Assembly passes controversial ‘out-of-network’ bill

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A health care bill intended to curb enormous “surprise” charges from out-of-network doctors has passed the Assembly.

Assembly Bill 2039 would require hospitals to disclose to patients which out-of-network providers will be charging them before the patient undergoes treatment or surgery. The bill also would allow for a state-regulated, binding arbitration process between patients and out-of-network providers to settle costs for an out-of-network bill.

The bill passed along party lines in a 48-21 carried by majority Democrats.

The issue of out-of-network transparency has long been the center of debate in New Jersey. Rules such as contained in the bill have bene urged by Horizon Blue Cross and Blue Shield of New Jersey and others. Groups representing specialist doctors, such as the New Jersey Society of Anesthesiologists, claim such regulations would give insurance companies an unfair advantage when negotiating the price for specialist services.

John Fanburg, a partner at law firm Brach Eichler, said in an interview arbitration could drive up health care costs.

“If a baseball-style arbitration process is introduced to decide what the payer should be paying, that puts the provider in a difficult position and, over time, lead a de facto fee schedule for out-of-network providers,” Fanburg said. “The market has already evolved to the point where the out-of-network benefits are capped for many insurance policies. Many payers have already gone to a percentage of Medicare to pay for the out-of-network charges.”

NJBIZ reporter Maureen Nevin Duffy contributed to this report