While 2021 ended with uncertainty around the future of the Biden Administration’s Build Back Better Act and the return to any sense of normal, we entered 2022 with the start of hospitals’ and other health care providers’ required compliance with surprise billing regulations. Because we know Vizient members and providers throughout the country have been overwhelmed by the COVID-19 pandemic, here’s what you need to know.
Enacted as part of the Consolidated Appropriations Act, 2021 in December 2020, the No Surprises Act (NSA) protects patients from receiving surprise medical bills (e.g., billing from an out-of-network provider for a medical emergency or from an out-of-network provider at an in-network facility). Among other requirements, the regulations include a framework for dispute resolution between both payers and providers and patients and providers.
Effective January 1, 2022, the new rules will:
- Prevent hospitals and other providers from billing most patients for emergency care at out-of-network facilities, non-emergency care from out-of-network providers at in-network facilities and air ambulance services from out-of-network providers
- Establish an independent dispute resolution process to determine out-of-network payment amounts between providers (including air ambulance providers) or facilities and health plans
- Require good faith estimates of medical items or services for uninsured (or self-paying) individuals, if requested or after items or services have been scheduled. Note that this will be extended more broadly in the future (e.g., to insured)
- Establish a patient-provider dispute resolution process for uninsured (or self-paying) individuals to determine payment amounts due to a provider or facility under certain circumstances
- Provide a way for patients to appeal certain health plan decisions through an external review process when an insurance provider upholds a decision to deny payment
While Vizient remains supportive of efforts to protect patients from surprise bills, we continue to voice concerns with some of the subsequent regulations that disregard the congressional intent of the NSA (Vizient’s September 7, 2021, comments; December 3, 2021, comments).
Our key concerns:
- Independent Dispute Resolution (IDR) process – In the most recent interim final rule, the Office of Personnel Management, Department of the Treasury, Department of Labor and Department of Health and Human Services (collectively, the departments) require that the arbiter (i.e., certified IRD entity) presume that the Qualified Payment Amount (QPA), created using median in-network rates for the geographic area and other factors, is an appropriate out-of-network amount. Relying on the QPA runs contrary to the congressional intent of the legislation and inappropriately favors health plans, among other concerns. Also, there is a lack of clear information about how and when other factors (such as experience or level of training of a provider, patient acuity or complexity, teaching status, etc.) will be factored into the IDR process, further establishing the QPA as the primary factor in determining payment rates.
- Good faith estimates and limited period to develop effective compliance plans – Providers are required to give (potential) patients a “good faith” estimate of their medical items or services. Given the time and administrative burden associated with developing good faith estimates and challenges associated with short-term compliance, we are concerned that the departments have underestimated the difficulty associated with providing good faith estimates and that the variable deadlines for developing compliance plans and processes may cause confusion and redundant work. Health care providers may also have difficulty in identifying items and services to include in the good faith estimate.
- Provider penalties and investigations – Should there be an alleged violation around NSA enforcement, providers and facilities may be subject to a civil, monetary penalty of up to $10,000 per violation and have 30 days from the date of notice of the penalty to request a hearing to appeal the determination. Providers and facilities may also undergo random or targeted investigations conducted by CMS. Combined, these could cause severe financial and operational challenges for health care providers.
Unfortunately, despite various attempts to challenge the Administration’s implementation of these provisions, including a lawsuit filed by hospital and physician groups and congressional opposition in the House and Senate, no changes have been made to the application and enforcement of the surprise billing regulations.
Visit these resources for more information on the new requirements:
- CMS NSA fact sheet
- CMS NSA web page
CMS provider requirements and resources
- Frequently asked questions on the good-faith estimate
- Patient-provider dispute resolution process guidance for providers and facilities, guidance about selected dispute resolution entity, guidance for uninsured or (self-pay) individuals and guidance about the administrative fee
We look forward to working together to help communicate the challenges for health care providers regarding the implementation of the NSA. With that said, please note that despite the legal challenges, the law is in effect. As always, visit our Public Policy and Government Relations webpage to stay updated on the latest legislative or regulatory developments and more on our advocacy efforts.
About the authors:
Mina Kato is the senior advocacy communications and stakeholder engagement manager for Vizient. Prior to joining Vizient, Mina managed advocacy communications initiatives for the Council for Advancement and Support of Education (CASE). She also worked in educational advancement at American University and started her career on Capitol Hill. Mina received her bachelor’s degree in political science with a focus on international affairs from the University of California, Riverside, and her master’s degree in political science from American University.
Jenna Stern currently serves as Vizient’s senior regulatory affairs and public policy director. In this role, she identifies and responds to legislative and regulatory developments of most interest to Vizient’s members. Medicare reimbursement and drug policy are among the topics which Jenna focuses on at Vizient. Prior to joining Vizient, Jenna was the director for health policy at the American Pharmacists Association and a senior associate with Avalere Health, a health care consulting firm in Washington, DC. In her previous roles, she specialized in regulatory affairs, strategy, policy and data analysis for life sciences, health plans and providers. Jenna has also worked at various non-profit organizations focusing on public health and patient advocacy. Her educational background includes a Bachelor of Science in Health Sciences (Hons.) from Brock University and a Juris Doctor with a concentration in health law from Case Western Reserve University. She is admitted to the Maryland bar.