Lawmakers roll out bills on out-of-network billing, hospital prices, tobacco products, more

Have you ever gone to a hospital for a procedure, only to receive a surprisingly huge bill weeks later—perhaps tens of thousands of dollars larger than expected?

That can happen when you go to a hospital that is in your health care plan’s network, but your surgeon, anesthesiologist, radiologist or other provider is out of your network, without your knowledge.

Now, a bill working its way through the Indiana General Assembly aims to fix that.

House Bill 1004, introduced Monday by Rep. Ben Smaltz, R-Auburn, would prohibit hospitals and ambulatory surgical centers that are in a patient’s network from billing at a rate higher than specified in a patient’s health insurance, unless the facility notifies the patient in advance, provides a “good faith estimate of all the charges” and the patient signs a notification agreeing to pay the specified charges.

It would also prohibit out-of-network practitioners who provide services at in-network hospitals from charging any amount above the patient’s health plan, without prior consent.

“It’s all about how do we protect Hoosiers,” Rep. Smaltz said.

He said medical costs in Indiana are higher than the national average, and the state has a high bankruptcy rate, and many of the cases are associated with high medical bills, some of them surprise bills from out-of-network physicians.

Every day, thousands of Americans get a surprise bill in the mail from a health provider, asking for thousands of dollars for medical services that weren’t covered by the patient’s insurance. Often, that’s because a specialist who works at an in-network hospital is a contractor, not an employee, and outside the patient’s insurance network.

Across the United States, 16% of all in-network hospital admissions result in at least one out-of-network charge, according to the Peterson-Kaiser Health System Tracker. In Indiana, the number is 7%, less than half of the national average.

For emergency visits, where the patient often has less choice of hospitals, the figures are even higher. On average, 18% of emergency visits result in at least one out-of-network charge. In Indiana, the figure is 8%.

In some states, the figure is much higher. In Texas, for example, 38% of emergency visits result in an out-of-network charge, as do 27% of hospital admissions. Kaiser Family Foundation researchers said the reasons for such wide differences weren’t entirely clear but seem to be related to the breadth of hospital and doctor networks in each state, and the ways in which those networks are designed, the Associated Press reported.

Some states offer sweeping protections, including measures that hold patients harmless for surprise bills greater than the patient’s deductibles, co-pays or coinsurance. Others offer a dispute-resolution process.

But Indiana offers only the barest of protections. Under a law that took effect in 2018, physicians who refer patients to other providers must provide a notice to the patient stating that an out-of-network provider might be called upon to render services, and those services are not bound by the in-network payment provisions under the patient’s health plan. The notice also must tell patients they can contact their insurers to obtain a list of in-network providers.

Indianapolis-based Anthem Inc., which has the largest market share among health insurers in Indiana and is one of the largest health insurers nationally, said it supports the bill.

“It puts consumers first when it comes to addressing the issue of surprise medical billing,” Anthem spokesman Tony Felts said in an email. “HB 1004 would protect consumers and employers by establishing the in-network rate as the benchmark for reimbursement of disputed out-of-network services. This would reflect the actual market rate that providers agree to when joining an insurance carrier’s network. In addition, we continue to work with our in-network hospitals to ensure that all physicians who perform health care services within those hospitals are Anthem network providers.”

The Indiana Hospital Association said it is still reviewing the bill, but it favors not surprising patients with unexpected bills, and wants to hold them harmless if they receive a bill from an out-of-network physician who is working at an in-network hospital. In those cases, it wants to establish a fair method for hospitals and doctors to resolve the disputes with insurance company, as some other states have enacted.

“Hospitals absolutely agree with taking patients out of the middle in these instances where a lab or physician is not in the patient’s network even though the hospital is,” said Brian Tabor, president of the Indiana Hospital Association. “It’s essential that we provide this protection this session.”

Here is a quick look at some other health-related bills introduced by lawmakers in recent days for consideration in this year’s legislative session.

House Bill 1005 (Rep. Donna Schaibley): Requires not-for-profit hospitals to hold public meetings twice a year to explain pricing and outline what steps they are taking to make health care more affordable. Referred to the Committee on Public Health.

House Bill 1006 (Rep. Cindy Kirchhofer): Requires a person to be at least 21 years old to purchase tobacco products, e-cigarettes and e-liquids. Retailers who sell these products to underage customers could get their retail certificate suspended for three years, or even revoked if the retailer racks up four violations within three years. Referred to the Committee on Public Health.

House Bill 1042 (Rep. Steven Davisson): Requires pharmacy benefit managers to obtain a license issued by the Indiana Department of Insurance and sets forth requirements of the pharmacy benefit manager—the so-called “middlemen” who negotiate pharmacy benefits between insurers, pharmacies and pharmaceutical companies. Requires the Insurance Department to adopt rules on licensing, financial standards and reporting requirements for pharmacy benefits managers. Referred to the Committee on Public Health.

House Bill 1067 (Rep. Dennis Zent): Allows dental hygienists to administer topical dental anesthetics, other than nitrous oxide or similar analgesics, without supervision.  Referred to the Committee on Public Health.

Senate Bill 1 (Sen. Ed Charbonneau): Prohibits a person who is under 21 from buying or possessing cigarettes, tobacco products, e-cigarettes or e-liquids. Retailers that sell e-liquids to underaged customers will be penalized. Referred to the Committee on Health and Provider Services.

Senate Bill 15 (Sen. Ronald Grooms): Requires a pharmacy benefit manager that is not licensed as an administrator to be registered with the Indiana Board of Pharmacy, and specifies requirements for registration. Referred to the Committee on Health and Provider Services.

Senate Bill 19 (Sen. Ed Charbonneau): Allows the prescription of eyeglasses online and sets up conditions for prescribers to issue eyeglass prescriptions. Referred to the Committee on Health and Provider Services.

Senate Bill 21 (Sens. Linda Rogers, Ronald Grooms, Ed Charbonneau): Provides that a pharmacist has a duty to honor all prescriptions issued by a physician’s assistant licensed under the laws of another state. Referred to the Committee on Health and Provider Services.

Senate Bill 97 (Sens. Vaneta Becker and Ed Charbonneau): Prohibits a state employee health plan, accident plan or health maintenance organization from modifying an enrollee’s coverage of a drug during the plan year, with certain exceptions. Referred to the Committee on Health and Provider Services.