In a unanimous ruling, the California Supreme Court has held that “balance billing” is prohibited under state law.
Under California law, emergency room physicians are statutorily required to provide emergency care to patients without regard to the patient’s ability to pay. HMOs are also statutorily required to pay for emergency care when the patient is one of their members. Disputes arise when there is no advance agreement between an emergency room physician and an HMO regarding the amount of payment for emergency care. Balance billing occurs when an emergency room physician bills a patient for the difference between the bill submitted to the HMO and the payment received from the HMO.
Surveying state legislation and past legal decisions, the court found that balance billing is clearly banned when an HMO is contractually obligated to pay a hospital; that HMOs are obligated to pay a reasonable amount for emergency care provided to their members; and that emergency room physicians have the right to directly sue HMOs for the reasonable value of their services. The patient, however, can not be brought into the dispute between the physician and the HMO, and balance billing is prohibited.
Read the court’s decision.
