The No Surprises Act 2021 is set to take effect for health plan years beginning on or after January 1, 2022. This legislation expands restrictions on charging health care plan holders out-of-network rates for certain services and includes many medical plan changes and requirements, some of which are listed below.
- No Surprise Medical Billing- amending PHSA, ERISA, IRC- Sec 102
- Ending Surprise Air Ambulance Bills- Sec 105
- No Balance Billing-Sec 103
- Independent Dispute Resolution- Sec. 103
- Ensuring Continuity of Care- Sec 113
- Transparency- Sec 107
- Audits- Sec 102
- Establishing Provider Directories- Sec 116
- State All Payer Claims Databases- Sec 115
See a short summary below for each bullet point.
NO SURPRISE MEDICAL BILLING
The No Surprise Medical Billing Act applies to group health plans, individual health plans, providers of ancillary services and to out-of- network services where surprise bills are a common occurrence, for example, air ambulance transports. This Act does not apply to public government insurance programs.
The Act provides when a patient receives emergency medical services at an emergency department of a hospital or an independent freestanding emergency department, or for certain ancillary services provided by out-of-network providers at in-network facilities, the plan or insurer of the patient shall cover emergency services:
- Without the need for prior authorization
- Whether the health care provider furnishing such services is considered an in-network provider or out-of-network
- Coverage may not be more restrictive or limited if using an out-of-network provider
- The cost sharing requirement for in-network versus out-of-network providers must be equal
- Out of network providers may not bill the plan holder for the difference between in-network and out-of-network rates
- An initial payment or notice denial determination must be made no later than 30 calendar days after the bill for such services is transmitted by such provider or facility
- The amount of any initial payment sent directly to the provider shall first be applied to the out of network rate in excess of the cost-sharing amount of service
ENDING SURPRISE AIR AMBULANCE BILLING
Air ambulance transports, whether emergency or non-emergency may not surprise bill patients. Ground ambulance transports are excepted from this Act; however, the Act establishes a commission to study ground ambulance transport rates and billing practices for consideration in future legislation.
NO BALANCE BILLING
Out-of-network providers of emergency services are not allowed to balance bill patients beyond the applicable in -network cost sharing amount. This also applies to out of network providers who render non-emergency services at an in-network hospital or other facility.
There is an exception to this rule which applies to certain non-emergency service providers if they have provided prior written notice (72 hours) in advance and have obtained client’s consent.
The written notice must contain: i) notification that the health care provider is a non-participating provider, ii) a good faith estimate amount that may be charged to the patient, iii) a list of participating providers who are able to furnish services to patient and iv) information about whether prior authorization or other limitations may be required in advance of receiving such items or services. The notice must clearly state that consent to receive such items and services is optional and that patient should instead seek care with an in- network provider. The notice should be available in 15 most common languages for that area.
Patient consent must be signed in writing, in clear and understandable language and acknowledge that participant has: i) been provided notice; ii) information that the payment of such charge may not accrue toward meeting any in-network deductible or limitation that the plan or coverage places on cost-sharing; and iii) provide participant options for how they receive written notice.
Both the consent and written notice must be dated on the date that participant signed such consent and received such written notice, respectively.
This exception does not apply to emergency medicine, anesthesiology, pathology, radiology, neonatology, and items or services provided by assistant surgeons, hospitalists, intensivist and for diagnostic services, like radiology and laboratory services.
INDEPENDENT DISPUTE RESOLUTION
The Act allows for the insurer or plan and the out-of-network provider to negotiate any bill for out-of-network claims for a period of 30 days. If such negation fails, either party may initiate an Independent Dispute Resolution “IDR” process. The process is as follows:
- After receiving the initial payment from the plan to the provider, or a notice of denial, within 30 days from transmission of the bill, if the provider is not satisfied with the payment, a 30-day open negotiation period begins.
- At the end of the 30-day open negotiation period, if an agreement has not been reached, the plan or provider has 4 days to notify the other party and the Secretary of HHS that they are initiating IDR.
- Within 3 business days of receipt of the IDR initiation notice, a certified IDR entity is selected jointly by both the plan and provider.
- Within 10 days of IDR initiation, the parties must submit final offers and information to IDR. Thereafter, within another 30 days, the IDR entity selects one of the offers submitted.
- The party whose IDR offer is not selected bears the cost of the IDR process. Payment must be made within 30 days of the IDR decision.
- IDR may not be initiated again by the same party for the same services for a period of 90 days after the initial IDR decision is made.
- Parties that use the IDR process will be required to pay an annual administrative fee to the Secretary each year. Amount TBD.
ENSURING CONTINUITY OF CARE
Patients with complex care needs, including those individuals undergoing a course of treatment for a serious condition, those receiving in-patient care, those already scheduled to undergo non-elective surgery, pregnant patients and terminally ill patients, have a 90-day period of continued coverage at in-network cost sharing rates to allow for a transition of care to an in-network provider.
TRANSPARENCY
Group or individual health plans are required to provide plan participants with plan information contained on the insurance ID card or physical or electronic plan document(s) issued to the plan participant. The following information must be included: i) any deductible, ii) any out-of-pocket maximum limitations and iii) the telephone and website address for consumer assistance information relating to those hospitals and urgent care facilities serving the plan.
AUDITS
By October 1, 2021, a rulemaking process shall be established by the Secretary of HHS detailing how group health plans and health insurance issuers offering group or individual health insurance coverage are audited. Audits will be conducted in order to ensure that plans are complying with the requirement of applying a qualifying payment amount and that such qualifying payment amount is applied to the appropriate year. The audit may be taken from a sampling of not more than 25 health insurance issuers offering group or individual health insurance coverage. A complaint about medical billing procedures may prompt an audit. Beginning in 2022, the Secretary shall prepare and submit to Congress reports concerning audits conducted during such year.
PROVIDER DIRECTORIES
Beginning for plans starting on or after January 1, 2022, the Act requires those such health plans to maintain up-to-date directories which meets the following criteria: i) directories must be verified and updated every 90 days; ii) directories must be updated with provider information within 2 business days of receipt from Provider; iii) directories must establish procedure(s) for removal of those providers unable to be verified; iv) within 1 business day, a response to any request regarding the network status of a provider must be provided to the patient and such response must be retained for a period of 2 years; v) directory information must contain Providers information including name, address, phone number, specialty and digital contact information; and vi) the directory must include information concerning balance billing protections, including the amount providers/facilities may charge, protections provided under state law, if any, and state and local agency contact information to report violations.
If the patient provides documentation that they received incorrect information from an insurer about a provider’s network status prior to a visit, then the patient will only be responsible for the in-network cost-sharing amount under the plan.
STATE ALL PAYER CLAIMS DATABASES
The Act establishes a grant program to create, maintain and improve State All Payer Claims Databases. The recipients of the grant program shall make data available to authorized users. Authorized users may include entities such as an employer, health insurance issuer, third party administrator or health care providers who request access to the database for the purpose of improving quality or cost-containment.
Please be aware that the determination of the requirements and the application of specific laws and regulations to each employee welfare plan and/or employer may differ due to a number of variables. Nothing in this newsletter should be construed as tax or legal advice.