Out of Network

Labor, Business, and Consumer Groups Call On NJ Legislative Leaders to Pass the Out-of-Network Consumer Protection Bill

Dear Assembly Speaker Prieto,
Dear Senate President Sweeney,

We, the undersigned organizations, are writing to again urge you to please take action to pass A1952/S1285, the Out-of-Network Consumer Protection, Transparency, Cost Containment and Accountability Act.   This legislation is urgently needed to protect New Jersey patients and help control rising health care costs.

As recent research by New Jersey Policy Perspective (NJPP) shows, about 168,000 consumers every year directly receive egregious charges for involuntary out-of-network services. But the practice, in fact, affects most of the five million New Jersey’s privately insured health care consumers, who pay higher premiums as a result of this billing practice. NJPP’s research finds that the added cost to consumers statewide is as much as $1 billion dollars every year. The State Health Benefits Plan is also spending tens of millions of dollars every year to cover the cost of these high out-of-network charges for their beneficiaries. Left unchecked, these unfair and costly out-of-network bills will continue to compromise the ability of consumers, employers, and state and local governments to maintain health care coverage.

Despite these tremendously inflated costs that are passed onto most health consumers in our state, the New Jersey Legislature has failed to act on the problem for a decade. Years of inaction has contributed to the lack of affordable health coverage in our state. New Jersey is now home to the nation’s most expensive health coverage in the nation in the individual market and the second highest in the employer-based market, which is one of the main reasons nearly a million New Jerseyans remain uninsured.

Historic health care reform under the Affordable Care Act (ACA) makes the need for A1952/S1285 even more urgent, as hundreds of thousands of low and moderate income New Jerseyans struggle to pay their premiums and maintain coverage, as the ACA mandates. Without your support and action to pass A1952/S1285, New Jersey’s progress toward implementing the ACA and building an affordable health care system will be undermined and our goal to reach universal coverage will be impossible to reach.

Every day, families across New Jersey receive involuntary surprise medical bills for services rendered at an in-network facility or an emergency room, from providers who they did not select.  Patients can experience bills as high as five, 13, even 27 times the Medicare reimbursement rate for the health care services they receive.  Such bills range from $500 to $25,000 or more, and several bills of over $100,000 have been reported.  These types of charges harm unwitting consumers – sometimes irreparably – when they are referred to collections, damage consumers’ credit, and/or result in bankruptcy. Although the problem of egregious billing is a statewide problem, health care consumers in your State Legislative District and Hudson County are especially hard hit by for-profit health systems like Care Point that operate on an out-of-network business model to maximize profits and allow physicians who practice at their facilities to charge patients excessive, out-of-network rates.

This legislation would bring significant cost savings to New Jerseyans, helping to make health care coverage and care more affordable. The savings to the State Health Benefits plan alone could be as high as $140 million annually. It is why so many diverse organizations representing New Jersey consumers, business and industry, and labor have voiced their support for this legislation.

Furthermore, A1952/S1285 could help bring resolution to the issues that have resulted in the Governor freezing hospital charity care and other payments that will result in a crisis in New Jersey if it is not addressed quickly.  It is why we need to pass A1952/S1285 now.

To that end, we are requesting a meeting with you in the next few weeks to discuss the urgent need for your support of this legislation and how we might work together to ensure its passage without further delay.

On behalf of the many New Jersey health care consumers we represent, we the undersigned organizations thank you for your consideration of this critically important issue and look forward to your reply.


New Jersey Citizen Action
Maura Collinsgru
Health Care Program Director
75 Raritan Avenue, Suite 200
Highland Park, NJ 08904

AARP – Ev Liebman, Associate State Director

AAUP – Biomedical and Health Sciences of NJ, Ilyssa DeCasperis, Executive Director

AFT New Jersey* – Donna Chiera, President

AFSCME New Jersey AFL-CIO* – Robert Little, Plan Design Committee Member

Anti-Poverty Network – Renee Koubiadis, Executive Director

Consumers Union – Chuck Bell, Program Manager

Council of New Jersey State College Locals – Bennett Muraskin, State Representative

CWA Local 1014 – Karl R. Walko, President

CWA Local 1081 – David Weiner, President

CWA/ District 1* – Hetty Rosenstein, Area Director

CWA New Jersey Area (1032) – Patrick Kavanagh, Local President

Family Voices-NJ – Lauren Agoratis, State Coordinator

HPAE** – Ann Towmey, President

National Association of Social Workers-NJ – Walter Kalman, Executive Director

National Multiple Sclerosis Society – Melissa Shifflett, Senior Advocacy Director

National Patient Advocate Foundation – Donna Kauffman, Regional Field Director,
Eastern States

New Jersey AFL-CIO – Eric Richard, Legislative Affairs Coordinator

New Jersey Appleseed, PILC – Renee Steinhagen, Executive Director

New Jersey Association of Mental Health and Addiction Agencies, Inc. (NJAMHAA) –
Debra Wentz, CEO, Executive Director

New Jersey Business & Industry Association (NJBIA) – Melanie Willoughby, Chief Government Affairs Officer

New Jersey Firefighter’s Mutual Benevolent Association* – Abdur Yasin, Plan Design Committee Member

NJEA** – Wendell Steinhauer, President

New Jersey Policy Perspective (NJPP) – Ray Castro, Senior Policy Analyst

New Jersey Public Health Institute – Dr. Drew Harris, Chairman

New Jersey State Pipe Trades Association – Eric Boyce, Vice-President

State Troopers Fraternal Association – Dave Jones, Plan Design Committee Member

NJ Superior Officers Association  Edward F. Sullivan, President

Rutgers AAUP – AFT – Patrick Nowlan, Legislative Representative

South Jersey NOW, the Alice Paul Chapter of the National Organization for Women –
Marilyn Quinn, Liason

Statewide Parent Advocacy Network – Diana Autin, Executive Co-Director

Union of Rutgers Administrators, Local 1766, American Federation of Teachers AFL-CIO –
Lucye Millerand, President

*Member State Health Benefit Plan Design Committee

** Member State Education Health Benefit Plan Design Committee


New Jersey Policy Perspective and the NJ for Health Care Coalition, a diverse collection of organizations (convened by New Jersey Citizen Action) which represent health care consumers, released a report today that illustrates the huge fiscal impact that surprise out-of-network bills are having on consumers and health care costs in New Jersey.

Time for Affordability

How Involuntary Out-of-Network Medical Bills Harm New Jersey Consumers

To download a PDF of this report, click here.

To download a 1-page “Fast Facts” summary of the key findings, click here.

Consumers Union, the policy arm of Consumer Report, has heard from families all across New Jersey who have been hit with surprise out-of-network bills, ranging from $50 to $50,000.  Chuck Bell, Programs Director for Consumers Union, said:

“Surprise medical bills are harsh, unreasonable and unfair hardships for consumers. Consumers overwhelmingly want to be taken out of the middle of health plan-provider disputes that cause emotional stress and anxiety, and cost substantial time and money to resolve. We strongly urge legislators to pass the Out of Network Transparency Act (A1952/S1285) now, a carefully-developed, comprehensive legislation, so consumers don’t have to wait another year or more for these vital new protections to take effect. ”

Stand with us in urging legislators to put an end to these abusive out-of-network billing practices and protect consumers against these unfair and unexpected financial burdens.

Background on Surprise Out-Of-Network Medical Bills

The Affordable Care Act did a lot to expand access to health care and help make the cost more affordable for millions of consumers. But making health care more affordable will require us to change the business of health care.

Consumers need accurate and timely information to make decisions about their health care costs. What those costs are shouldn’t come as a surprise. But often they do because New Jersey law does not protect consumers against bills for services they inadvertently receive from an out-of-network provider. Today, even consumers who take care to make sure the doctor or hospital they choose is “in-network,” can be on the hook for a surprise medical bill for thousands of dollars. You can read some New Jersey consumers’ stories here in our report released by the NJ for Health Care Coalition and Consumers Union.

We need to require provider disclosures that ensure consumers get the information they need to avoid unintended out-of-network charges in the first place. And, we need protections that guarantee consumers will not be on the hook for higher out-of-network costs when no other suitable “in-network” choice is available. Instead, consumers who make a good-faith effort to receive care from in-network providers should only be responsible for the same costs they would have had if the provider had been in-network.

The Out-of-Network Consumer Protection, Transparency, Cost Containment and Accountability Act (A1952/S1285) would change the status quo. Doctors and hospitals would be required to give consumers advance notice about which insurance networks they participate in and a good faith estimate of what their care will cost. This bill would extend protections so more NJ consumers who go to an in-network hospital or surgical center and inadvertently receive care from an out-of-network doctor would not be held responsible for higher out-of-network rates. Instead, patients would not be held responsible for anything beyond the in-network rate.  Anything over that, the doctor and the insurer would have to negotiate and settle on a fair reimbursement, through arbitration.

Stand with us in urging legislators to put an end to these abusive out-of-network billing practices and protect consumers against these unfair and unexpected financial burdens.