New Virginia Law Codifies Assignment Of Benefits In Virginia; How Will Chiropractors, Medpay Carriers And Injured Parties Be Effected?
NOTE: The following is not legal advice.
Effective July 1, 2013 a new law in Virginia will take effect which codifies Assignment of Benefits laws and directs how the law is to be applied by both health care providers and med-pay carriers alike.
The bill modifies VA code section 38.2-22 indicates that any attempt to assign medical expense benefits are subject to the law. Further Assignments are only valid if conditions under the law are met. It should be noted at the outset that this new law does not affect liability coverages. It only applies to patients/claimants have med-pay and health insurance and it deals with how health providers should bill these patients and under what circumstances the med-pay or auto insurance carrier must honor an Assignment of Benefits (AOB) in Virginia.
In a nutshell – Honoring of the AOB will be mandatory when the following rules are followed:
- 1. The Assignment of Benefits (AOB) must be in writing.
- 2. The AOB must be signed and dated by patient
- 3. AOB and notice forms should be sent to med-pay carriers, liability carriers and attorneys by certified mail.
- 4. If the patient does not have health insurance, the doctor, chiropractor or health care provider can bill the medpay directly and the carrier MUST (shall) honor the AOB.
- 5. If the patient has health insurance and the health care provider is in network; as long as the patient provides this information to the health care provider, the health care provider can only bill the patient for co-payment, co-insurance or deductibles and the remainder can be billed to auto insurance benefits such as med-pay.
- 6. Essentially, where health insurance information is provided to the provider – it must be billed first if it is in the provider’s network, prior to the billing of medpay, by the provider.
- 7. If the patient does not provide health insurance information, or the provider is not in network, the provider may bill the full amount to the auto insurance.
- 8. If the health insurance carrier denies a code (for example denies chiropractic treatment as unnecessary) – the patient’s attorney may still be able to get the bill covered under med-pay. (This is the attorney’s usual job in this situation and is not really affected by this new law. Attorneys frequently must file PIP or Med-pay lawsuits to get auto insurance carriers to honor benefits contracts where medical treatment is unfairly deemed unnecessary, duplicative or too expensive by the auto insurance carrier)
- 9. If the injured person does not have insurance or is covered by a self-insured or self-funded employee welfare benefit plan, such as ERISA, (which requires medical expense coverage to be primary), the motor vehicle insurer shall pay directly to the health care provider from any medical expense benefits available to such person under a motor vehicle policy.
- 10. Notwithstanding the above, before signing an Assignment and Authorization Agreement or Assignment of Benefits, patients who are represented by attorneys for motor vehicle accidents should consult with their lawyer to determine the best course of action. Under some circumstances it may make more sense to utilize health insurance as a primary coverage with Med-pay as secondary, for example. Alternatively, some patients may elect to not utilize health insurance at all.
- 11. Like all new laws, there are bound to be some kinks as insurance carriers, providers and attorneys sort out the ramifications of these new rules. Health care providers and insurance carriers will be instituting new policies to deal with these laws, and/or may be altering their regular practices to cope with the new law. If you are an injured party or a health care provider and have questions about how this new Virginia law will affect you, you should consult with an attorney as your circumstances are likely to be unique.