The Democratic sponsors of the “Out-of-Network Consumer Protection, Transparency, Cost Containment and Accountability Act” are trying again this session to work out a compromise that has enough teeth to shield patients without completely alienating hospitals, physicians and insurers, all powerful interest groups. Lawmakers have been working on the issue for more than eight years, and a similar measure died in the state Senate last year.
“The health-care system is in crisis. We have people who are brutalized by it every single day,” said Assemblyman Jack M. Ciattarelli, a Somerville Republican, as he cast his vote to release the newly amended legislation from the committee that oversees insurance. While noting that he still has concerns about parts of the bill, he said, “We can’t do nothing,”
The latest version of the legislation would require hospitals to assure that every doctor who cares for patients in the hospital’s emergency department bill the patient no more than the patient’s deductible, copayment or coinsurance amount, even if the doctor does not participate in the patient’s insurance network. And hospital-based physicians, such as anesthesiologists, radiologists, pathologists and emergency physicians who contract with the hospital would have to accept the same insurance plans that the hospital did.
Hospitals and physicians expressed their strenuous opposition to the measure at a 3½-hour hearing, leading the committee chairman, Assemblyman Craig Coughlin, a Wood-bridge Democrat, to vent his frustration.
Dr. John Azzariti, part of the Bergen Anesthesia Group, which holds an exclusive anesthesiology contract with The Valley Hospital in Ridgewood, blamed the problem on insurance companies. He also is president of the New Jersey Society of Anesthesiologists.
“We don’t like to send out balance bills to our patients,” he said. “As a matter of fact, if physicians were offered fair rates by insurance companies, I don’t think we would be here today. … It’s our intention to maintain leverage so we can stay around in New Jersey and take care of these patients.”
Recent examples reported in the newspaper, such as the Rutgers student who was sued by Bergen Anesthesia for $2,200 after his insurer paid $726 for anesthesia during an emergency appendectomy, are not common, he said. Those situations arise when insurers pay far below the rates typically negotiated for in-network care, he said.
A Wayne neurosurgeon, Dr. Raj W. Raab, decried what he termed misleading marketing by major insurance companies that offer out-of-network coverage. It is impossible for patients to learn in advance what their insurer will pay when the patient is billed by an out-of-network doctor, said Raab, who is president of the New Jersey Neurosurgical Society.
When the patient learns — often from him — that the insurer’s payment is based on a percentage of Medicare rates, and not the doctor’s actual charges, “it becomes clear to them that they have been swindled,” he said. The insurers “charge very high fees for a junk insurance product.”
The measure would rely on an arbitrator to settle disputes between insurers and hospitals or physicians over reimbursement for emergency care, and cap the amount the arbitrator could choose at twice the rate paid by Medicare.
Hospitals and doctors object to that limit, saying it would give them no leverage with insurance companies, who could lowball their rates, knowing the maximum payout. In many instances, the Medicare reimbursement is below cost, they said.
Coughlin asked the physician representatives testifying, “Can you give me the five or 10 words you actually agree with? Candidly, I don’t know if we’re ever going to get to anything you can actually agree to.”
Speaking on behalf of the measure was Maura Collinsgru, health advocate for New Jersey Citizen Action. She was joined by several union representatives.
“Any one of us at any time is at risk of being a victim of one of these bills,” she said. “Out-of-network surprise bills are driving up the cost of insurance here in New Jersey and the cost of our care. They are unfairly penalizing New Jerseyans who do all the right things,” when they choose an in-network hospital for their care.
The measure was co-sponsored by Democratic assemblymen Gary Schaer of Passaic and Troy Singleton of Mount Laurel, and assemblywomen Pamela Lampitt of Voorhees and Grace Spencer of Newark.
A second measure, to establish a healthcare price index as an objective, reliable and comprehensive source of information, also passed the committee.