Information may be revised based on regulations yet to be published; updated Jan. 6, 2020
Summary: The Consumer Protection Standards Act requires that a health plan providing a managed care plan must maintain a network that is sufficient in numbers and types of providers to assure that all covered benefits are accessible to their insureds without unreasonable delay. In certain instances the health plan must cover the services of non-participating physicians as if they were in-network.
The statute was revised effective Jan. 1, 2020, and established a maximum payment methodology, banned balance billing, requires that the patient receive notification of the physician’s out-of-network status, and if the physician does not believe that the payment is sufficient to recognize the complexity or circumstances of the care provided the physician can initiate arbitration.
Who must comply: A health plan that offers health benefit plans in Colorado and out-of-network health care providers and facilities in certain circumstances. The requirements of this statute only apply to fully-insured health plans that are regulated by the Colorado Division of Insurance.
Note: The designation “CO-DOI” is on the patient’s card in a clear and conspicuous manner for any and all plans regulated in whole or in part by the Colorado Division of Insurance and therefore subject to the requirements of this statute. (The designation is usually in the bottom left-hand corner of the ID card.)
Requirements/protections: When a covered person receives services or treatment at a network facility, the benefit level for all covered services and treatment received while a patient at the facility shall be the in-network benefit. This includes covered services or treatment when a patient is admitted to an in-network facility by an in-network physician and during the course of the patient’s care is seen by an out-of-network physician who the patient did not have an opportunity to choose; and for out-of-network emergency services. In such circumstances beginning Jan. 1, 2020, the reimbursement to the out-of-network physician will be capped and the physician cannot balance bill the patient for more than his/her in-network cost-sharing. Additionally, the out-of-network physician must provide the patient with specific information including the physician’s non-participation status with the patient’s insurance carrier’s network.
Note: This statute does not apply to the services of non-participating physicians when patients voluntarily seek the care of a physician who is not participating with their insurance carrier’s network.
Colorado Revised Statute: 10-16-704 (3)(d) & (5.5) Consumer Protection Standards Act – Network adequacy - rules – Non-participating Physician Services
Colorado Revised Statute: 24-34-114 Out-of-network health care providers – Out-of-network services – Billing – Payment
- Established a payment methodology (maximum) for out-of-network services. Out-of-network emergency and non-emergency services are reimbursed at the greater of:
- 110 percent of the carrier’s median in-network rate for the same service provided in the same geographic area; or
- 60th percentile of the in-network rate for the same service in the same geographic area for commercial claims from the prior year’s All-Payer Claims Database.
- If the physician questions whether or not the insurance carrier has made the correct payment, the physician can request that the Insurance Commissioner evaluate the payment to ensure that it is based on the highest rate required under the statute.
- Assignment of benefit is mandatory. The insurance carrier must pay the out-of-network physician directly.
- Balance billing is prohibited. The physician can only bill the patient for the in-network cost-sharing amount (deductible, copayment or coinsurance).
- The insurance carrier must notify the out-of-network physician and the patient of the amount of the patient’s cost-sharing.
- If the physician believes that the payment was not sufficient given the complexity and circumstances of the services provided, the physician may initiate arbitration by filing a request with the Insurance Commissioner within 90 days after receipt of payment, notice of payment, or remittance advice. The party that loses the arbitration will be responsible for the arbitrator’s expenses and fees. (See arbitration section below.)
- Physicians must provide patients with a disclosure about the potential effects of receiving non-emergency or emergency services from a physician who is not in-network. (See disclosures section below.)
- Claims must be filed within 180 days of receiving the patient’s insurance information. If a claim is filed beyond 180 days, the physician’s reimbursement will be limited to 125 percent of the Medicare rate.
- If the physician receives an overpayment from the patient of the cost-sharing responsibility, the physician must refund that amount within 60 days of being notified.
Note: A physician’s failure to comply with the provisions of this statute is considered engaging in deceptive trade practice and may be subject to civil penalties and/or action by the Colorado Medical Board.
Colorado Revised Statute: 24-34-113 Health care providers – required disclosures - rules – definitions; and
Colorado Revised Statute: 10-16-704 (3) )(d) & (5.5) Consumer Protection Standards Act – Network adequacy - rules – Non-participating Physician Services
The Division of Professions and Occupations (Colorado Medical Board) will develop rules concerning the content and timing of disclosures in consultation with the Insurance Commissioner and the State Board of Health. This collaboration is to ensure that the message relayed to the patient is consistent across physicians, facilities and insurance carriers. Once the rules have been adopted, this fact sheet will be updated.
In the interim, below is some of the information you may want to consider including on billing statements:
- Include a statement on any billing notice sent to patients for services provided informing them that:
- Based on the health benefit plan information made available to you, you are not participating with their plan.
- You will file the claim directly with their insurance carrier and will accept assignment.
- They may have certain protections under Colorado law, and should contact their insurance carrier for information.
Contact the facilities you work with and request that they always provide your billing office with a copy of the patient’s insurance card. (This will be the easiest way for your billing staff to determine if the patient is covered under a health plan that is subject to the Colorado statute.)
Carrier disclosures: When a covered person has incurred a claim for emergency or non-emergency health care services from an out-of-network provider, the carrier shall provide this disclosure (Appendix A) as a separate document on any explanation of benefits form (EOB) that is provided to the covered person related to the claim. Carriers are also required to make the disclosure available on their website in a clear and conspicuous manner.
The carrier is also required to provide a description of the covered person’s protections in their health plan documents, communications approving (in whole or in part) requests for prior authorization of covered services, and in communications approving (in whole or in part) covered services where a prior authorization is required by the carrier.
Read the complete Division of Insurance Carrier Disclosure rule here.
Colorado Revised Statute: 10-16-704 (3) (d) & (5.5) Consumer Protection Standards Act – Network adequacy - rules – Non-participating Physician Services
This statute has been finalized and should not change
The Insurance Commissioner developed rules to implement the arbitration process that established a standard form and created a list of qualified arbitrators. To be considered a qualified arbitrator, they must be independent, not affiliated with a carrier, facility or health care provider, or any professional association of carriers, health care facilities or providers. They must not have a personal, professional or financial conflict with any parties to the arbitration, and have experience in health care billing and reimbursement.
Arbitration process and timelines:
- The physician must initiate arbitration within 90 days of receiving payment, notice of payment, or remittance advice by filing a request with the Insurance Commissioner. To qualify for arbitration, a physician must:
- Have submitted a claim for a covered service to the carrier 180 days after the receipt of insurance information; and
- Believe that the payment they receive from the carrier was not sufficient based upon the complexity and circumstances of the services provided.
- Prior to initiating arbitration, the physician or the insurance carrier may ask the Insurance Commissioner to arrange an informal settlement teleconference. If agreed to, this will be set up within 30 days of the request.
- The physician and carrier shall notify the Commissioner of the outcome of the teleconference within five business days of the conclusion of the teleconference and are required to inform the Commissioner if the teleconference resulted in a settlement, the detail if a settlement was reached, and if a settlement was not reached a request to appoint an arbitrator.
- If both parties do not agree to an informal settlement teleconference the Commissioner is required to appoint an arbitrator randomly selected from a list of qualified arbitrators in 30 days. If the parties agree to a teleconference but do not reach a settlement, the Commissioner will appoint an arbitrator and notify the parties within 15 days.
- Within 30 days from the notice that an arbitrator has been appointed, each party is required to submit their final offer and the reasoning for that offer in writing. Any patient information submitted in support of the offer must be deidentified.
- If either party does not provide the arbitrator with a final offer within 30 days, the arbitrator must select the received offer.
- If neither parties submit a final offer the arbitration shall be considered complete and the initial payment made to the physician will be considered payment in full by both parties.
- If the carrier believes the health benefit plan does not fall under this statutory purview or that the physician did not submit a claim within the 180 days of receipt of insurance information, the carrier has two business days to provide the Commissioner with corroborating documentation. If the Commissioner agrees, both parties and the arbitrator will be informed of the termination of the arbitration within two business days of the receipt of the carrier’s documentation.
- Within 45 days the arbitrator will pick one of the two amounts submitted and the arbitrator’s decision is final and binding (baseball arbitration).
- In making the decision, the arbitrator shall consider the circumstances and complexity of the particular case, including:
- The physician’s level of training, education, experience and specialization or sub-specialization;
- The physician’s contracted rate, if the physician had a contract with the carrier that was terminated or expired within one year prior to the dispute.
- In making the decision, the arbitrator shall consider the circumstances and complexity of the particular case, including:
- The party whose final offer was not selected must pay the arbitrator’s expenses and fees within 30 days of receiving an invoice from the arbitrator. If the physician is required to pay the expenses and fees and fails to do so within the timeframe required, no further requests for arbitration will be accepted from that provider until any past-due payments have been resolved.
Payment following an arbitration decision:
- If the carrier is required to make additional payments the relevant claim is required to be re-adjudicated within 30 days of the settlement or decision, or be subject to interest and penalties.
- If the carrier is not required to make additional payments the carrier shall notify the covered person of the settlement or arbitration decision and that the out-of-network physician is prohibited from balance billing the covered person. The carrier will also notify the covered person of the out-of-network physician’s requirement to reimburse any overpayment within 60 days of notice of overpayment if applicable.
Beginning July 1, 2021, and every July 1 thereafter, the Insurance Commissioner shall provide a written report to the legislature summarizing:
- The use of out-of-network providers and facilities and the impact on premium affordability for consumers; and
- The number of arbitrations filed; the number settled informally, arbitrated and dismissed in the previous year; and a summary of whether the arbitrations were in favor of the carrier or the out-of-network provider or facility.
Read the Complete Division of Insurance Rule here.