When the 2009 legislative session ended May 1, one particular piece of healthcare legislation drew much attention.

Senate Bill 1122 requiring insurance companies to honor the assignment of benefits to physicians out of network, and not route the payment through patients, is headed to Gov. Charlie Crist's desk for approval in early June. He will have 15 days to sign or veto the bill.

After state lawmakers overwhelmingly approved the bill, which would take effect July 1, opposition mounted from various consumer advocacy groups, whom some say are being funded through Blue Cross Blue Shield of Florida, which vehemently has opposed the bill. On May 19, a broad coalition of consumer groups warned that Floridians would be punished with rising healthcare costs and unexpected out-of-pocket fees. Five groups – The Associated Industries of Florida; Council 79 of the American Federation of State, County and Municipal Employees; Florida PIRG; the Florida Alliance for Retired Americans; and the Consumer Federation of the Southeast – called on Gov. Crist to veto the measure to prevent the bill from undermining Florida's PPO networks and increasing healthcare costs for Florida employers, workers and consumers. The health advocacy group Florida CHAIN was also in attendance to urge veto action.

 

"This bill is bad for consumers and serves no purpose other than to drive up health costs," said Brad Ashwell of Florida PIRG. "We believe this legislation would raise costs system wide by undermining the ability of insurers to negotiate reasonable fees with physicians, causing higher insurance rates and higher out-of-pocket medical bills for Florida patients."

 

According to an actuarial study of the bill provided by Blue Cross and reviewed by Oliver Wyman, an actuarial consultant contracted by the state, the legislation could increase the 2009 cost of the State of Florida Employee Group health insurance plan by $22 million – a burden state taxpayers would pay. Public employees also would face an increase of about $118 million in their share of healthcare costs.

 

"If this bill becomes law as written, patients who go to a doctor for medical care and are hit by unexpected bills could see their credit damaged, their families dogged by collections agencies, and even become victims of lawsuits," said Walter Dartland, executive director of the Consumer Federation of the Southeast. Dartland encouraged lawmakers to include consumer safety provisions to protect Floridians via transparency and consumer disclosure, definition of reasonable charges, and debt collection measures.

 

A day after the press conference, Florida Insurance Consumer Advocate Sean Shaw also weighed in. "Allowing SB 1122 to become law would be a backward step from attempts to corral the spiraling cost of healthcare and more specifically, the direct cost to consumers," he said. "Florida would be heading in the wrong direction and at the wrong time."

Jeff Scott, director of governmental affairs for the Florida Medical Association (FMA), said the pubic relations move was nothing more than "trying to scare consumers, telling them it will raise the cost of healthcare. That's not true."

 

"Blue Cross can't come out and say this directly," Scott said, "because who likes big insurance these days?"

 

During the regular session, Humana lobbyist Harry Spring testified the insurance giant had voluntarily started assigning out of network benefits directly to providers, not to patients, in 2005 and saw no increased costs.

 

"Humana does honor assignment of benefits as assistance to our members and the provider community," said Spring. "We've not seen this as a stumbling block to creating effective and reasonably priced contracts. By honoring assignment of benefits, we believe Humana is providing real choice. All too often, we find out of network providers require prepayment unless assignment is honored. This leaves patients with having to spend thousands of dollars up front to be able to go out of network and wait to be reimbursed partially by their insurer. Our members are generally allowed to see out of network providers without upfront payment, other than co-payments and deductibles, because the provider community knows we pay. I hope the governor signs SB 1122, so we aren't forced to take away this important choice for our members. Choice is what a PPO is all about."

 

Scott said the consumer groups' claims are disconcerting at best. "They're putting out information they know is incorrect," he said. "This bill will help patients. Blue Cross wants to be able to deal directly with the patient and not the physician because they know they can ultimately delay payments. They know providers are more knowledgeable about the assignment of benefits. They know it's a hassle for patients, who do not need another problem to deal with when they're recovering from an illness or surgery or whatever medical reason spurred them to seek medical help. Why they're doing this is beyond me."

 

The controversial issue has been brewing for months. Before public testimony from the March 31 council meeting, FMA executive vice president Tim Stapleton cautioned: "I must warn you ahead of time that you'll be upset when you see the blatant misrepresentations and outright distortions made by lobbyists for the health insurance industry."

 

By early April, the House version of the "assignment of benefits" bill (HB 855) had sailed through its second committee of reference, the House General Government Policy Council, with a 17-0 vote, before moving to the Government Operations Appropriations Committee. The Senate companion bill, Sen. Don Gaetz's SB 1122, easily passed through the Senate Banking and Insurance Committee before ultimately being the "assignment of benefits" legislation passed by state lawmakers.

 

"Like all good stories, this one has a happy ending," said FMA president Steven West, MD. "The good guys win."