No Surprises Act 2022: Provisions Protect Patients from Unexpected Out-of-Network Medical Expenses

No Surprises Act 2022: Provisions Protect Patients from Unexpected Out-of-Network Medical Expenses

Designed to protect consumers from unanticipated medical bills when they unknowingly receive out-of-network health services, the No Surprises Act (NSA) was part of the Consolidated Appropriations Act; which was signed into law on December 27, 2020, with provisions of the legislation taking effect on January 1, 2022.

The legislation aims to help patients better understand health care costs before receiving care and eliminate unexpected charges. The “Surprise” noted in the title of the act refers to balance billing, when a provider bills the patient for the balance of the charges that the health plan does not cover. This occurs most often when an out-of-network provider’s services are used instead of those of an in-network provider.

Resources on the NSA from CMS and AMA

CMS has developed a comprehensive fact sheet on the NSA, including policies and resources for providers, resolving out-of-network disputes and consumer information. Details of the legislation and regulations are included.

Regulations for implementing the legislation have implications for medical practices. To prepare health care providers for the NSA, the AMA issued a CPT Assistant Bulletin on the Act in December of 2021 (Volume 31 Bulletin 2/2021). In addition, AMA released a tool-kit in January 2022, along with a webinar, podcast and other resources. These items include details on the act, its provisions, and important information for medical practices including AMA’s ongoing advocacy on elements of the regulations.

NSA Requirements

The NSA requires health plans to use in-network cost sharing limits for patients’ covered services in three main types of situations:

• Emergency services, whether provided by an in-network or out-of-network site. These must be covered at the in-network rate.
• Non-emergency services from an out-of-network provider as part of an encounter at an in-network health care facility. For example, a surgical service performed by an in-network provider, with an ancillary service from an out-of-network provider such as an anesthesiologist, radiologist, pathologist, etc.
• Air ambulance services that are covered by the patient’s health plan but provided by an out-of-network air ambulance service. Note that ground ambulance services are not covered by these provisions.

In these circumstances, patients are responsible only for cost-sharing amounts that would have been charged if their services were provided by an in-network provider. These amounts count towards the patient’s deductible and out-of-pocket maximums. The patient’s charges are calculated using median in-network rates known as the qualifying payment amount (QPA). Details on the method for determining the QPA are available in the AMA materials; they are under some dispute by the AMA and AHA, with more details expected on this part of the process.

There is an initial payment or a denial decision sent to the provider from the health plan within 30 days after the provider transmits the bill to the health plan. Essentially, the NSA takes the patient out of the process of remedying any difference between the in-network or out-of-network cost of the medical services between the health plan and the provider.

Provider Actions Based on Out-of-Network Rates

Once the provider receives payment or notification of denial of payment from the health plan, they may either accept the payment decision or disagree with the amount or denial within 30 days of receipt of the notice. Any dispute results in a 30-day maximum open negotiation period between the provider and the health plan. An agreement on the payment amount may be settled upon during this process.

If this cannot be accomplished within the 30-day period, either the provider or the health plan may initiate an Independent Dispute Resolution (IDR) within 4 days of the negotiation period’s conclusion. Ultimately, the IDR will render a final decision on the payment amount if the parties cannot come to agreement. IDR-determined payment will be issued to the provider within 30 days of the IDR decision.

Provider Billing and Good Faith Estimates

As noted under the NSA requirements, out-of-network providers are prohibited from balance billing patients for emergency services beyond the expected network cost-sharing amount as based on the QPA. Out-of-network providers delivering non-emergency services at an in-network facility may not balance bill patients beyond the expected in-network cost-sharing amount for these services.

Patients cannot be balance billed at an in-network facility when out-of-network providers provide ancillary or diagnostic services such as anesthesiology, radiology, neonatology or pathology, services by hospitalists, assistant surgeons and interventionists, or for services provided by out-of-network providers when an in-network provider is not available.

An exception is when the patient is given notice of the cost of the out-of-network care and provides written consent to receive the services at this cost, with the consent received within 72 hours of provision of the service. The provider must present a good faith estimate (GFE) for the cost of the services. The patient must also be given a list of in-network providers at the facility available to complete the services. Note that a GFE may be provided for self-pay or uninsured patients.

All providers must provide information on patient rights concerning balance billing as of January 1, 2022; this should be included on the practice’s website. There are potential civil monetary penalties for violation of the law and additional enforcement regulations are still under development.

NSA Transparency Requirements

The NSA also requires health plans to provide transparency on deductibles, out-of-pocket maximums, and in-network providers; which will be printed on the insurance identification cards.

If the provider sends a GFE to the health plan, an advanced explanation of benefits (AEOB) is provided to the patient. The AEOB has eight required elements and detailed timing requirements. See the CPT Assistant Bulletin for details on these provisions.

More Details to Come on No Surprises Act 2022

Anticipate additional NSA regulations to be released as more details emerge. As noted, the intent of the legislation is to give patients more information and tools regarding the cost of their medical services; and eliminate the possibility of receiving large medical bills for out-of-network services when they had no control over the provision of services by the out-of-network provider.

Medical practices must comply with transparency requirements and adjust workflow for processes such as creating GFE documentation, updating information for health plan directories and procedures for potential payment disputes with health plans, and the IDR process.

Additional details of the act will be published on the YES blog. Need assistance navigating the new transparency requirements of the No Surprises Act 2022? Contact YES’ qualified team of consultants today to discuss your organization’s tailored solutions.