Pennsylvania Medical Society v. Foster

McGINLEY, Judge,

dissenting.

I respectfully dissent on the basis that I believe the prohibitions against direct patient billing and balance billing set forth in 75 Pa.C.S. § 1797(a) are not rationally related to *551Act 6’s purpose of effectively reducing the cost of automobile insurance.1

The prohibitions against direct patient billing in 75 Pa. C.S. § 1797(a) and (b), including the exceptions set forth in 31 Pa.Code § 69.22, are overbroad because they do not allow a physician to bill a patient when the identity of the responsible insurer cannot be determined (cases involving liability or uninsured/underinsured coverage). Such a result violates a physician’s right to due process by effectively denying the physician any meaningful opportunity to obtain compensation until legal responsibility is determined.

I also believe that the prohibition against balance billing is not rationally related to the stated objectives of Act 6. Unlike Medicare which the majority notes involves the expenditure and receipt of government funds, Act 6 regulates automobile insurance contracts between private insurance companies and their policy holders. Under the basic principles of contract law the consideration to the insured from the insurer is its promise to pay under the terms of the policy in the event of a loss, including medical expenses, up to the applicable policy limits in return for the policy holder’s payment of the premium. Traditionally, if there are reduced obligations on the insurer’s part, the consideration to be paid by the policy holder is likewise reduced. 75 Pa.C.S. § 1797(a), which limits a physician’s charges to 110% of the prevailing charge at the 75th percentile (Medicare rate),2 is the route chosen by the legislature to reduce premiums, effectively forcing the physician to absorb the difference, or the amount saved by the insurer and its policy holders. This forced participation by the physician in a private contract between the insurer and its policy holder is simply taking from Peter to pay Paul.

*552I agree with the Society’s position that Act 6’s limitations on a physician’s charges will not affect an automobile insurer’s liability. See Majority’s Opinion at 640. Accordingly, I would hold that the prohibitions against direct patient billing and balance billing in 75 Pa.C.S. § 1797(a) and (b) lack a legally rational relationship to the cost of automobile insurance and thus cannot be saved. On this ground, I would declare Act 6 unconstitutional.

. In Pennsylvania Chiropractic Examiners v. Foster, 136 Pa.Commonwealth Ct. 465, 474, 583 A.2d 844, 848 (1990), we determined that the legislature intended to restructure the regulation of motor vehicle insurance and reduce the cost of insurance to policy holders in the Commonwealth.

. I note that the physician may charge his usual and customary charge or actual charge if lower than the Medicare rate.