Insured patients who receive out-of-network care may receive a “balance bill” for the difference between the practitioner’s charge and their insurer’s contracted rate. In 2017, California banned balance billing for anesthesia care. This study examined the association between California’s law and subsequent payments for anesthesia care. The authors hypothesized that, after the law’s implementation, there would be no change in in-network payment amounts, and that out-of-network payment amounts and the portion of claims occurring out-of-network would decline.
The study used average, quarterly, California county-level payment data (2013 to 2020) derived from a claims database of commercially insured patients. Using a difference-in-differences approach, the change was estimated in payment amounts for intraoperative or intrapartum anesthesia care, along with the portion of claims occurring out-of-network, after the law’s implementation. The comparison group was office visit payments, expected to be unaffected by the law. The authors prespecified that they would refer to differences of 10% or greater as policy significant.
The sample consisted of 43,728 procedure code-county-quarter-network combinations aggregated from 4,599,936 claims. The law’s implementation was associated with a significant 13.6% decline in payments for out-of-network anesthesia care (95% CI, –16.5 to –10.6%; P < 0.001), translating to an average $108 decrease across all procedures (95% CI, –$149 to –$64). There was a statistically significant 3.0% increase in payments for in-network anesthesia care (95% CI, 0.9 to 5.1%; P = 0.007), translating to an average $87 increase (95% CI, $64 to $110), which may be notable in some circumstances but did not meet the study threshold for identifying a change as policy significant. There was a nonstatistically significant increase in the portion of claims occurring out-of-network (10.0%, 95% CI, –4.1 to 24.2%; P = 0.155).
California’s balance billing law was associated with significant declines in out-of-network anesthesia payments in the first 3 yr after implementation. There were mixed statistical and policy significant results for in-network payments and the proportion of out-of-network claims.
- “Balance billing” for out-of-network care has gained significant attention by policymakers and medical specialty stakeholders, culminating in the federal “No Surprises Act” passed in December 2020
- Previous analyses of state-specific legislation were limited by short follow-up periods or unique policy characteristics, leaving few generalizable data to help understand the potential long-term impact of “balance billing” legislation nationally
- The authors estimated the association between the implementation of California’s “balance billing” legislation in 2017 with changes to in-network payment amounts, out-of-network payment amounts, and out-of-network proportion of claims across 2013 to 2020 for common anesthesia care
- Across 4,599,936 claims, California’s balance billing law was associated with a 13.6% decline in out-of-network payments for anesthesia care, translating to an average $108 decrease across all procedures
- In addition, there was a 3.0% increase in payments for in-network care that may have questionable policy significance
- Finally, a 10.0% increase in the proportion of claims that were out-of-network did not meet the statistical significance threshold
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