The NYS Department of Financial Services (DFS), which regulates health insurance plans, has issued a new circular letter providing guidance to physicians, dentists, and other health care providers. The new guidance warns that health care practitioners may not charge extra for personal protective equipment (PPE) or other COVID-19 related costs when providing covered services under health and dental plans.
The DFS has received complaints that participating health care providers, particularly dentists, are improperly charging their patients fees for PPE or other charges related to increased costs due to COVID-19. In its August 5 guidance letter, the DFS states a participating provider can’t charge a patient fees in addition to the patient’s financial responsibility for covered services, and insurers shouldn’t cover those charges.
In addition, the DFS won’t allow a health insurance policy to have contract provisions requiring the patient to pay the cost of a participating provider’s PPE. Patients aren’t liable for fees that go beyond their financial responsibility in the insurance policies or contracts. The guidance encourages patients to complain if they become aware that a provider is violating the guidance by charging additional fees.
The new DFS guidance advises insurers to:
- Immediately notify participating providers that PPE fees aren’t allowed and that patients should be held harmless for these charges
- Instruct providers to refund any PPE fees already paid
- Notify insureds that they shouldn’t be charged for PPE fees and provide insureds with insurers’ contact information to submit complaints
- Work with their providers to resolve issues related to increased costs due to COVID-19 so patients won’t have to pay extra fees, which may require that insurers request information from providers whether insureds were charged improper fees
- Work with their providers to ensure refunds are provided to insureds
- Within 90 days, report to the DFS the amount of PPE fees charged to insureds, the number of insureds impacted, and a description of how refunds will be provided
This new guidance was prominently featured on NYS Governor Cuomo’s pressroom site, together with supporting statements from the NYS commissioner of health and the NYS superintendent of financial services.
Notably, the DFS guidance applies only to participating providers who are providing covered services to patients in accordance with their insurance plans. The protection doesn’t extend to self-pay patients. Technically, providers may not be prohibited from charging self-pay patients extra fees to cover COVID-19-related costs. However, this practice could invite unwanted attention from the Office of Professional Medical Conduct or the Office of Professional Discipline. The “failure to use scientifically accepted barrier precautions and infection control practices as established by the department of health …” constitutes professional misconduct for physicians (New York Education Law §6530(47)). In addition, the definition of unprofessional conduct applicable to all health professions includes the failure to use appropriate scientifically accepted infection prevention techniques (8 NYCRR §29.2). Providers are, therefore, expected to employ proper infection-control practices appropriate to the circumstances as a cost of doing business and as part of their professional, ethical obligations. The imposition of additional fees for meeting this basic requirement, especially in the midst of a pandemic, could be viewed as improper under other definitions of professional misconduct, such as exercising undue influence on a patient or exploiting the patient for financial gain (New York Education Law §6530(17)).
If you have any questions regarding the content of this alert, please contact Fran Ciardullo, special counsel, at fciardullo@barclaydamon.com or another member of the firm’s Health Care & Human Services Practice Area.
We also have a specific team of Barclay Damon attorneys who are actively working on assessing regulatory, legislative, and other governmental updates related to COVID-19 and who are prepared to assist clients. You can reach our COVID-19 Response Team at COVID-19ResponseTeam@barclaydamon.com.