Surprise billing legislation

What this means for out-of-network PARE providers and facilities

On Oct. 22, 2020, Governor Whitmer signed two bills (Public Act No. 234 and No. 235) into law that prohibits out-of-network PARE providers from sending surprise bills to patients. Surprise billing, or balance billing, has never been allowed for participating providers. Surprise billing happens primarily when a patient receives care at in-network facility but the provider may not be contracted with the insurance carrier and is considered an out-of-network provider.

What’s changing for providers

Under the new law, out-of-network PARE providers are now required to give disclosures ahead of providing service to non-emergency patients, and aren’t allowed to balance bill patients in emergency scenarios.

If the provider fails to give the disclosure of if the member does not sign, the provider cannot balance bill the member. If approved or signed, the patient may be balance billed.

Out-of-network providers are required to give the following to non-emergency patients:

    • A statement that your insurer may not cover all services
    • A “good-faith” estimate for services to be provided
    • A statement that you may request care from an in-network provider
    • An acknowledgement of understanding signed by the patient or their representative that the provider has provided the member with a disclosure form and cost estimate at least 14 days in advance of the service. The form, if signed by the member, would allow the member to be balance billed.

Payment for out-of-network providers

Starting Mar. 1, 2021, out-of-network providers who submit claims to Priority Health will be paid 150% of what Medicare pays OR the plan median contracted rate (for their PARE specialty) for the medical service, whichever is greater. The median amounts are based on the provider’s location, specialty and our in-network rates and are refreshed annually.