NY Passes Health Care Consumer Protections, then Backsteps

I have written in the past about the needed consumer protections in health care. Price transparency is chief among them. Another is banning blanket consent-to-pay forms without adequate price transparency. New York State passed such a law that was due to take effect late 2024, prohibiting health care providers from forcing patients to sign consent-to-pay forms prior to care and prior to when prices are discussed. The following is from KFF Health News:

Legal analysts described it as the first such law in the country. Physician groups cried foul, saying it would raise payment issues and other significant logistical problems.

Those concerns found traction. Shortly before the law’s start date, the state’s Department of Health delayed its implementation indefinitely. In addition, Democratic Gov. Kathy Hochul’s proposed fiscal year 2026 budget would let providers go back to requiring patients to agree to pay for care in advance of receiving treatment. It also clarified that the consent requirements would not apply to emergency care.

In its current form the law makes little sense. While it is not uncommon to ask customers to agree to pay the cost of services prior to receiving those services, it is not customary to ask someone to agree before they know the cost of service.

A key provision of the new law would remain in place, however: Doctors and other providers would still be obligated to have the cost discussion with patients before the patient is asked to sign the form agreeing to pay for the service. Some consider this a significant step. 

“Providers having an affirmative obligation to discuss treatment costs is unique,” said Gregory Mitchell, a partner in the health and life sciences practice group at McDermott Will & Emery law firm who specializes in managed care. Clients from around the country have been reaching out to the law firm with questions.

Indeed, it is a crucial step. It does little good to discuss prices after a service when it is too late to decline and withhold your patronage. 

Doctors and hospitals argue that medical care is not like appliances. You cannot repossess a liver the way you can repossess a refrigerator. No, but you can decide to get that CT scan somewhere else where your share of the cost is $403 instead of $2,700. My wife avoided that fate only through prior authorization, which hospitals also want to ban. 

I took my car in for service several days ago to repair an air conditioner malfunction. I was not asked to sign anything, but I did talk to a customer service representative and handed over my key fob. A few hours later I received a call from the man assigned to me. He described proposed diagnostic work and told me it would cost $200. A day later he called back and explained I had a leak in a high-pressure A/C hose and suggested replacing it and the compressor ($1,500). He suggested two more items he hoped I would agree to repair, which I declined. My point is that an auto repair shop has customer service reps to explain proposed work and the associated costs. Yet, neither clinics nor hospitals are apparently capable of doing the same. Oddly enough, these same clinics and hospitals find the time to discuss bills you owe once the service has been performed. I suspect the reason they cannot discuss prices ahead of time is because too many patients would walk out the door. Yet, that is how competition works: customers decline a service and start to leave, forcing service providers to negotiate or lose business. 

Kaiser Family Foundation Heath News spoke with one former banker who was declined services of a primary care practice when she refused to sign blanket consent-to-pay forms. Her example is an important one. It has become common to sign forms when handed to you, like a handshake. However, those forms are not for your benefit. Anytime an agreement is handed to you it is always in the self-interest of the party asking you to sign. Do not routinely sign papers merely handed to you. Read them first, take them home to read if needed. In years past the State of Texas even promulgated forms for residential real estate, forbidding realtors from using any other form unless their clients had an attorney draw one up.

More from KFF Health News:

There are other consumer medical debt protections at the federal and state level. The federal No Surprises Act restricts providers from billing consumers for out-of-network services in certain instances. It also requires providers to give good-faith cost estimates for self-pay patients. 

The New York State law is being revised but is still worth watching. Patients need prices before they can compare prices. That will be a tall order for many hospitals, but it is overdue.

Read more at KFF Health News: In New York, Providers Must Put Patient Costs on the Table