Who is responsible for payment when the health plan does not allow for out-of-network benefits?

Sometimes, where you get health care—or who provides it—is out of your control. Like when you need emergency care or when an out-of-network provider is involved in your care without your choice. When this happens, the federal No Surprises Act or state surprise billing law may protect you from paying more than your copayment,  coinsurance or deductible. 

Other times, you might choose an out-of-network provider. If you choose an out-of-network provider, the protections of the No Surprises Act or state surprise billing law won’t apply. But your healthcare benefit plan may still cover part of the cost, depending on your plan’s terms. 

This webpage provides a general overview of the federal No Surprises Act and other common out-of-network benefit situations.    

When you don’t choose to receive care from an out-of-network provider, but it happens anyway. 

When an out-of-network provider is involved in your care without your choice, the No Surprises Act may apply and protect you from certain out-of-pocket costs. 

The No Surprises Act applies when you receive the following services:

• Out-of-network emergency services, including air ambulance (but not ground ambulance)
• Out-of-network nonemergency ancillary services provided at a network facility
• Nonemergency nonancillary services provided by an out-of-network provider at a network facility if the out-of-network provider did not get your prior consent as the No Surprises Act requires. 

For the above services, your copayment, coinsurance, or deductible must:

• Be the same as it would have been if the service was provided in your plan’s network
• Be based on what your plan would pay a network provider
• Count toward your network deductible
• Count toward your out-of-pocket limit 

And, for the above services, the out-of-network provider is prohibited by the No Surprises Act from sending you a Surprise Bill. A Surprise Bill is a bill for an amount that is more than your health plan determines it and you (through your copayment, coinsurance, or deductible) should pay. 

So, with the protections of the No Surprises Act, all you have to pay for the above services is your in-network copayment, coinsurance, or deductible. 

The No Surprises Act is a federal law.  Some states have passed state surprise billing laws which offer similar protections and may apply in lieu of the No Surprises Act. For more information on whether state or federal surprise billing law applies to your claim, check your Explanation of Benefits. 

When you choose an out-of-network provider.

When you choose an out-of-network provider, the No Surprises Act or state surprise billing law generally do not apply, and you may face additional out-of-pockets costs, including a Surprise Bill.

But you may still have benefits—some healthcare benefit plans administered or insured by UnitedHealthcare provide benefits for members when they choose an out-of-network provider.   

If the No Surprises Act or state surprise billing law does not apply to a claim submitted by an out-of-network provider, United will look to the member’s benefit plan to determine if it is covered and how it should be paid. 

If the service is covered, one or more of the following reimbursement databases, benchmarks, or methodologies may be used to establish the reimbursement amount for out-of-network claims.  Which option is used depends on various factors, including but not limited to the terms of the healthcare benefit plan, the type of provider, and the type of service.

• CMS. The established and published rates and reimbursement methodologies used by The U.S. Centers for Medicare and Medicaid Services (“CMS”) to pay for specific health care services provided to Medicare enrollees (“CMS rates”). Benefit plans that use this benchmark use a percentage of the CMS rates for the same or similar service.
• FAIR Health. The rate recommended by FAIR Health’s database. FAIR Health is a not-for-profit company, independent of United, that collects data for and manages the nation’s largest database of privately billed health insurance claims. FAIR Health organizes the claims data they receive by procedure code and geographic area. FAIR Health also organizes data into percentiles that reflect the percent of fees billed or allowed.  For example, in a distribution of 100 data points of fees billed, the 70th percentile is the value in the 70th position in the lowest-to-highest array of values, meaning that 70 percent of the values are equal to or lower than the 70th percentile value and 30 percent are equal to or higher than the 70th percentile value. For additional information regarding the FAIR Health Benchmark Databases, please visit FAIR Health's website.
• Viant. A rate recommended by Viant, an independent third-party vendor that collects and maintains a database of health insurance claims for facilities, then applies proprietary logic to arrive at a recommended rate. Viant also organizes its data by percentiles.
• Negotiated Rate. The rate UnitedHealthcare or an independent third-party vendor negotiates with an out-of-network provider after the service was provided. Whether a negotiated rate is available depends on the circumstances and applicable member benefit plan.
• Third-Party Network Discounts. Sometimes UnitedHealthcare may have the right to access contracts and discounts that certain independent third parties have with out-of-network providers.
• Pharmaceutical Methodology.  The rate used to pay pharmaceuticals administered by a physician or other healthcare professional.
• Other Methodologies.

Q. Some health plans have different allowed amounts for facilities and other providers, and some distinguish between physicians and other types of providers. Which amount should they use? Also, should all health plans use the 80th percentile of UCR for the allowed amount comparison?

Insurance Law §§ 3217-a(a)(19)(B) and 4324(a)(20)(B) and Public Health Law § 4408(1)(t)(ii) require health plans to disclose the amount they will reimburse under their OON methodology set forth as a percentage of the usual and customary cost ("UCR").

• This requirement will be satisfied if a health plan provides the approximate percentage of UCR that equates to the reimbursement under the health plan's OON methodology.
• Health plans that have different OON reimbursement methodologies for facilities and other providers need to separately disclose the percentage for the facilities and the percentage for other providers.
• Health plans should use the 80th percentile of UCR for the allowed amount comparison.

Q. If a health plan's allowed amount is a percentage of charges, and there is no percentage of UCR to which it equates, what should the health plan disclose?

The health plan should provide a statement indicating the percentage of charges that the health plan pays.

OON Reimbursement Examples

Q. Should "hospital services" on the OON Reimbursement Examples chart reflect inpatient or outpatient costs?

Insurance Law §§ 3217-a(a)(19)(C) and 4324(a)(20)(C) and Public Health Law § 4408(1)(t)(iii) require health plans to provide examples of anticipated out-of-pocket costs for frequently billed OON services. This requirement will be satisfied if a health plan provides at least three examples which include examples for a colonoscopy (CPT code 45380), spinal surgery (CPT code 63030), and breast reconstruction (CPT code 19357) in a format provided by the Department of Financial Services. The term "hospital services" on the OON Reimbursement Examples chart should reflect outpatient costs for a colonoscopy and inpatient costs for a laminotomy and breast reconstruction. Health plans should add either (outpatient) or (inpatient) after Hospital Services.

OON Make Available Benefit

Q. What should health plans that already filed forms and rates to implement the benefit at the bronze level do to comply with the DFS guidance that provides that a health plan should not offer the OON make available benefit at the bronze level only, unless the health plan offers all other OON coverage at the bronze level only?

The OON make available benefit is not required to attach to every metal level. A health plan should not offer the OON make available benefit at the bronze level only, unless the health plan offers all other OON coverage at the bronze level only. Health plans that filed forms and rates to implement the make available benefit at the bronze level that do not offer all other OON coverage at the bronze level only need to immediately submit new forms and rates and DFS will expedite review.

Claim Submission

Q. Are claims submitted by insureds via facsimile or other electronic means subject to a 45 day or 30 day prompt payment requirement?

Claims submitted by insureds via facsimile or other electronic means are subject to the 45 day prompt payment requirement in Insurance Law § 3224-a(a).

Q. The DFS guidance indicates that health plans are to provide the mailing and electronic addresses for claim submissions on their websites. Some health plans may have multiple mailing addresses for claim submissions dependent upon the region. How is this to be handled?

A health plan may establish a designated electronic and mailing address for submission of claims and should prominently post the address on its website and in plan materials. A health plan may also post language on its website to refer insureds to an address on their health plan identification cards. If a health plan has multiple mailing addresses for claim submissions, it does not need to post all addresses on its website and may post information on its website that refers insureds to their identification cards.

Initial Utilization Review Pre-authorization Approval Determinations

Q. If preauthorization is requested for a service and the person requesting preauthorization identifies a non-participating surgeon and a non-participating facility, would the initial utilization review pre-authorization approval determination need to include the allowed amount for the surgeon and for the facility reimbursement?

Yes, the initial utilization review pre-authorization approval determination will need to include the dollar amount the health plan will pay for both the surgeon and the facility if both are out-of-network.

Q. The DFS guidance states that for preauthorization approval letters, there are 3 options: 1) no provider identified, 2) participating provider identified, and 3) non-participating provider identified. Is it necessary for health plans to state in the letter that no provider was identified, or can the letter be silent if the treating provider wasn't identified?

If no provider is identified, the preauthorization approval determination should specifically indicate that no provider was identified.

Q. For health plans that will cover the service as in-network regardless of whether the provider is participating or non-participating, can the pre-authorization approval letter state that while the identified provider may be either participating or non-participating, the insured will be held harmless?

Yes, the preauthorization approval letter may state that while the identified provider may be either participating or non-participating, the insured will be held harmless.

Q. If a health plan bases its out-of-network reimbursement methodology on a percentage of charges, e.g., 90% of charges for certain services, what should the health plan include as the dollar amount it will pay in preauthorization approval letters?

The health plan's pre-authorization approval letters may state that the health plan pays x% of the provider's charge, and that the insured should consult the provider to determine the provider's charge.

Out-of-Network Referral Denial - Internal Appeals

Q. If an insured requests a referral to a non-participating durable medical equipment (DME) supplier (or another nonprofessional, such as a home care agency), is the referral subject to the OON referral provisions?

Yes, the referral is subject to the OON referral provisions. If the OON referral requirements are met, utilization review and external appeal rights need to be provided.

Q. The OON law and DFS guidance state that for the purpose of providing a written statement for an out-of-network referral to be treated as a utilization review appeal, the patient's attending physician must be a licensed, board certified or board eligible physician qualified to practice in the specialty area appropriate to treat the patient for the service. Why would the patient need to go out-of-network if the attending physician is licensed and has expertise in the specialty area for which a referral is sought?

Insurance Law § 4904(a-2) and Public Health Law § 4904(1-b) require an appeal regarding a referral to an out-of-network provider to be treated as a utilization review appeal and not a grievance if the insured submits a written statement from his or her attending physician that: (1) the in-network provider(s) does not have the appropriate training and experience to meet the insured's particular health care needs; and (2) recommends an out-of-network provider with the appropriate training and experience to meet the insured's particular health care needs who is able to perform the requested service. These sections of the law define attending physician as "a licensed, board certified or board eligible physician qualified to practice in the specialty area appropriate to treat the insured for the service." The attending physician could be the out-of-network provider.

Q. The external appeal provisions for OON referral denials apply to requests for an authorization or referral to an out-of-network provider. Are these requests that are made before services are rendered?

Yes, the external appeal provisions for OON referral denials apply to requests for a preauthorization or referral to an out-of-network provider that are made before services are rendered.

Applicability of Health Plan Disclosure, Utilization Review, External Appeal and Claim Submission Requirements

Q. To which products do the health plan disclosure, utilization review, external appeal for an out-of-network referral denial and claim submission requirements apply?

The health plan disclosure, utilization review, external appeal for an out-of-network referral denial and claim submission requirements apply to the following products:

• Health insurance coverage, HMO, municipal cooperative health benefit plans and student health plans.
• QHPs.
• Grandfathered health plans.
• Hospital only plans and medical only plans with respect to claim submission requirements; with respect to disclosure if coverage is provided on an expense-incurred basis; with respect to utilization review if the plan conducts utilization review; and with respect to external appeal for an out-of-network referral denial if there is a network and the coverage is comprehensive or meets the definition of a managed care product in Insurance Law § 4900(g-6-a).
• Fixed indemnity and limited indemnity plans with respect to the claim submission requirements.
• Stand-alone dental plans with respect to the utilization review and claim submission requirements. The external appeal requirements for an out-of-network referral denial also apply if the dental coverage meets the definition of a managed care product in Insurance Law § 4900(g-6-a).
• Child Health Plus plans.
• Medicaid managed care plans.
• Managed long term care plans.

Some disclosure requirements only apply if the health plan offers out-of-network coverage. Specifically, Insurance Law §§ 3217-a(a)(19) and 20; 3217-a(b)(14); 4324(a)(20) and (21); and 4324(b)(14); and Public Health Law §§ 4408(1)(t) and (u); and 4408(2)(n) only apply if the health plan offers out-of-network coverage.

Some utilization review requirements only apply if the health plan offers out-of-network coverage. Specifically, Insurance Law § 4903(b)(3) and (4) and Public Health Law § 4903(2)(c) and (d) only apply if the health plan offers out-of-network coverage.

The health plan disclosure, utilization review, external appeal for an out-of-network referral denial and claim submission requirements do not apply to the following products:

• Medicare.
• Group Medicare-eligible retiree benefits providing Medicare-supplement-type benefits under a group policy covering only retirees.
• Group Medicare-eligible retiree benefits providing Medicare-supplement-type benefits under a group policy for both actives and retirees.
• Medicare Supplement plans.
• Medicare Advantage plans.
• Fixed indemnity and limited indemnity plans (non-network plans) with respect to disclosure; external appeal for an out-of-network referral denial; and with respect to the utilization review requirements unless they perform utilization review.
• Medicaid fee-for-service.
• Stand-alone dental plans with respect to the disclosure.
• Out-of-state plans (for example, coverage issued to an employer outside NY).
• Self-insured coverage.

Surprise Bills

Q. The definition of "Surprise Bill" includes a referral from a participating provider to a non-participating provider. How does this work when the insured does not request a referral? Also, how does this work when the plan requires prior authorization for an insured to obtain OON services?

A surprise bill includes services referred by a participating physician to a non-participating provider without the explicit written consent of the insured acknowledging that the participating physician is referring the insured to a non-participating provider and that the referral may result in costs not covered by the health plan. A referral to a non-participating provider occurs when (1) the health care services are performed by a non-participating health care provider in the participating physician's office or practice during the course of the same visit; (2) the participating physician sends a specimen taken from the patient in the physician's office to a non-participating laboratory or pathologist; or (3) for any other health care services when referrals are required under the insured's contract (i.e. a gatekeeper).

• If an insured is covered under a contract that requires the insured to obtain a referral before obtaining services and the insured obtains services described in (1) or (2), it will be a surprise bill regardless of whether the insured requested a referral.
• If an insured is covered under a contract that requires the insured to obtain a referral before obtaining services, and the insured obtains services provided by a non-participating physician at a participating hospital or ambulatory surgical center and either a participating physician is unavailable, or a non-participating physician renders services without the insured's knowledge, or unforeseen medical services arise, it will be a surprise bill regardless of whether the insured requested a referral.
• If an insured receives services described in (3) above without requesting a referral, and the services were not otherwise provided at a participating physician's request (and it is not a service described in (1) or (2) above or a service provided by a non-participating physician at a participating hospital or ambulatory surgical facility as described above) it will not be a surprise bill.
• If an insured is covered under a contract that does not have a gatekeeper but requires the insured to obtain preauthorization before obtaining services, and the insured obtains services described in (1) or (2) above, it will be a surprise bill regardless of whether the insured requested preauthorization.
• If an insured is covered under a contract that does not have a gatekeeper but requires the insured to obtain preauthorization before obtaining services, and the insured obtains services provided by a non-participating physician at a participating hospital or ambulatory surgical center and either a participating physician is unavailable, or a non-participating physician renders services without the insured's knowledge, or unforeseen medical services arise, it will be a surprise bill regardless of whether the insured requested pre-authorization.
• If an insured is covered under a contract that does not have a gatekeeper but requires the insured to obtain preauthorization, (3) above would not apply because the insured's contract does not require referrals.

Q. May an out-of-network provider who is referred a patient by the patient's participating physician obtain explicit written consent from the patient, before rendering services, acknowledging that the provider is out-of-network and the referral may result in costs not covered by the health plan?

Yes and if the provider receives the consent, it will not be a surprise bill under Financial Services Law § 603(h)(2).

Q. Is it a surprise bill under Financial Services Law § 603(h)(2) if a participating physician with the patient's health plan (as defined in Financial Services Law § 603(c)) is located outside New York and refers the patient to a non-participating provider without the patient's explicit written consent?

It depends on the circumstances. In order for a bill for health care services to be a surprise bill, the health care services must be provided in, or in certain circumstances, partially provided in New York. If the participating physician and the non-participating referred health care provider are providing services solely outside of New York, then it would not be a surprise bill.

Assignment of Benefits Form

Q. Can a health plan put its logo on the assignment of benefits form when posting the form on its website?

Yes, a health plan may put its logo on the assignment of benefits form as long as the health plan accepts the form without the logo or with another plan's logo on it.

Independent Dispute Resolution

Q. What are the obligations of the primary insurer and secondary insurer when a coordination of benefits provision applies to a claim for emergency services or a surprise bill that is eligible for IDR?

The respective insurer obligations are the same. The primary plan would adjudicate the claim and the secondary plan would cover the remaining portion, as applicable.

Q. Please confirm that the emergency services payment is for the date of service and does not include follow-up care.

Yes, the emergency services payment is for the date of service and does not include follow-up care.

Q. What are the time limits on claim submissions and for submitting a dispute to IDR?

Time limits on claim submissions and for submitting a dispute to IDR are as follows:

• Insurance Law §§ 3216(d)(1)(G), 3221(a)(9), 3224-a(g), 4305(l) and 4306(n) require insureds and providers to submit claims to health plans within 120 days after the date of service unless it was not reasonably possible for the insured to submit the claim in that timeframe. Insurance Law § 3216(d)(1)(G) provides that except absent legal capacity, the insured is required to submit the claim within one year. Insurance Law § 3224-a(h) permits participating providers to request a reconsideration of an untimely claim for up to one year following the date of service.
• There are no timeframes specified for an insured to submit an assignment of benefits form.
• There are no timeframes specified for a provider to submit a dispute to IDR.

Q. Are persons covered under self-insured plans eligible for IDR? Does this impose any direct or indirect obligations on self-insured employer plans or their administrators?

Persons covered under self-insured plans are eligible for IDR pursuant Financial Services Law §§ 605 and 607. However, this does not impose any obligations on self-insured employer plans or their administrators.

Q. Should health plans include the information required by the IDR regulation 23 NYCRR 400.5(f) in their subscriber contracts for the remainder of 2015?

The IDR regulation, 23 NYCRR 400.5(f), requires health plans to post on their websites and include in disclosure materials provided to insureds: (1) a description of what constitutes a surprise bill; (2) a description of the independent dispute resolution process; (3) information on how an insured, non-participating physician or, as applicable, a non-participating referred health care provider, may submit a dispute to an IDRE; (4) an assignment of benefits form for surprise bills; and (5) the health care plan's designated electronic and mailing address where the assignment of benefits form can be submitted. Health plans may satisfy this requirement by posting the information on their websites and by either including the information in their subscriber contracts or in separate disclosure materials. The DFS model contract language for 2016 includes language to comply with this requirement. In the interim, health plans may submit a rider to their contracts with the language or use separate disclosure materials. For Medicaid managed care plans, the required disclosures can be put in the member handbook.

Q. How do health plans and providers submit disputes for IDR?

Health plans and providers may submit a dispute to IDR using the DFS portal on the DFS website.

Q. The IDR regulation, 23 NYCRR 400.5(k), requires health plans to designate, and inform the superintendent of, at least one officer and one staff member knowledgeable about the IDR process who shall be responsible for oversight of the health plan's compliance with the IDR process. Who should this officer be?

Health plans may use the same persons that they have designated for the complaint process to comply with this requirement.

Applicability of the Independent Dispute Resolution (IDR)

Q. To which types of coverage do the Independent Dispute Resolution (IDR) requirements for emergency services and surprise bills apply?

The IDR requirements for emergency services and surprise bills apply to the following types of coverage:

• Health insurance coverage, HMO, municipal cooperative health benefit plans and student health plans.
• QHPs.
• Grandfathered health plans.
• Hospital only plans and medical only plans, if there is a network.
• Child Health Plus (CHIP) plans.
• Medicaid Managed Care (except IDR for emergency physician services is not applicable).

The IDR requirements for emergency services and surprise bills do not apply to the following types of coverage:

• Medicare.
• Group Medicare-eligible retiree benefits providing Medicare-supplement-type benefits under a group policy covering only retirees.
• Group Medicare-eligible retiree benefits providing Medicare-supplement-type benefits under a group policy for both actives and retirees.
• Medicare Supplement plans.
• Medicare Advantage plans.
• Managed long-term care.
• Fixed indemnity and limited indemnity plans (non-network plans).
• Medicaid fee-for-service.
• Stand-alone dental plans with respect to the requirements for emergency services and surprise bills unless services were referred by a participating physician.

Network Adequacy

Q. Does the network adequacy requirement pertain only to new policies and contracts? Will it be required for existing policies and/or modifications to existing policies?

The Insurance Law § 3241(a) network adequacy requirements apply to health insurance policies and contacts with a network of health care providers upon issuance or renewal on and after March 31, 2015. Any contract or rider submitted to DFS on and after March 31, 2015 for a new policy or contract, or for a modification to an existing policy or contract, will need to include network adequacy information. Health plans that want to market the network prior to approval will need to note in materials that the network is pending DFS approval.

Q. Do the network adequacy standards include exceptions to allow for circumstances when service areas do not have the required number of providers or where usage patterns are distinct?

The network adequacy standards do not include specific exceptions to allow for circumstances when service areas do not have the required number of providers or where usage patterns are distinct. DFS will follow the same standards that DOH currently uses in these circumstances.

Q. Which providers may be considered primary care physicians (PCPs)?

DFS will follow the same standards that DOH currently uses to determine which providers may be considered PCPs. PCPs can typically be in one of four primary care provider categories: Internal Medicine, Family Practice, Pediatrics, and General Practice. Physician's Assistants and Nurse Practitioners are not counted in these categories and are therefore not counted toward satisfying the basic minimum requirements for PCPs.

Q. The standards require a fixed number of hospitals in certain counties. Is there a process to request an exception?

The network adequacy standards do not include a process to request an exception. DFS will follow the same standards that DOH currently uses in these circumstances.

Q. Why do time and distance standards allow for exceptions in rural areas, but not in metropolitan areas where usage patterns and availability may also warrant exceptions?

DOH Guidelines for Reviewing MCO Service Delivery Networks do not allow for exceptions to time and distance standards for urban areas. DFS will follow the same standards that DOH currently uses.

Q. When a plan is attesting that its network has been approved by DOH, which date will DFS use since DOH does not issue an approval?

When a health plan attests that its network has been approved by DOH, the health plan should use the date of the statement of agreement with DOH.

Q. If a policy form is approved before the network is approved, can the policy form be marketed?

Yes, if a policy form is approved before the network is approved, the policy form may be used and the health plan's marketing materials should indicate that the network is pending DFS approval.

Q. Some plan networks use the same providers and use the name of the product as the network name. In these cases, are health plans required to submit multiple network filings or could the health plan submit one filing listing the provider network and all of the names used for the network?

Health plans may submit one filing when they have multiple networks with the same providers. Health plans should identify all the names used for the network.

Q. How should tiered networks be filed?

DFS does not distinguish between tiered and non-tiered networks. As such, health plans should follow the same process for submitting a tiered network as they would for a non-tiered network.