California Balance Billing Law

Overview

California AB 72 (2017) prohibits balance billing for non-emergency services where out-of-network providers deliver care at in-network facilities. Patients cannot be charged more than their in-network cost-sharing. Emergency services are excluded from AB 72 and are instead protected under the federal No Surprises Act. The California Department of Managed Health Care (DMHC) enforces these rules for HMOs; the Department of Insurance (CDI) enforces for PPOs.

Key Requirements

1. Emergency services are protected under the federal No Surprises Act, not AB 72. Patients pay in-network cost-sharing.
2. Non-emergency OON providers at in-network facilities cannot bill patients beyond in-network cost-sharing under AB 72.
3. Plans must maintain a dispute resolution process for balance billing claims.
4. Patients can file complaints with DMHC or CDI within 180 days of claim date.
5. OON provider disclosure required before non-emergency services when feasible.

Penalties and Enforcement

DMHC and CDI enforce balance billing violations with fines and corrective action orders. Plans that systematically engage in balance billing face license restrictions and consumer restitution mandates. Providers can lose credentials and network access. Regulatory investigations often result in significant penalties.

Appeals and Exceptions

Disputed balance billing charges can be appealed to the plan and escalated to DMHC or CDI for regulatory review. No exceptions exist for emergency services or OON facility scenarios. Patients have 180 days from claim date to dispute charges.

Interaction with Federal Law

California AB 72 aligns with federal No Surprises Act protections for emergency and facility-based services. California enforcement is often more aggressive. AB 72 applies to health plans regulated by California, regardless of federal ERISA status.

Common Questions