Greater New York Hospital Association

555 West 57th Street / New York, N.Y. 10019 / (212) 246-7100/ FAX (212) 262-6350
Kenneth E. Raske, President

August
Two
2010

Mr. Jay Angoff
Director
~ Office of Consumer Information and Insurance Oversight . penance 7 aie
U.S. Department of Health and Human Services
Attention: OCIIO-9994-IFC
P.O. Box 8016
Baltimore, MD 21244- 1850

Dear Mr. Angoff:

The Greater New York Hospital Association represents the interests of more than 150 hospitals
throughout New York State, New Jersey, Connecticut, Pennsylvania, and Rhode Island. All of
GNYHA’s members are either not-for-profit, charitable organizations or publicly sponsored
institutions. Together, they provide services that range from state-of-the-art, tertiary care to the
most basic primary care, given their roles as safety net providers for many of the communities
that they serve.

I am writing to you in regard to interim final regulations published by the Department of Health
and Human Services on June 28, 2010, implementing certain patient protections enacted by the
Patient Protection and Affordable Care Act (the Act). We greatly appreciate the opportunity to
comment on these important new protections and would like to specifically address provisions
_telating to coverage of emergency services. The Act amended the Public Health Service Act to
“prohibit i insurers from imposing cost-sl sharing Te requirements for emergency services provided by
out-of-network providers that exceed in-network cost-sharing requirements. The definition of
cost sharing, however, excludes the difference between the amount a provider charges and the
amount allowed by the plan. This amount may continue to be balance billed to the patient.

ee

In order to assure that patients are not subject to unreasonable balance billing amounts, the
proposed regulations require that plans pay a reasonable amount for out-of-network emergency
services. Reasonableness is defined as the greater of the following: (a) the amount negotiated
with in-network providers, excluding applicable cost sharing; (b) the amount calculated using the
same method the plan generally uses to determine payments for out-of-network services, (such as
usual and customary charges), excluding applicable cost sharing; (c) the amount that Medicare
would pay, excluding applicable cost sharing. We believe the purpose of this provision is not to
regulate provider payment rates but to protect consumers from unreasonable out-of-pocket


expenses by assuring that the amount paid by the insurer is reasonable. Such protection is not
needed where States have hold-harmless provisions that protect patients receiving emergency
services from non-participating providers. For example, New York requires that HMOs
reimburse emergency services received out-of-network with the patient liability limited to the in-
network copayment amount. HMOs generally pay hospital charges for these services, unless an
alternate amount is agreed to. Since patients are held harmless in these situations and -the
statutory intent of this provision is patient protection, there is no need and no basis for imposing
regulatory standards for insurer payments to providers. It is our view that any reasonableness test
should only be applied where patients are required to pay the excess of the amount the provider
charges over the amount the plan or issuer is required to pay. We respectfully request that this be
clarified in the final regulation.

Again, thank you for the opportunity to provide comments. We look forward to continuing to
_ _,. Work together to implement this landmark legislation,

Sincerely,

?

i
Kefneth E. Raske
President