Featuring: Hannah Maroney + Cara Tucker | Legal Counsel
At Ensemble Health Partners, we track regulatory updates in the healthcare industry to keep our operators informed and ensure our partners have the information they need to stay ahead of the changing legislation.
It’s still early in 2024, but state legislatures have already been busy this year. Here are some topics and bills that our experts have been watching closely.
Patient Medical Debt Collection
- Connecticut – Raised SB 395 would prohibit health care providers from reporting medical debt to credit rating agencies. It would also require providers to include in any contracts with debt collection entities a provision which would prohibit those entities from credit reporting. This legislation has so far passed the Senate. If it becomes law, it would be effective July 1, 2024.
- Florida – HB 7089 establishes a three-year statute of limitations to collect medical debt, and exempts medical debt from legal process including attachment, garnishment, or legal process in an action on medical debt. This bill has passed the legislature but has not yet been presented to Governor Ron DeSantis as of the conclusion of the 2024 Regular Session. Once presented, Governor DeSantis will have 15 days to take action.
- Maine – SP 908 prohibits health care providers from charging any interest on debt or fees in connection with collection of medical debt. It also prohibits debt collectors from pursuing litigation to compel payment of medical debt without providing proof that the consumer was sent a certain written notice, given at least 30 days to respond, and when the consumer’s household income is not more than 300% of the Federal poverty guidelines. This bill was recently approved by the governor and will become effective 90 days after adjournment of the legislative session.
- New Jersey – A3760 or the “Medical Debt Homestead Protection Act” prohibits forced home sales in cases of bankruptcy resulting from medical debt. S2806/A3861 or the “Louisa Carman Medical Debt Relief Act” prohibits medical debt collectors from reporting medical debt to consumer reporting agencies as of the effective date (not provided), as well as prohibits consumer reporting agencies from reporting medical debt less than $500 regardless of when the debt was incurred. A3513 caps the medical debt interest rate as the lessor of (i) “the annual rate equal to the weekly average one-year constant maturity Treasury yield, as published by the Board of Governors of the Federal Reserve System, for the calendar week preceding the date when the consumer was first provided with a bill” or (ii) 3%. All bills are pending committee review.
- South Carolina – HB 4571 would prohibit consumer credit reporting agencies from using in its consumer credit report any information concerning medical debt. This bill has been with the House Committee on Labor, Commerce and Industry since January.
- Tennessee – HB 1957 would prohibit consumer reporting agencies from including on a consumer report a record of medical debt. It would also require providers and facilities to ensure that any amount of outstanding patient date that equals the amount of public funds accepted is designated as satisfied and that patient is notified of such satisfaction of their debt. Lastly, it would prohibit providers and facilities from seeking judgment or taking other legal action to collect medical debt. This bill recently failed in the Senate Commerce and Labor Committee.
- Virginia – Virginia passed two new laws relating to medical debt during its session. HB 1370 prohibits facilities, providers, emergency medical services agencies, and debt collection entities from reporting any portion of a medical debt to a consumer reporting agency. HB 34 establishes a three-year statute of limitations from the final invoice due date to collect medical debt unless there is a contract for a payment plan that allows for a long period of time for collection. Where there is a breach of a payment plan, an action is barred if not started within three years from the date of breach. Both laws become effective July 1, 2024.
- Wisconsin – AB 786 would have prohibited health care providers, billing administrators, and debt collector acting on behalf of the provider from reporting a medical debt to a consumer reporting agency unless 1) the health care provider provided a written statement to the patient describing the unpaid amount and including the name and address of the health care provider that provided the services, 2) six months have passed since the due date listed on that statement, and 3) the patient does not dispute the charges. This bill recently failed to pass the Senate.
Downcoding
- Connecticut – Raised SB 405 would require payers that contract with a health care provider on or after July 1, 2025, to include in their contract a provision that prohibits the payer from downcoding any claim submitted by the health care provider. This bill is with the Senate, which held a Public Hearing about it in March.
- Florida – Although these bills died in committee during Florida’s legislative session, HB 1475/SB 1574 would have prohibited insurers from downcoding (unless otherwise permitted in the participation agreement) if the service was ordered by a provider in-network with the applicable health plan. If permitted by the participation agreement, the payment adjudicator would have needed to meet additional requirements.
- New Jersey – As introduced, Bill S594 and Bill A1036 would prohibit payers from downcoding in a manner that would prevent a health care provider from submitting a claim for the services performed and collecting reimbursement from the payer for that service. Both bills are pending committee review.
Prior Authorization
- Arizona – HB 2726 would require that, in the event a patient changes insurance, if the prior insurer approved a prior authorization for a covered service, the new health care insurer must also honor the prior authorization for the first 90 days of the member’s health insurance coverage. Also imposes requirements for publication and notification of requirements and changes to the same. Further, makes prior authorization valid for at least six months from the date the health care insurer receives the prior authorization or the length of the treatment and remains in effect regardless of any changes in the prescription dosage. This bill has been assigned to the HHS and Rules Committees and is pending review.
- Connecticut – Raised HB 5460 would prohibit insurers from (1) requiring prior authorizations after any transport when medically necessary by ambulance to a hospital, and (2) denying payment to ambulance providers on the basis that the enrollee failed to obtain a prior authorization. This bill is currently with the House Joint Committee on Insurance and Real Estate, which held a hearing about it in March.
- Florida – Although these bills also died in committee during Florida’s legislative session, HB 1475/SB 1574 would have required insurers to establish an electronic prior authorization process for accepting prior authorization requests.
- Kansas – HB 2713 would impose certain requirements and limitations on the use of prior authorization for healthcare services. This bill has been referred to Committee on Interstate Cooperation and is pending review.
- Kentucky – HB 317 would have established a prior authorization exemption program including, for example, a requirement that a health care provider be exempted when they have a 90% approval history during a specific timeframe. This proposed “gold card” program was supported by both the Kentucky Hospital Association and the Kentucky Medical Association, but Beckers recently reported that this bill failed.
- Maine – HP 485/LD 796 requires health plan carriers to establish and maintain a grievance procedure for resolution of prior authorization denials where such procedures must include notice to the enrollee’s provider of a prior authorization denial. The law further requires that if a covered medically necessary service cannot be delivered on the approved date of an approved prior authorization request, a carrier cannot deny the claim if the service is provided within 14 days before or after the approved date. If non-emergency services within scope of a patient’s coverage are provided without a required prior authorization approval, the carrier cannot deny the claim pending medical necessity review and may not impose a penalty on the provider for failing to obtain a prior authorization greater than 15% of the contractually allowed amount for the services. This new law also establishes other requirements and limitations around prior authorization processes and imposes certain new reporting requirements on health carriers about their prior authorization requirements. This bill became law without the governor’s signature on May 1, 2024. Bills in Maine become effective 90 days after the end of the legislative session in which it was passed; here, that will be mid-July.
- Missouri – SB 983 provides that a health carrier or utilization review entity shall not require health care providers to obtain prior authorization for health care services, except under certain circumstances. Similarly, HB 1976 adds additional requirements for prior authorization, including a 6 month evaluation period, notifications, determination parameters, and online portal access. Both bills are pending committee review and advancement.
- New Hampshire – SB 561 seeks to establish parameters around the use of prior authorization while also standardizing and streamlining those processes. Among the different requirements, the law would require a prior authorization to be valid for 60 business days from the date of issuance. It would also require, with specific exceptions, that health carriers pay contracted health care providers for a health care service which was provided according to a prior authorization determination. This bill has passed the Senate, and the House Commerce and Consumer Affairs Committee recently held a Public Hearing about it.
- New Jersey – S530 or the “New Jersey Respect for Physicians Act” seeks to create requirements with respect to promptness of insurer responses to prior authorization requests. This bill has been referred to Senate Commerce Committee and is pending review.
- New Mexico – SB135 prohibits prior authorization for FDA-approved prescription drug treatment for an autoimmune disorder or cancer (in addition to SUDs, which is currently provided), unless the generic version is available. This bill passed and was signed into law March 1, 2024. The law applies to plans issued for delivery or renewed on or after January 1, 2025.
- Tennessee – SB 2014 requires that health plans must adhere to 72-hour waiting period prior to imposing as a condition of coverage that the provider promptly contact the health insurer for prior authorization for continued treatment and other care for an enrolled patient. This bill has been referred to the Senate Commerce and Labor Committee.
- Virginia –SB 98/HB 1134 requires that provider contracts with carriers include a specific provision that prohibits carriers from revoking, limiting, conditioning, modifying, or restricting any prior authorization it approved for a prescription drug which has been scheduled, provided, or delivered to the patient consistent with the authorization. This new law becomes effective July 1, 2024.
Keeping you informed
Shifting regulations can be difficult to follow but monitoring them is critical; any impact to the healthcare industry represents an impact to our clients. Ensemble is committed to tracking new legislation as it is drafted and passed. Stay abreast of these latest developments by subscribing to our monthly newsletter, Ensemble Exclusive.
These materials are for general informational purposes only. These materials do not, and are not intended to, constitute legal or compliance advice, and you should not act or refrain from acting based on any information provided in these materials. Neither Ensemble Health Partners, nor any of its employees, are your lawyers. Please consult with your own legal counsel or compliance professional regarding specific legal or compliance questions you have.
