A map of all 50 states, with each state looking like its state flag ()Image: Thinkstock) (Image: Thinkstock)

A new law in Oklahoma could keep health insurers in the state from paying health care providers solely with credit cards.

Oklahoma Gov. Kevin Stitt has signed a bill, House Bill 1157, that prohibits credit-card-only payment requirements. HB 1157 passed unanimously in both the Oklahoma House and the state Senate.

Beginning in 2020, under the terms of the new law, health insurers and health maintenance organizations must offer health care providers, such as doctors and dentists, a choice of reimbursement options. Those options could include, but aren’t restricted to, credit card payment arrangements.

(Related: 10 Top States for High Earner Obesity)

In the bill, credit card payments are defined as an electronic transfer of funds in which the health insurance entity issues a single-use series of numbers that reimburse the health care provider’s fee. The health care provider is then responsible for processing the payment through a credit card terminal or Internet portal.

If a health insurer and health care provider agrees to an electronic transfer of funds, the insurer is required to inform the provider of any fees associated with the payment. Additionally, the health insurer is prohibited from charging a fee simply for processing a payment made through the Automated Clearing House Network unless the health care providers has agreed to the fee.

A health insurance plan cannot write a contract that exempts it from this provision. Violators will be penalized by the state’s insurance commission, under the terms of the new law.

The Rationale

The American Medical Association, the American Hospital Association, the Medical Group Management Association (MGMA) and the Electronic Payments Association sent a letter about the payment choice issue to the U.S. Department Health and Human Services secretary in 2014.

The provider groups told HHS that credit card system fees reduce providers’ net revenue, and that opting out of a mandatory credit card payment process was difficult.

In 2017, the Centers for Medicare and Medicaid Services (CMS) said health insurance plans cannot force physicians to accept virtual credit card payments.

Georgia adopted a health care provider payment choice law based on Georgia House Bill 818, last year, and Arizona recently adopted a provider payment  choice law based on Arizona.

Resources

More information about HB 1157 is available here.

— Read 10 States Where Stroke May Hurt Your Sales, on ThinkAdvisor.

— Connect with ThinkAdvisor Life/Health on FacebookLinkedIn and Twitter.