An Act to create 632.872 of the statutes; Relating to: virtual credit card payments in health insurance policies.
Summary
AB351 would create a new statutory section governing how insurers may pay health care providers under health insurance policies, referred to in the bill as disability insurance policies. The bill prohibits an insurer from requiring a provider to accept payment by virtual credit card, which the bill defines as a single-use electronic payment number tied to a fixed amount and processed by the provider through a card terminal or internet portal. It also requires insurers, before first using a virtual credit card payment, to disclose any fees associated with available payment methods and to give clear instructions for choosing an alternative payment method.
The bill further provides that if an insurer or its vendor transmits payment in compliance with specified federal electronic funds transfer standards, it may not charge a fee solely for that transmission unless the provider has agreed to the fee. These protections may not be waived, and any contract term that conflicts with them would be void and unenforceable. The bill would apply to contracts entered into, renewed, or modified on the effective date of the applicable provision.
Impact
AB351 would add s. 632.872 to the Wisconsin statutes and directly regulate insurer payment practices in the health insurance market. It would affect insurers, contracted payment vendors, and health care providers by limiting the use of virtual credit card payments, requiring fee disclosures, and restricting transmission fees unless consented to by the provider. The bill would override contrary contract terms and apply prospectively to affected insurance contracts when entered into, renewed, or modified.
Sentiment
The bill appears to have been framed as a provider-protection measure, with its text emphasizing transparency, choice of payment method, and limits on fees imposed through virtual credit card transactions. No committee transcripts or recorded votes were provided, so there is no documented debate in the supplied materials. The bill ultimately failed to pass pursuant to Senate Joint Resolution 1, indicating it did not advance to enactment despite introduction and referral to the Insurance Committee.
Contention
The main point of contention is likely the balance between insurer payment flexibility and provider protection from fees and forced acceptance of virtual credit card payments. Insurers and payment vendors may view the bill as restricting a commonly used payment mechanism and limiting contractual arrangements, while health care providers would likely support the bill’s fee disclosure and consent requirements. The prohibition on waiving the protections and the voiding of contrary contract terms are especially significant because they would prevent insurers from negotiating around the new rules.