On June 1, New Jersey Governor Phil Murphy signed into law the “Out-of-network Consumer Protection, Transparency, Cost Containment and Accountability Act,” making New Jersey the latest state to restrict “surprise” medical bills. A previous attempt to do so in the state was discussed here. New York, Connecticut, Florida, California, and a handful of other states have similar laws.The law requires that healthcare providers and facilities give non-emergency patients several types of information at the time their appointments are scheduled, including whether the provider or facility is in or out of network; the patient’s responsibility to pay any additional out-of-network fees; and, upon the patient’s request, an estimate of fees and a detailed breakdown of the services anticipated to be provided.
In addition, unless the patient “knowingly, voluntarily and specifically selected an out-of-network provider to provide services,” the out-of-pocket cost to the patient may not exceed what he or she would have been charged if the provider had been in-network. Any attempt by the provider or facility to collect more than the co-payment, deductible or co-insurance is prohibited.
Each healthcare facility will be required to provide on its website, among other things, a list of the facility’s standard charges for services; information on the facility’s physicians and the insurance plans in which they participate; and information on ancillary providers including anesthesiologists, pathologists, radiologists, assistant surgeons, and laboratory service providers.
The law also imposes disclosure obligations on state-regulated insurance plans, including licensed carriers, as well as self-funded plans that choose to opt in to its requirements. A carrier must provide information on its website including a description of the plan’s out-of-network benefits; expected out-of-pocket costs for common services; and information on whether a particular provider is in-network. The website must be updated within 20 days after a provider is added to or removed from the carrier’s network, or after a physician’s affiliation with a facility changes. The carrier must also notify the insured if the status of a facility or provider changes after the service to the insured has been authorized.
Potential penalties for non-compliance with the new law will be up to $25,000 for each occurrence ($1,000 per violation per day) for insurance carriers and healthcare facilities, and up to $2,500 per occurrence ($100 per violation per day) for other providers.
The law will go into effect on August 27, 90 days after the Governor’s signature. The New Jersey Department of Banking and Insurance and Department of Health are expected to issue implementing regulations and additional guidance before that date.