For Consumers

Arbitration and using the Balance Billing Protection Act data set

The Balance Billing Protection Act protects consumers from getting billed by an out-of-network hospital or provider for emergency services or for certain non-emergency services during a scheduled procedure at an in-network hospital or surgical facility. The non-emergency services covered by the law include:

  • Surgery.
  • Anesthesia.
  • Pathology.
  • Radiology.
  • Laboratory.
  • Hospitalist services.

If a consumer is treated by an out-of-network provider or facility for services covered by the new law, the provider or facility will submit the claim to the consumer’s insurer. They will be paid a “commercially reasonable amount” which is based on payments for the same or similar services in a similar geographic area. The insurer and facility or provider must first try to agree on this amount. 

How arbitration works

If the insurer and provider or facility cannot agree on the amount for the service within 30 days, the dispute is settled through arbitration. Either party can start the arbitration process by sending a notice to the insurance commissioner's office. The parties then choose an arbitrator from a list of approved arbitrators or entities providing arbitration services. If they cannot agree on one, the list will be narrowed to five. If the parties still cannot agree, one will be assigned from the narrowed list.

The arbitrator will determine the final payment amount the insurer or provider must accept by choosing one of the parties' best final offer. A data set from the state’s All Payer Claims Database that includes services subject to the Balance Billing Protection Act is available for insurers, providers and arbitrators as an independent source of claims payment information.  

State law (www.leg.wa.gov) requires the party initiating arbitration notify the Office of the Insurance Commissioner. And arbitrators must also report their final decision. Please use the following forms: 

The methodology behind the Balance Billing Protection Act data set

The Office of the Insurance Commissioner contracted with the Office of Financial Management to prepare the data set through its subcontractor, Onpoint Health Data.  The data set was created in consultation with a work group that included representatives of medical providers, hospitals, ambulatory surgical centers and insurers.

The data set only includes services covered by the Balance Billing Protection Act, including emergency services and non-emergency health care services provided to an enrollee at an in-network hospital or in-network ambulatory surgical facility. Key services include:

  • Emergency department.
  • Hospitalists.
  • Pathology.
  • Laboratory.
  • Radiology.
  • Anesthesiology.

The data set must be based on the most recently available full calendar year of data, so claims are for services provided between Jan. 1 - Dec. 31, 2018. The calculations are drawn from commercial health plan claims and exclude Medicare and Medicaid claims, claims paid on other than a fee-for-service basis and denied and orphaned claims. The data set includes the following amounts, which are calculated using the standard Median function in SQL (Structured Query Language):

  • The median in-network allowed amount.
  • The median out-of-network allowed amount.
  • The median billed charge. 

Allowed amount is the sum of the amount paid by the payer and all enrollee cost-sharing.

In addition, the data set must provide the calculations by geographic area. Calculations are based on the insurance commissioner's geographic rating areas as well as at the statewide level. 

The Emergency department facility claims median amounts are reported by Ambulatory Payment Classifications (APC’s) and are expressed as the ratio of what Medicare would pay to the median amount paid for emergency department facility claims in the All Payer Claims Database.

Updates to the data set in subsequent years must be based on the original data set adjusted by the Medical Consumer Price Index (CPI). The April 2020 update to the data set updates these amounts to 2019 with the Seattle-Tacoma-Bellevue Consumer Price Index (CPI)-Medical.