• Maryland Legislative Update
  • May 15, 2015 | Author: Matthew C. Nelson
  • Law Firm: Pessin Katz Law, P.A. - Towson Office
  • On April 13, 2015 after the release of the traditional sine die balloons and streamers, the first General Assembly of the newly elected Governor Lawrence J. Hogan, Jr. concluded with much success. With bills awaiting signature by the Governor, Governor Hogan signed several bills on April that are of worth noting:
    1. House Bill 230: Health Insurance - Assignment of Benefits and Reimbursement of Nonpreferred providers - Repeal of Termination Date (signed April 14, 2015)
    House Bill 230 made Chapter 537 of the Health Insurance Code permanent by removing the termination date on the assignment of benefits and reimbursement of nonpreferred providers. Essentially, health insurers are now prohibited from issuing Preferred Provider Organization (“PPO”) insurance plans that refuse to honor an Assignment of Benefits (“AOB”) to a health care provider and imposes specific billing, disclosure, and payment rate requirements for certain physicians when they are considered out-of-network by a PPO. This Bill serves to ease the financial burden on patients who use out-of-network providers in hospital settings.

    An AOB is an arrangement between an insurer and insured by which the insured requests their health benefit payments, as established by their individual health insurance plan, be made directly payable to a designated person or facility, such as a physician, a physician’s office, or a hospital. An insured may not be responsible to an on-call physician or a hospital-based physician who is a nonpreferred provider and obtains an AOB from an insured for covered services and promptly informs the insurer that they have accepted the AOB. When accepting an AOB, that physician may not collect or attempt to collect any money owed to the physician by the insured for covered services rendered, except for a deductible, co-insurance or copayment.

    When a physician treats a patient who is a nonpreferred provider and an AOB has not been provided, the physician must, prior to providing any treatment, inform the patient that the physician is a nonpreferred provider, that the insured will be responsible for any payments that exceed the allotted amount the insurer will pay for the treatment provided, and provide an estimate of the amount the insurer will be responsible for.

    Failure for an insurer to abide by these new regulations can result in a penalty up to $5,000.00.
    1. House Bill 1028: Business Occupations and Professions - Real Estate Salespersons and Brokers - Formation of Business Entities and Payment of Commissions (signed April 14, 2015).
    House Bill 1028 allows, with the consent of a licensed real estate broker, one or more licensed real estate salespersons and licensed associate real estate brokers who are affiliated with the licensed real estate broker to organize and wholly own a professional service corporation under the Maryland Professional Service Corporation Act or form a limited liability company under the Maryland Limited Liability Company Act.

    Under this Bill, any licensed real estate broker, an associate real estate broker, or a real estate salesperson may transfer any commission due to the salesperson or associate broker to be paid to the corporation or LLC. However, each member of the Corporation or LLC must be a licensed real estate salesperson or a licensed associate real estate broker. Payment may be made to a non-licensed individual if the payment is made to an individual who holds an out-of-state real estate license and meets certain qualifications, a corporation, or an LLC.