One area, deserving of such attention, is whether a member must pay the balance owed on physician bills. By "balance" we're referring to the balance on a doctor's bill which exceeds the amount determined by the health insurance company to be reasonable for that service. For example, your doctor charges $100 for a particular service and your insurance company finds $80, not $100, to be a reasonable charge. Are you obligated to pay the balance of $20 on that bill?

Association Wins Ban For State Plan

Ban For Local Retirees

But what protections do local retirees have? For them, there are two state laws that protect against balance billing by physicians.

Local retirees, insured by Medicare and a supplement plan (i.e., Medex), cannot be billed for the balance because of Chapter 475 of the Acts of '85. In fact, this same law protects state retirees covered by Medicare and their supplement plan, OME, providing what could be considered a second layer of protection in addition to the aforementioned Chapter 80.

Recognized as the first ever of its kind, Chapter 475 amends the state's physician licensure law and prohibits balance billing of a patient with a Medicare supplement plan. According to Chapter 475, the physician agrees, as part of his license to practice medicine in this state, not to bill a Medicare supplement patient for charges exceeding the rate allowed by Medicare. If the allowable rate for a service is $100, then you, as a Medicare supplement enrollee, cannot be personally billed for any charges above $100.

As was true for Chapter 80 and state retirees living elsewhere, local retirees, who are living outside the Commonwealth, are not protected by Chapter 475. For these retirees, be they state or local Medicare enrollees, the protections are somewhat different.

If one of these retirees is treated by a physician who has accepted "assignment" under the federal Medicare program, he cannot be billed for the balance above the allowable rate. Otherwise, if they go to a doctor not accepting assignment, the balance of the physician's bill is their responsibility.

For example, an out-of-state physician refuses to accept assignment and charges the retiree $110 for a service. If Medicare sets $100 as the allowable charge and pays $80, with the supplement paying its 20% of the allowable charge (or in this case $20), then the retiree is responsible for the remaining $10 balance.

As for the second state law which bans balance billing of local retirees, the deciding factor is what insurance carrier is providing the coverage. Specifically, is the carrier Blue Cross/Blue Shield and, if so, does their doctor participate in the Blue Shield program?

For BC/BS enrollees there is a state law which prohibits their physicians from balance billing if they participate in Blue Shield (Chapter 192, Acts of '84). If the doctor charges $110 but Blue Shield sets the fee at $100, then the doctor cannot bill the retiree for the $10 balance.

This protection is not extended to retirees enrolled in a plan which is not a BC/BS product. Also retirees, who may be covered by BC/BS but live out of state, are not protected and will be responsible for the balance unless the state where they live has a similar ban law.