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The problem this legislation seeks to address is that of balance billing. Balance billing occurs when a physician (or other medical professional such as an anesthesiologist) bills a patient for medical expenses that the patient’s insurance plan does not cover. This issue is especially prevalent during emergency room visits. Moreover, it is very difficult for a patient to find out how much a service would cost for an out-of-network provider. In an emergency situation they have little real choice in the matter. Unfortunately, this means a patient is charged additional medical expenses because, unbeknownst to the patient, a physician or service is not covered under his or her insurance plan.
Previous legislative attempts to address this issue have created opportunities for patients who have been balance billed to seek mediation of their bill if it is greater than $500 and by requiring disclosure notices to be included in balance bills notifying patients of their right to mediation. The purpose of SB 507 is to expand the disclosure requirement so that some professions not currently statutorily required to make the disclosure would be required to do so. The mechanism for achieving this is to redefine several terms in the statute that govern who is required to make such disclosures.
Overregulation of the health insurance and healthcare industries has caused this issue to come into existence. If the free market were allowed to operate in the healthcare industry, this arbitrary billing practice would result in medical care facilities or healthcare providers losing business. Unfortunately, neither health insurance nor healthcare operate in anything resembling a free market. This leads to all sorts of problems from increased costs to lower transparency for consumers to higher costs for insurance and medical care. We agree that this bill seeks to address a serious issue, but we are hesitant to support further regulation because the long term answer to overregulation is not more regulation.
The issue of balance billing is being addressed by many states at differing levels of regulation from the most restrictive - banning the practice altogether - to other, lower levels of intervention. We acknowledge that the intervention proposed by SB 507 is probably the least intrusive of all the regulatory options that might be considered if the legislature is intent on further refining the work it has already done in this area.
While our objection to fighting problems caused by government intervention with still more government intervention stands, it is reasonable to conclude that short of major deregulation of the health insurance and healthcare industries at the federal and state levels a true free market solution to this problem will remain elusive at best.