SENATE BILL REPORT
SB 5579
As of February 3, 2025
Title: An act relating to prohibiting health carriers, facilities, and providers from making any public statements of any potential or planned contract terminations unless it satisfies a legal obligation.
Brief Description: Prohibiting health carriers, facilities, and providers from making any public statements of any potential or planned contract terminations unless it satisfies a legal obligation.
Sponsors: Senators Cleveland, Muzzall and Valdez.
Brief History:
Committee Activity: Health & Long-Term Care: 2/04/25.
Brief Summary of Bill
  • Prohibits health carriers or health care providers from making public statements regarding a possible contract termination, except under certain circumstances.
SENATE COMMITTEE ON HEALTH & LONG-TERM CARE
Staff: Greg Attanasio (786-7410)
Background:

Health carriers must file all provider contracts and provider compensation agreements with the Office of the Insurance Commissioner (OIC) 30 calendar days before use.  When a carrier and provider negotiate an agreement that deviates from a filed agreement, the specific contract must be filed 30 days prior to use.  Any provider compensation agreements not affirmatively disapproved by OIC are deemed approved, except OIC may extend the approval date an additional 15 days with notice before the initial 30-day period expires.  Changes to the previously filed agreements that modify the compensation or related terms must be filed and are deemed approved upon filing if no other changes are made to the previously approved agreement.  OIC may not base a disapproval of the agreement on the amount of the compensation or other financial arrangements between the carrier and provider, unless the compensation amount causes the underlying health benefit plan to be in violation of state or federal law.

 

A health carrier and contracting health care provider must provide at least 60 days' written notice to each other before terminating the contract without cause. Whether the termination was for cause, or without cause, the carrier must make a good faith effort to ensure written notice of a termination is provided at least 30 days before the effective date of the termination, or immediately for a termination for cause that results in less than 30 days notice, to all enrollees who are patients seen on a regular basis by a specialist, by a provider for whom they have a standing referral; or by a primary care provider. OIC must approve the notices sent by carriers to enrollees.
Summary of Bill:

When a contract between a health carrier and a health care provider is expiring by its own terms or for which one party has given notice to the other party of an intended termination in accordance with the terms of the contract, neither the provider, nor the carrier may make or cause to be made public statements, including by directly communicating with impacted individuals, including enrollees and patients, regarding such expiration or termination, unless:

  • such disclosure is to satisfy a legal obligation; or
  • the expiration or termination has already been disclosed publicly because of a legal obligation.

 

A violation of this act is considered a violation of the Consumer Protection Act and the provision of this act may be enforced by the Office of the Attorney General. 
Appropriation: None.
Fiscal Note: Not requested.
Creates Committee/Commission/Task Force that includes Legislative members: No.
Effective Date: Ninety days after adjournment of session in which bill is passed.