No Surprise Medical Billing Rules Finalized; Requiring Medical Plans to Negotiate with Providers, Not Balance Bill the Plan Participant

Originally published by Zywave, a Leavitt Group partner for compliance. Republished with permission. Some content by Leavitt Group.

On Aug. 19, 2022, the Departments of Labor (DOL), Health and Human Services (HHS) and the Treasury (Departments) jointly released a final rule implementing the ban on surprise medical billing under the No Surprises Act (NSA), which was enacted as part of the Consolidated Appropriations Act, 2021 (CAA). The Departments also released FAQs on NSA implementation in conjunction with the final rule that provide more detail on the surprise medical billing ban. The NSA is intended to protect consumers from excessive out-of-pocket medical costs caused by surprise and/or balance billing billing beyond what the plan covers.

These latest rules finalize two interim final rules released in July 2021 and September 2021, with certain changes related to the Independent Dispute Resolution (IDR) process that has been the subject of ongoing litigation and put on hold. For more on the status of the IDR process rulemaking see here. These latest regulations finalize certain disclosure requirements relating to information that group health plans and health insurance issuers offering group or individual health insurance coverage must share about Qualifying Payment Amounts (QPA) proposed in negotiating payment amounts between the plan or insurer and the provider.

The interim final rules became effective for plan years on/after January 1, 2022. These rules will become effective sixty days after the publication date of August 26, 2022 [which is October 24, 2022].

Surprise Medical Bills

Surprise medical bills occur when patients unexpectedly receive care from out-of-network providers (for example, treatment at an in-network hospital involving an out-of-network doctor). Patients often cannot determine the network status of providers during treatment to avoid additional charges and, in many cases, are not involved in the choice of provider at all.

Overview of the Final Rules

The final rule is generally intended to make certain medical claims payment processes more transparent and clarify the process for providers and health insurers to resolve their disputes. It:

Implements certain disclosure requirements related to information that group health plans and health insurance issuers offering group or individual health coverage must share about the QPA (generally, the health plan’s median contract rate for the item or service in the geographic area);
Finalizes certain changes related to the federal IDR process in light of ongoing litigation; and
Requires plans and issuers to disclose additional information in situations where they change a provider’s billing code to one of lesser value(lowering the payment to the provider).

Conclusion

The specific requirements of the No Surprises Act ban on balance “surprise” medical billing apply largely to self-funded plans and insurers. Even self-funded plans will need to work with their underlying plan administrators, network of providers and any related insurers to determine the exact status of your coverage and billing practices. The determination of the Qualifying Payment Amount (QPA) process should be set up according to the terms mandated under these rules. CMS offers a wealth of information and resources to assist. While the latest final rules really only solidified (for now!) the existing interim rules on the QPA process (with the Independent Dispute Resolution rules being put on hold due to litigation), there is still much regulation to be promulgated on the NSA. This set dealt with the exact process of negotiating for contested billed charges. But, this is just the first of many more rules to be expected (e.g., Independent Dispute Resolution, if revived after litigation, Notice of Agreement on Out-of-Network Rate, air ambulance and reporting on pharmacy and prescription drug costs). Rest up those reading eyes…focus to prepare your cognitive mind…because this is not over yet. Be sure you are partnered with a Trusted Advisor like the Leavitt Group. We are here to help navigate plans through choppy new compliance waters. Subscribe to receive our compliance news alerts to keep on top of the latest rules once they are developed.