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Healthcare Alert: Illinois out-of-network hospital-based physicians face cuts in reimbursement

Illinois Public Act 96-1523 took effect on June 1, 2011. This Act amended the Illinois Insurance Code by establishing a negotiation and arbitration procedure to determine the reimbursement level for out-of-network radiology, anesthesiology, pathology, emergency physician, and neonatology services that are performed at an in-network hospital or ambulatory surgery center.
The Illinois State Medical Society and other physician associations had supported House Bill 1577, which would have postponed the effective date of PA 96-1523. The Illinois General Assembly adjourned for the summer on June 1, 2011, however, without passing HB1577.

The ultimate impact of PA 96-1523 will depend on a number of factors, including regulations to be issued by the Illinois Department of Insurance, future support for legislative changes, experiences with the arbitration process, and negotiation strategies of health plans and providers. The Act is expected to dramatically reduce payments that Illinois radiologists, pathologists, anesthesiologists, emergency physicians and neonatologists receive for their out-of-network services and to change the dynamics for negotiations between health plans and facility-based physicians. In addition, it will be increasingly important for facility-based providers to monitor their reimbursement, determine when the Act applies (keeping in mind that not all health plans or out-of-network services fall within the statute), and be prepared to support the requested levels of reimbursement.

For a description of the Act and some of its likely implications, please see our March 2011 Alert, Illinois statute changes reimbursement for out-of-network hospital-based physicians.

For more information, please contact:

Rick L. Hindmand
312.642.2203
rhindmand@mcdonaldhopkins.com

or any of our healthcare attorneys by clicking on the Healthcare Practice link below:

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