White House To Kick Off Surprise Billing Rulemaking With Interim Final Rule

Inside Health Policy

June 9, 2021 10:34 pm

The first part of the highly anticipated rulemaking on the surprise billing legislation enacted late last year is now under review by the White House Office of Management and Budget (OMB), surprising some stakeholders who expected CMS might miss early deadlines. The interim final rule is expected to encompass provisions of the No Surprise Act — including the formula for the critical “qualified payment amount” and guidance on informed consent — that are statutorily required to be out by July 1 and the subject of heated stakeholder debate.

OMB received the rule, “Requirements Related to Surprise Billing; Part 1,” on June 8.

Loren Adler, associate director of USC-Brookings Schaeffer Initiative for Health Policy, says he’s impressed the rule is already moving, and says that even though it’s an interim final rule, the law doesn’t go into effect until Jan. 1 so he expects CMS will heavily weigh any comments and could make changes.

Under the No Surprises Act providers can no longer charge patients more than the in-network rates for services done in an out-of-network setting, or for treatment done by an out-of-network doctor in an in-network setting. For claims that payers and providers cannot agree on within 30 days, the law sets up an independent dispute resolution process that will go into effect on Jan. 1. Arbitrations will be baseball style, meaning that the arbitrator must choose either the amount sought by the provider or offered by the payer.

The law says arbitrators shall consider the qualified payment amount (QPA), which is generally the median in-network rate used by the payer for that service. But in a last-minute change, Congress added several other factors for consideration, including providers’ level of training, quality and patient outcomes, market share for providers and payers, patient acuity, teaching status and prior contracted rates.

While the dispute resolution process isn’t set to go into effect until Jan. 1, 2022, several key regulatory decisions must be made first.

According to a Commonwealth Fund summary of the act, HHS, working with Labor and Treasury, needs to establish the methodology the health plan must use for a QPA in the individual, small group, and large group markets; the information that plans must share with providers when making a QPA determination; the geographic regions – taking into account services done in rural or underserved areas; and a process for receiving complaints about health plans relating to the QPA.

HHS is required to consult with the National Association of Insurance Commissioners to establish the regions, which must also be updated periodically.

On March 11, NAIC recommended HHS use individual and small market geographic rating areas for the rule but let states with surprise billing laws use their own regions if they choose. States should also be able to seek HHS approval to use alternative regions, NAIC says.

The rule landed at OMB one day after a group of 50 employers, patient advocates and other stakeholders urged the administration to ensure that arbitrators use the QPA as a primary factor in its decision-making, and the other five factors only in certain circumstances.

Other stakeholders, including a bipartisan group of senators, have asked the administration to ensure that all factors are given equal weight.

HHS is also required to craft guidance on the provision that allows out-of-network providers to balance bill a patient who has given consent to non-emergency care no later than 72 hours prior to the delivery of the services. The notice and consent must be written, and must clearly state that consent is optional, the providers is out of network, the patient can choose services from an in-network providers, and that an in-network provider could limit cost-sharing, and more.

The group of 50 stakeholders who wrote to the administration about the QPA also urged the administration to ensure the rule holds patients harmless from surprise bills as intended and leaves no loopholes for the practice to continue. The group says all services deemed medical necessary within 72 hours of delivery should be considered an emergency. “If treatment has started and a patient is incapacitated or in recovery, no level of notice or consent for out-of-network care is appropriate, and patients should have blanket protection from balance bills,” they add.

House Ways & Means Chair Richard Neal (D-MA) made similar comments to HHS Secretary Xavier Becerra in a Tuesday hearing. “Lawmakers did not design any intentional loopholes for, say, a patient to be handed a form when they’re unconscious and then subsequently get a bill that they supposedly agreed to pay,” he said.

On Wednesday, another 22 patient groups — including the American Heart Association, the American Kidney Fund, and the American Cancer Society Cancer Action Network — also urged the administration to focus on protecting patients and ensuring the arbitration process does not lead to higher costs.

“We worked alongside Congress to develop the bi-partisan, bi-cameral legislation to provide protections for patients from receiving unexpected medical bills,” the organizations’ letter states. “To truly ensure that patients are held harmless from surprise billing, however, it is critical that the regulations underpinning the law have robust safeguards for patients,” they wrote.

The groups also call for a comprehensive, well-funded campaign that will make sure consumers are aware of their rights under the law. — Amy Lotven (alotven@iwpnews.com)