Why a lawmaker withdrew surprise-billing legislation prompted by Zuckerberg hospital

California legislation to protect patients from receiving unexpected out-of-network bills after visiting a hospital emergency room was considered earlier this year by state lawmakers.

It passed the state Assembly May 30 and was then sent to the state Senate. But the legislation was ultimately put on hold in July after Assemblyman David Chiu, D-San Francisco, withdrew it.

In a column on latimes.com, Pulitzer Prize-winning journalist Michael Hiltzik outlines how hospitals played a key role in the decision.

He said the bill initially set 150 percent of Medicare reimbursement as the standard benchmark for hospital charges to a non-network health plan. However, that was later amended to the amount that is the average in-network contracted rate in a hospital's geographic area, he wrote. The legislation also offered an appeal option for hospitals via the state.

But California hospitals came out in opposition to what they called "government rate-setting" that would result in hospital closures, said Mr. Hiltzik.

Mr. Chiu, the assemblyman, told Mr. Hiltzik, "We're going after a practice that has generated billions of dollars in profits for hospitals, and hospital CEOs around the state waged very aggressive lobbying to protect those profits."

Mr. Chiu's surprise-billing efforts were prompted by media reports highlighting San Francisco-based Zuckerberg San Francisco General Hospital's out-of-network status with all private health plans, which can leave patients with tens of thousands of dollars in out-of-pocket costs through balance billing.

San Francisco's largest public hospital subsequently updated its billing practices, revealed in April that it will not resume balance billing, and last month finalized its first contract with a commercial payer.

Under the bill introduced by Ms. Chiu, privately insured patients who received emergency care would only be responsible for their copays and deductibles, even at facilities  that are  not in their insurance company network, according to the San Francisco Chronicle. The bill also would set standard rates for medical costs for emergency care at an out-of-network facility.

Read Mr. Hiltzik's full column here.


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