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New York’s 2014 Law to Protect Consumers from Surprise Out-of-Network Bills Mostly Working as Intended: Results of a Case Study

In this report, insurance experts share findings from a case assessing New York’s experience with its Surprise Billing law, five years in.

In 2014 New York enacted a first-in-the-nation law designed to protect people from surprise balance bills. The law has been held out as a model for other states as well as potential federal legislation.

Key findings from the report include:

  • A front-loaded legislative process that required key stakeholders (payers, providers, and consumer advocates) to make critical compromises early helped ease implementation.
  • Reports about surprise out-of-network bills went from being a top consumer complaint in New York to “barely an issue.”
  • Both provider and insurer stakeholders view the dispute resolution process as fair, with arbitration decisions roughly evenly split between the two sides.
  • Concerns that the law would have inflationary effects on physician pricing have not yet borne out, but it may take time for the incentives created under the law to change the behavior of market actors.
  • There remain significant gaps in consumer protection, including:
    • Self-funded employer plans are not subject to the law’s protections;
    • The law does not fully protect consumers when the surprise out-of-network bill arises because they have been misinformed – either by their plan directory or their provider’s office staff – about the provider’s network status;
    • Out-of-network hospitals are not subject to the law. Even though health plans are required to pay for emergency services at these facilities, consumers still receive – and many inadvertently pay – surprise bills after an ER visit at an out-of-network hospital.



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