Surprise medical billing generally occurs when insured patients are unknowingly treated by out-of-network providers or facilities then receive a larger-than-expected bill.
Congress ended this practice in most health care settings in a breakthrough law titled the No Surprises Act (P.L. 116-260), holding patients harmless to their in-network cost-sharing and providing a resolution for payment disputes between providers and payors.
Billing practices are impacted by the law and recent rulemaking – particularly, in supporting the administration of the No Surprises Act’s Qualifying Payment Amount (QPA), Notice and Consent, and patient disclosures.
Requirements Related to Surprise Billing; Part I
Part I of tri-department rulemaking for the law went live July 1, 2021, providing direction on the QPA – essentially the median in-network payment rate – and Notice and Consent, which allows patients to voluntarily agree to receiving balance bills for out-of-network care in limited scenarios.
The Interim Final Rule (IFR) penned by the Department of Health and Human Services (HHS), Department of Labor (DOL) and Department of the Treasury (Treasury) – along with the Office of Personnel Management (OPM), which oversees Federal Employees Health Benefits Plan (FEHB) – also previews how the Biden administration will process complaints of potential violations of the ban on surprise billing.
Comments on the rulemaking were accepted through September 7, 2021, and the regulation took effect September 13, 2021. The applicability date is January 1, 2022.
The No Surprises Act required regulators to establish the methodology for calculating the QPA by insurance market, determine the information plans and issuers must share with out-of-network providers and facilities about the formula, and to define the geographic region, accounting for rural and underserved areas as well as health professional shortage areas (HPSAs).
The QPA serves two primary purposes. First, as the anchor to calculate patients’ out-of-pocket costs, typically based on the median in-network payment rate, since patients are held harmless to their in-network cost-sharing obligation. Second, the calculation is a key factor in resolving out-of-network payment disputes between providers and payors.
The law also obligated the administration to issue guidance on the advance Notice and Consent standards, allowing patients to agree to receiving care from an out-of-network providers or facilities.
To exercise this patient choice, an appointment must be scheduled at least 72 hours prior to receiving care, and the out-of-network providers or facilities must provide written notice to patients that the consent is optional, and the care is out-of-network. Under no circumstances, can Notice and Consent be received in the following scenarios:
- ancillary services, defined as emergency medicine, anesthesiology, pathology, radiology, and neonatology, assistant surgeons, hospitalists, and intensivist;
- diagnostic services;
- specialties listed by the secretary through rulemaking; and,
- care furnished by an out-of-network provider if there are no in-network providers at an in-network facility.
Disclosures for Patients
The No Surprises Act requires providers, facilities, plans, and issuers to post notices on their websites informing patients of their protections under the law for the commercial health insurance market – the protected population. Surprise billing is already generally banned by public payors.
Even more, providers and facilities must provide this information to patients when payment is requested, including out-of-pocket costs, or when they submit claims. And this must be displayed in a publicly accessible location in person, such as the check-in counter. This disclosure must also be provided to patients by plans and issuers on explanation of benefits for care protected by the No Surprises Act.
The patient protections apply to emergency services and post-stabilization services delivered by out-of-network providers or out-of-network facilities, and nonemergency services delivered by out-of-network providers at in-network facilities. Recognizing this scope, providers outside of these practice settings, like primary care physicians, are not subject to the disclosures.
To streamline compliance, regulators released Standard Notice and Consent Documents Under the No Surprises Act as well as a Model Disclosure Notice Regarding Patient Protections Against Surprise Billing that may be used by providers and payors. Additionally, the administration welcomed feedback on ways to improve billing practices to identify claims subject to the law.
Modernized billing systems can simplify the QPA and Notice and Consent, as well as the new disclosure requirements.
The second tri-department Interim Final Rule (IFR) for the No Surprises Act posted September 30, 2021, outlining the independent dispute resolution (IDR) process. Commonly known as arbitration, IDR will resolve payment disputes between what the provider or facility bills and what the plan or insurer covers since neither side can ask the patient to pick up the remainder of the tab starting January 1, 2022 – the date surprise medical billing is banned in most settings.
Next month, we will review how Part II impacts billing practices.
About the Author
Best known in the corridors of Washington simply as Buck, Adam L. Buckalew is a seasoned congressional aide with senior experience on key committees in both the U.S. Senate and the U.S. House of Representatives. Founder of alb solutions – an integrated strategic advisory firm – Buck is a well-respected expert who has advised decision makers across both federal and state governments, the private sector, and political campaigns over the past 15 years.