not to supply reasonably expectable public

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demand, unless the advertisement discloses a limitation of quantity;

 

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     (xi) Making false or misleading statements of fact concerning the reasons for, existence

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of, or amounts of price reductions;

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     (xii) Engaging in any other conduct that similarly creates a likelihood of confusion or of

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misunderstanding;

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     (xiii) Engaging in any act or practice that is unfair or deceptive to the consumer;

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     (xiv) Using any other methods, acts, or practices that mislead or deceive members of the

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public in a material respect;

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     (xv) Advertising any brand name goods for sale and then selling substituted brand names

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in their place;

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     (xvi) Failure to include the brand name and or manufacturer of goods in any

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advertisement of the goods for sale, and, if the goods are used or secondhand, failure to include

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the information in the advertisement;

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     (xvii) Advertising claims concerning safety, performance, and comparative price unless

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the advertiser, upon request by any person, the consumer council, or the attorney general, makes

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available documentation substantiating the validity of the claim;

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     (xviii) Representing that work has been performed on or parts replaced in goods when the

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work was not in fact performed or the parts not in fact replaced; or

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     (xix) Failing to separately state the amount charged for labor and the amount charged for

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services when requested by the purchaser as provided for in § 44-18-12(b)(3).

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     (xx) Advertising for sale at a retail establishment the availability of a manufacturer's

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rebate by displaying the net price of the advertised item (the price of the item after the rebate has

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been deducted from the item's price) in the advertisement, unless the amount of the

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manufacturer's rebate is provided to the consumer by the retailer at the time of the purchase of the

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advertised item. It shall be the retailer's burden to redeem the rebate offered to the consumer by

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the manufacturer.

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     (xxi) For any health care provider (as such term is defined in chapter 82 of title 27) to

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request payment from an insured (as such term is defined in chapter 82 of title 27), other than co-

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insurance, co-payment, deductible, or other out-of-pocket expense, for:

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     (A) A surprise bill (as such term is defined in chapter 82 of title 27); or

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     (B) Emergency services (as such term is defined in chapter 82 of title 27) covered under a

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health care plan and rendered by an out-of-network health care provider;

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     (xxii) For any health care provider (as such term is defined in chapter 82 of title 27) to

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report to a credit reporting agency an insured's (as such term is defined in chapter 82 of title 27)

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failure to pay a bill for:

 

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     (A) A surprise bill (as such term is defined in chapter 82 of title 27); or

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     (B) Emergency services (as such term is defined in chapter 82 of title 27) covered under a

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health care plan and rendered by an out-of-network health care provider, when the health carrier

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(as such term is defined in chapter 82 of title 27) has primary responsibility for payment of such

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services, fees or bills; or

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     (xxiii) For any health care provider (as such term is defined in chapter 82 of title 27) to

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otherwise willfully fail to comply with chapter 82 of title 27 with such frequency as to indicate a

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general business practice.

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     SECTION 3. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO INSURANCE -- SURPRISE BILLS FOR MEDICAL SERVICES

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     This act would provide for a dispute resolution process for emergency services and

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surprise bills for medical services performed by nonparticipating (out-of-network) health care

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providers.

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     This act would take effect upon passage.

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