Assembly Bill 351 aims to regulate the use of virtual credit card payments in health insurance policies, specifically those classified as disability insurance policies. The bill prohibits insurers from mandating that health care providers accept payments via virtual credit card. It also requires insurers to inform providers about any associated fees with different payment methods and to provide clear instructions for selecting alternatives to virtual credit card payments before the first transaction occurs. The bill defines virtual credit card payments as electronic funds transfers involving single-use numbers that expire upon processing and clarifies that these do not include transactions using physical credit cards.

Additionally, the bill stipulates that insurers or their contracted vendors cannot charge health care providers a fee solely for transmitting payments if they comply with federal electronic funds transmission standards, unless the provider has consented to such a fee. The requirements outlined in the bill cannot be waived, and any contractual provisions that contradict these requirements are deemed void and unenforceable. The bill's provisions will apply to contracts that are entered into, renewed, or modified after its effective date.