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New Jersey Legislation Could Force Out-of-Network Physicians to Accept In-Network Rates

The New Jersey Healthcare Disclosure and Transparency Act is up for discussion today in the state legislature, prompting healthcare stakeholders to discuss the legislation's potential effect on the industry and out-of-network providers, according to an NJ Spotlight report.

The bill will require health plans to explain to their members the methodology for calculating the portion of a bill they will cover for out-of-network care. The bill requires health plans to post on their website a "clear and understandable" explanation of the plan's out-of-network benefits.

The bill is not popular with physicians for several reasons. First, the bill would require physicians to make a "good faith" effort to collect the patient's share of the bill before billing the insurer. The legislation would allow providers to waive the patient's share in the event of financial hardship, as long as they don't routinely waive the contribution.

The bill would also prohibit out-of-network providers from billing a patient any more than they would have to pay if the provider were in-network. The physician would then only receive what he or she would have received as part of the health plan network.

Randy Minniear, senior vice president of government relations and policy spokesman for the New Jersey Hospital Association, said he's concerned that if out-of-network providers can't bill the patient, they will bill the hospital because they have no ability to collect out-of-network costs. "We can't afford to be reimbursing our physician practitioners in our hospitals," he said.

Mr. Minniear said it is unclear whether the bill would allow out-of-network providers to seek payment from the insurer. According to Lawrence Downs, CEO of the Medical Society of New Jersey, the bill also appears to receive out-of-network physicians working at in-network facilities to accept in-network rates.

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