A new California law signed by Governor Gavin Newsom aims to protect patients from balance billing by ground ambulance operators, effective January 1, 2022. Balance billing occurs when patients receive unexpected bills from health care providers that are not in their insurance network. The law was designed to address the financial burden faced by many Californians who require emergency ambulance services on the ground and subsequently receive high bills.
Under the new law, ground ambulance operators are prohibited from billing balances for patients covered by state-regulated health plans. This protection applies to approximately 14 million Californians. In addition, the law places limits on the amount that out-of-network ambulance operators can charge, capping it at the in-network rate. Uninsured people are also protected by the law, ensuring that they are not charged more than the Medi-Cal or Medicare rate, whichever is higher. Importantly, it also prevents ambulance operators and debt collectors from taking legal action or reporting to credit rating agencies against patients for at least 12 months after the first bill.
The high incidence of out-of-network charges for ambulance services on the ground in California places a great deal of financial stress on patients. In fact, the average surprise fee for an ambulance ride in California is $1,209, the highest in the country. The new law aims to ease this burden and give peace of mind to people in stressful situations.
At the federal level, balanced billing is also addressed through the No Surprises Act, which takes effect in 2022. However, federal law does not currently cover ambulance services on the ground, leaving a gap in protections for those patients. An advisory committee established under federal law is working to address this issue nationwide with proposals to ban balance billing on most ambulance rides and limit patients’ financial responsibility to $100.
Overall, California’s new law is expected to save patients an average of nearly $1,100 per emergency ambulance trip and more than $800 per non-emergency ambulance trip in the first year. By establishing regulations and protections, the law aims to provide much-needed relief to Californians facing unexpected and excessive ambulance bills.
What is balance billing?
Balance billing occurs when healthcare providers bill patients the difference between their charges and the amount covered by the patient’s insurance.
Who is protected by the new California law?
The new law protects about 14 million Californians enrolled in state-regulated commercial health plans.
Does the law cover uninsured people?
Yes. The law ensures that uninsured people are not charged more than the Medi-Cal or Medicare rate, whichever is higher.
What are the law’s potential effects on health plan premiums?
Since ambulance rides represent a small percentage of total health plan spending, no significant increase in premiums is expected.
How can patients protect themselves from inappropriate billing?
Patients should review their insurance policy, compare fees with their insurer’s explanation of benefits, and file complaints if necessary.