California Senate Approves Reference Based Pricing

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“The bill would relieve patients from having to pay surprise medical bills out of pocket by requiring insurers to reimburse out-of-network doctors and other health providers a “fair amount” and doctors to accept the payments, said its author, Assemblyman Rob Bonta (D-Oakland).”

“That rate would be 125 percent of the amount Medicare pays for the same service or the insurer’s average contracted rate for the service, whichever is greater.”

Editor’s Note: If California passes this bill into law (very likely), Reference Based Pricing in California will take off in the private sector. No network plans, similar to what we have implemented in Texas since 2007, will have solved the problem of balance billing risk. And if Texas passes a similar law TPA’s like Caprock Health Plans and Continental Benefits, both of which administer Reference Based Pricing plans will achieve new business sales that will make Ben Feldman look like an amateur.

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