Effective January 1, 2021, §§ 38.2-3445 through 38.2-3445.2 of Article 6, Chapter 34 of Title 38.2 of the Code of Virginia (collectively, “Balance Billing Law") prohibits the balance billing of enrollees by out-of-network health care providers for emergency services, and by out-of-network providers of surgical or ancillary services at in-network facilities for nonemergency services, for any amount other than the enrollee's applicable health plan cost-sharing requirements.

Under the Balance Billing Law, if a health care provider disputes the amount to be paid by the health carrier(*1) for services rendered to an enrollee, the provider and the health carrier shall make a good faith effort to reach a resolution on the amount of the reimbursement. If the health carrier and the provider do not reach a resolution, either party may initiate arbitration to determine a commercially reasonable payment amount.

The Balance Billing Law, among other things, directs the State Corporation Commission ("Commission") to establish a framework for arbitration of such disputes to include: (i) a timeline for the proceedings; (ii) a method for choosing an arbitrator; (iii) a fixed fee schedule for the costs of arbitration; (iv) required and optional factors for the arbitrator to consider; (v) non-disclosure agreements; (vi) reporting requirements; and (vii) a process for appeals based on specified criteria, including abuse of arbitration proceedings. The Commission did so, and these regulations are now located at 14VAC5-405-10 et seq.

The Commission is required to prepare an annual report summarizing the dispute resolution information provided by arbitrators. The Commission is to post this report on the Bureau of Insurance ("Bureau") website and submit the report to the Chairs of the House Committees on Labor and Commerce (now the Committee on Commerce and Energy) and Appropriations, and the Senate Committees on Commerce and Labor and Finance and Appropriations by July 1. This report provides a summary and information for arbitrations that were decided between June 1, 2021, and May 31, 2022 ("Reporting Period").

During the Reporting Period:

• The Commission received 709 arbitrators’ decisions.

• The 709 arbitration decisions were rendered on behalf of six provider practices.

• Eleven carriers in six groups were named in the decisions.

• Of the 709 decisions, 445 (62.8%) were decided in favor of the health carrier and 264 (37.2%) were decided in favor of the provider.

• The number of practitioners represented in the decisions ranged from one decision for 84 different practitioners to 31 decisions for one practitioner.

• Three practice specialties were represented in the decisions, with Emergency Medicine in 60.9% of the decisions, Anesthesia in 36.8%, and Plastic or Reconstructive Surgery in 2.3%.

• The average health carrier offer prior to arbitration per decision was $362.51, the average provider offer prior to arbitration per decision was $1,736.14, and the average amount awarded was $918.93.

• Medical doctors represented 81% of the rendered decisions, with certified registered nurse anesthetists representing 15.5%.
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(*1) “Carrier" refers to (i) a health carrier as defined in § 38.2-3438 of the Code of Virginia; (ii) an entity administering a self-insured plan that elects to be subject to the Balance Billing Law; or (iii) an entity providing health insurance coverage to Virginia state employees.