Most states lack strong protections against balance billing

Insurance benefits
Just six states offer comprehensive protections from balance billing and 15 states offer partial protections. The remaining 29 states and the District of Columbia have no protections.

Just six states offer comprehensive protections from balance billing, according to a new report.

In addition to the states with comprehensive protections in place (New York, California, Illinois, Maryland, Florida and Connecticut), 15 states offer partial protections against balance billing, according an analysis (PDF) from the Commonwealth Fund. The remaining 29 states and the District of Columbia have no protections.

Patients enrolled in employer-backed insurance plans expect that their routine care will be covered because they pay premiums but often receive surprise medical bills for visiting out-of-network doctors at in-network hospitals. A quarter of patients were treated unknowingly by an out-of-network ER doc, and shrinking provider networks exacerbate the problem.

There isn’t much data on how frequently patients are hit with balance bills, according to the report, but it’s especially common in the emergency department; research has suggested that 14% of emergency room visits lead to surprise bills, as do 9% of hospitalizations. The risk is greatest for patients admitted to the hospital from the ER, as 20% were hit with a surprise bill.

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“Consumers expect that their health insurance will cover the cost of most medically necessary care beyond their cost-sharing amounts,” according to the report. “But when emergencies or other unexpected circumstances expose them to out-of-network providers, balance billing can create financial burdens and undermine their confidence that health insurance will protect them from financial hardship.”

The approach in these laws varied between states. Some states prohibit providers from sending balance bills to patients, and others require payers to hold enrollees harmless, often by paying the entire charge. Some states have both rules in place.

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The states with a more thorough approach made their rules comprehensive by applying them to both emergency care and in-hospital providers, applying rules to both HMO and PPO plans and including payment standards or dispute-resolution processes to resolve issues between payers and providers. States with less comprehensive balance-billing measures often limited the rules to HMO plans, limited them to ERs and failed to establish payment standards and dispute-resolution options.