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Latest out-of-network protection bill clears Senate panel but still faces opposition

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The long-awaited legislation protecting patients from health professionals and hospitals that choose to be out of network, and charge rates that insurers refuse to pay, may soon be law.

In recent months, state Sen. Joseph Vitale (D-Woodbridge) has said the bill is closer now than ever before.

And Monday, the bill to protect patients passed the Senate Budget and Appropriations Committee alongside a transparency bill sponsored by Sen. Paul Sarlo (D-Wood-Ridge).

Neither bill is popular with experts for reasons that have stopped similar bills’ progress in Trenton in the past.

The protection bill’s method to resolve a surprise bill from a doctor is “baseball-style arbitration” that uses, among other guidelines, Medicare.

The Medical Society of New Jersey and New Jersey Hospital Association said at the hearing Monday that this is still the sticking point.

“Though physicians have every right to be out of network with insurance companies who underpay them, legislators are right to ask for patient protection in in-network settings. But did you know that New Jersey already provides that protection?” said MSNJ’s Mishael Azam. “Health insurance companies complain that a small handful of physicians and hospitals charge what they consider outlier high rates.”

In her testimony, she highlighted a law that ensures a specialist, including anesthesiologists and radiologists, whether in or out of network, cannot charge a person who is insured, and has complied with all required preauthorization, more than the copayment, deductible and/or coinsurance applicable to the network services.

A similar law exists to cover patients who end up in emergency situations.

Azam has also previously testified that the state already has an arbitration process in place for unresolved balance bills.

The New Jersey Hospital Association’s Neil Eicher said an unintended consequence of the bill would be insurers being incentivized to decrease their reimbursement rates, since the arbitration process includes as a baseline Medicare — which is a notoriously low payer.

The bills heard Monday in Trenton only cover 30 percent of the state’s insured, since a majority of those insured in the state are under self-funded plans, which are regulated at the federal level.

The patient protection bill allows for those plans to opt-in, which lobbyists said was illegal according to a U.S. Supreme Court ruling.

The transparency bill has some more support from health professionals and lobbyists, but others worry that, if it passes without the out-of-network bill, it does nothing to help the situation.

The New Jersey Association of Health Plans supported the patient protection bill but opposed Sarlo’s bill.

Horizon Blue Cross Blue Shield of New Jersey has previously said it was in favor of the protection bill and was lobbying for its passage in exchange for sharing a small portion of its reserves in February.

The bill needs to clear the full Senate on Thursday and the full Assembly in order to get to the final stage.

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