Senate Commerce Committee Statement to Senate, No. 1177 — State of New Jersey (May 16, 2022)

Summary

A Senate Commerce Committee statement to the Senate on Senate Bill No. 1177 with committee amendments, State of New Jersey, dated May 16, 2022, reporting the bill favorably. As amended, the bill revises arbitration under the "Out-of-network Consumer Protection, Transparency, Cost Containment and Accountability Act." It extends the settlement negotiation period for inadvertent out-of-network services from 30 to 60 days and the deadline to initiate binding arbitration to within 90 days of the final offer. Arbitration would require final offers differing by $1,000 or higher for billed amounts of $2,500 or more, or $500 or higher below $2,500, and arbitrators must include detailed written findings. The amendments keep certification of arbitrators by the American Arbitration Association.

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SENATE COMMERCE COMMITTEE

STATEMENT TO

SENATE, No.
1177

with
committee amendments

STATE
OF NEW JERSEY

DATED: MAY 16,
2022

The
Senate Commerce Committee reports favorably Senate Bill No. 1177, with committee amendments.

As
amended, this bill amends the “Out-of-network Consumer Protection,
Transparency, Cost Containment and Accountability Act” to revise certain
aspects of the arbitration processes established in that act for claims
involving health insurance carriers subject to the provisions of the act.

The
bill extends the amount of time that the insurance carrier and healthcare
provider have to negotiate a settlement in the event of an inadvertent use of
out-of-network services from 30 to 60 days, and extends the deadline for the
carrier, provider, or covered person to initiate binding arbitration in the
event of a failure to reach a settlement from within 30 days of the final offer
to within 90 days of the final offer. The bill provides that, in order for
binding arbitration to be initiated, the difference between a carrier’s and
provider’s final offers be $1,000 or higher for a billed amount of $2,500 or
more or $500 or higher for a billed amount of less than $2,500.

Finally,
the bill requires an arbitrator to include detailed written findings with each
decision. The detailed written findings are to be an analysis of the decision
including, but not be limited to, information concerning any databases,
previous awards, or other documentation or arguments that contributed to the
arbitrator’s decision.

COMMITTEE AMENDMENTS

The committee amended the bill to remove a provision
requiring arbitrators to be certified by the Department of Banking and
Insurance; thereby preserving the requirement under current law that
arbitrators be certified by the American Arbitration Association.

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