SENATE, No. 1000

STATE OF NEW JERSEY

INTRODUCED MARCH 21, 1996

By Senator CODEY

An Act concerning clinical laboratories and amending and supplementing P.L.1975, c.166.

    Be It Enacted by the Senate and General Assembly of the State of New Jersey:

    1. (New section) A clinical laboratory shall present or cause to be presented a claim, bill or demand for payment for clinical laboratory services directly to the recipient of the services unless the recipient of the services or the recipient's responsible party authorizes that the claim, bill or demand for payment be presented to any of the following:

    a. An immediate family member of the recipient of the services or other person legally responsible for the debts or care of the recipient of the services;

    b. A third party payer including a health insurer, a State approved or federally qualified health maintenance organization in which the recipient of the services is enrolled, a governmental agency or its specified agent which provides health care benefits on behalf of the recipient of the services, and an employer of the recipient of the services who is responsible for payment of the services;

    c. A hospital or skilled nursing facility in which the recipient of the services is or has been an inpatient or outpatient;

    d. A substance abuse program in which the recipient of the services is or has been a participant; and

    e. A nonprofit clinic or other health care provider whose purpose is the promotion of public health, from which the recipient of the services has received health care.

    Notwithstanding the provisions of this section to the contrary, in the case of a clinical laboratory which performs services at the request of another clinical laboratory, the clinical laboratory may present the claim, bill or demand for payment to the requesting clinical laboratory.

    2. Section 17 of P.L.1975, c.166 (C.45:9-42.42) is amended to read as follows:

    17. No person shall:

    a. Operate, maintain, direct, or engage in the business of operating a clinical laboratory, as herein defined, unless he has obtained a clinical laboratory license from the department, or is exempt under the provisions of this act.

    b. Collect or receive specimens for analysis by an unlicensed laboratory.

    c. Accept specimens for tests from and make reports to persons who are not legally qualified or authorized to submit specimens to clinical laboratories and to receive such reports, but this shall not prohibit the referral of specimens from one licensed clinical laboratory to another similarly licensed under the laws of the state in which it is located, providing the report indicates clearly the clinical laboratory performing the test and the name of the director of such clinical laboratory.

    d. Either personally, or through an agent, solicit referral of specimens to his or any other clinical laboratory or contract to perform clinical laboratory examinations of specimens in a manner which offers or implies an offer of rebates to a person or persons submitting specimens, other fee-splitting inducements, participation in any fee-splitting arrangements or other unearned remuneration.

    e. Obstruct or interfere with the department or any officer or employee thereof in the performance of any duty imposed by this act.

    f. Collect any amounts that were billed in violation of section 1 of P.L. , c. (C. )(pending before the Legislature as this bill).

(cf: P.L.1975, c.166, s.17)

    3. Section 18 of P.L.1975, c.166 (C.45:9-42.43) is amended to read as follows:

    18. a. Any person convicted of violating any provision of this act or of any rule or regulation adopted hereunder shall be subject to a penalty of not less than $100.00 nor more than $1,000.00 for each violation. The penalty shall be collected, and enforced in summary proceedings under the Penalty Enforcement Law (N.J.S.2A:58-1 et seq.).

    b. A person who collects any amounts that were billed in violation of section 1 of P.L. , c. (C. )(pending before the Legislature as this bill), is liable for, and shall refund on a timely basis to the person who was billed, any amounts so collected.

(cf: P.L.1975, c.166, s.18)

    4. This act shall take effect immediately.

STATEMENT

    This bill provides for the direct billing of patients by clinical laboratories. It prohibits clinical laboratories from presenting a bill for services to any person other than the person who is the recipient of the services, or that person's legal representative. However, upon authorization of the recipient of the services or that person's legal representative, the clinical laboratory may bill the appropriate third party payer, health care facility, clinic or program for the services. The bill provides that any amounts collected in violation of this billing requirement shall be refunded to the payer on a timely basis.

    The direct billing provided for in this bill means that laboratories shall request payment directly from either the patient or a financially responsible third party, rather than the physician who requested the test. Direct billing will help reduce the costs of health care, since the billing of physicians rather than patients promotes the practice of physician mark-ups. Because of these mark-ups for laboratory services, patients or their insurers may be charged amounts that are excessive and disproportionate to the actual expenses incurred by the physician in administering the test and interpreting its results.

Requires clinical laboratories to bill recipients of services directly.