1Requiring health insurers to disclose fee schedules and all
2rules and algorithms relating thereto; requiring health
3insurers to provide full payment to physicians when more than
4one surgical procedure is performed on the patient by the
5same physician during one continuous operating procedure; and
6providing for causes of action and for penalties.

7The General Assembly of the Commonwealth of Pennsylvania
8hereby enacts as follows:

9Section 1. Short title.

10This act shall be known and may be cited as the Fee Schedule
11Disclosure and Multiple Surgical Procedures Policy Act.

12Section 2. Legislative findings.

13The General Assembly finds that:

14(1) A majority of physicians in this Commonwealth are
15reimbursed for their services to patients by third-party
16payors. In some cases, this contractual relationship between
17physician and insurer has existed for years without the
18physician receiving from the insurer a formal contract or an
19accurate or complete fee schedule detailing fees or the rules
20or algorithms that actually define the rates at which

1physicians are compensated for the services they render to
2the payors' insureds.

3(2) Most health care insurers in this Commonwealth
4refuse to fully and accurately disclose their fee schedules
5to participating physicians; therefore, doctors do not know
6and cannot find out what they will receive in compensation
7prior to performing a service.

8(3) This insurer policy is manifestly unfair to
9physicians. It is a breach of the physicians' contracts and
10it facilitates further breaches of such contracts by making
11it impossible for physicians to enforce their right to full
12payment for services rendered.

13(4) During the course of a single operative session, a
14surgeon may perform multiple surgical procedures on the
15patient. These multiple surgical procedures are separate and
16distinct operations as defined by the Current Procedure
17Terminology Coding System created by the American Medical
18Association and other professional medical societies.

19(5) The Current Procedural Terminology (CPT) Coding
20System is utilized by all physicians to identify to payors
21the services rendered by physicians and that payors purport
22to adopt the same CPT Coding System in defining the services
23for which they compensate such physicians.

24(6) However, contrary to the dictates of the CPT Coding
25System and without disclosing any such deviation to the
26physicians with whom they contract, a number of health care
27insurers in this Commonwealth compensate physicians as if the
28procedures performed in addition to the primary procedure
29were merely incidental to the primary procedure and therefore
30such payors will compensate the surgeon for only one

1procedure.

2(7) This insurer policy is inconsistent with the medical
3judgments upon which the CPT Coding System is based, it is
4not accurately disclosed to physicians, it is manifestly
5unfair to surgeons, it leads to a lack of access to quality
6health care services for patients, and it adds to the excess
7profits insurers take from the health care delivery system.

8Section 3. Declaration of intent.

9The General Assembly hereby declares that it is the policy of
10this Commonwealth that:

11(1) Physicians should receive from health care insurers
12a complete and accurate schedule of the reimbursement fees,
13including any rules or algorithms utilized by the payors to
14determine the amount physicians will be compensated if more
15than one procedure is performed during a single treatment
16session.

17(2) Insurers must comply with their contractual
18obligations and surgeons should be fairly and justly
19compensated for all surgical procedures they perform in a
20single operative session.

21Section 4. Definitions.

22The following words and phrases when used in this act shall
23have the meanings given to them in this section unless the
24context clearly indicates otherwise:

25"CPT." Current Procedural Terminology used by physicians as 
26developed by the American Medical Association.

27"Fee schedule." The generally applicable monetary allowance 
28payable to a participating physician for services rendered as 
29provided for by agreement between the participating physician 
30and the insurer, including, but not limited to, a list of 

1Healthcare Common Procedural Coding System (HCPCS) Level I 
2Codes, HCPCS Level II National Codes and HCPCS Level III Local 
3Codes and the fees associated therein; and a delineation of the 
4precise methodology used for determining the generally 
5applicable monetary allowances, including, but not limited to, 
6footnotes describing formulas, algorithms, rules and 
7calculations associated with determination of the individual 
8allowances.

9"HCPCS." The Healthcare Common Procedural Coding System of 
10the Health Care Financing Administration that provides a uniform 
11method for health care providers and medical suppliers to report 
12professional services, procedures, pharmaceuticals and supplies.

13"HCPCS Level I CPT Codes." The descriptive terms and 
14identifying codes used in reporting supplies and pharmaceuticals 
15used by, and services and procedures performed by, participating 
16physicians as listed in the CPT.

17"HCPCS Level II National Codes." Descriptive terms and 
18identifying codes used in reporting supplies and pharmaceuticals 
19used by, and services and procedures performed by, participating 
20physicians.

21"HCPCS Level III Local Codes." Descriptive terms and 
22identifying codes used in reporting supplies and pharmaceuticals 
23used by, and services and procedures performed by, participating 
24physicians which are assigned and maintained by Pennsylvania's 
25Centers for Medicare and Medicaid Services carrier.

26"Insurer." Any insurance company, association or exchange 
27authorized to transact the business of insurance in this 
28Commonwealth. This shall also include any entity operating under 
29any of the following:

30(1) Section 630 of the act of May 17, 1921 (P.L.682, 

1No.284), known as The Insurance Company Law of 1921.

2(2) Article XXIV of the act of May 17, 1921 (P.L.682, 
3No.284), known as The Insurance Company Law of 1921.

4(3) The act of December 29, 1972 (P.L.1701, No.364), 
5known as the Health Maintenance Organization Act.

6(4) 40 Pa.C.S. Ch. 61 (relating to hospital plan 
7corporations).

8(5) 40 Pa.C.S. Ch. 63 (relating to professional health 
9services plan corporations).

10(6) 40 Pa.C.S. Ch. 67 (relating to beneficial 
11societies).

12"Participating physician." An individual licensed under the 
13laws of this Commonwealth to engage in the practice of medicine 
14and surgery in all its branches within the scope of the act of 
15December 20, 1985 (P.L.457, No.112), known as the Medical 
16Practice Act of 1985, or in the practice of osteopathic medicine 
17within the scope of the act of October 5, 1978 (P.L.1109, 
18No.261), known as the Osteopathic Medical Practice Act, who by 
19agreement provides services to an insurer's subscribers.

20Section 5. Disclosure of fee schedules.

21Within 30 days of the effective date of this section,
22insurers shall provide their participating physicians with a
23copy of their fee schedule, including all applicable rules and
24algorithms utilized by the insurer to determine the amount any
25such physician will be compensated for performing any single
26procedure and any group of procedures during a single treatment
27session, which are applicable on July 1, 2004, and annually
28thereafter. Insurers shall also provide participating physicians
29with updates to the fee schedule as modifications occur.

30Section 6. Procedure for payment of multiple surgical

1procedures.

2When a participating physician performs more than one
3surgical procedure on the same patient and at the same operative
4session, insurers shall pay the participating physician the
5greater of the amount calculated on the basis of the applicable
6insurer fee schedule and:

7(1) any rules, algorithms, codes or modifiers included
8therein, governing reimbursement for multiple surgical
9procedures; or

10(2) the principles governing reimbursement for multiple
11surgical procedures set forth and established by the Centers
12for Medicare and Medicaid Services within the United States
13Department of Health and Human Services, including the rule
14mandating payment to the physician of:

15(i) 100% of the generally applicable maximum
16monetary allowance for the procedure which has the
17highest monetary allowance.

18(ii) 50% of the generally applicable maximum
19monetary allowance for the second through fifth
20procedures with the next highest values.

21(iii) Such payment amount as is determined following
22submission of documentation and individual review for
23more than five surgical procedures.

24Section 7. Contract provisions.

25Any provision in any contract, insurer policy or fee schedule
26that is inconsistent with any provision of this act is hereby
27declared to be contrary to the public policy of the Commonwealth
28and is void and unenforceable.

29Section 8. Violations.

30An insurer violates:

1(1) Section 5 if the insurer fails to provide a
2participating physician with a copy of the fee schedule and
3updates to the fee schedule in the time frame provided in
4section 5.

5(2) Section 6 if the insurer fails to adhere to the
6policy for payment of multiple surgeries as set forth and
7established by the Centers for Medicare and Medicaid Services
8within the United States Department of Health and Human
9Services.

10Section 9. Cause of action.

11In addition to all statutory, common law and equitable causes
12of action which already exist, a participating physician shall
13have a private cause of action for any violation of any
14provision of this act to enforce the provisions of this act. A
15participating physician shall be entitled to recover from an
16insurer any legal fees and costs associated with any suit
17brought under this section.

18Section 10. Termination of agreement.

19In addition to other remedies provided in this act, a
20participating physician may terminate the physician's agreement
21with an insurer if the insurer violates the provisions of this
22act. The physician may continue to provide services to the
23insurer's insureds and shall receive compensation as an out-of-
24network provider.

25Section 11. Penalties.

26Violations of this act shall be considered violations of the 
27act of May 17, 1921 (P.L.682, No.284), known as The Insurance 
28Company Law of 1921, and are subject to the penalties and 
29sanctions of section 2182 of The Insurance Company Law of 1921.

30Section 20. Effective date.

1This act shall take effect immediately.