Medicare Compliance & Reimbursement

Weigh in on the changes before the deadline.

If you’re reworking your billing protocols, you may want to single out your balance billing policies for an overhaul in light of a new rule. The feds offer clarity and promises of future rulemaking on the challenging issue in a recent release. Read on for the details.

Then: Last December, Congress passed the Consolidated Appropriations Act, 2021, a massive COVID-19 relief bill, that included other healthcare-related provisions (see Medicare Compliance & Reimbursement, Vol. 47, No. 1). The No Surprises Act, which was sandwiched in the 5,593 pages of legislation, aimed to tackle the longstanding problem of surprise billing in healthcare.

Now: On July 13, the Departments of Health and Human Services (HHS), Labor, and Treasury, in tandem with the Office of Personnel Management (OPM) and the Centers for Medicare & Medicaid Services (CMS), published a collaborative interim final rule with comment period (IFC), the “Requirements Related to Surprise Billing: Part I,” in the Federal Register. The interim rule “establishes new protections from surprise billing and excessive cost-sharing for consumers receiving health care items and services,” explains CMS in a fact sheet.

Impacted parties should anticipate more updates since this release claims to be just the first of many reforms, points out attorney Jeffery I. Davis with law firm Baker Donelson. “The ban on balance billing goes into effect January 1, 2022, and the IFC is the first of several sets of regulations expected before the end of the year to implement the No Surprises Act,” Davis says in online analysis.

“In addition to the prohibitions on balance billing, the No Surprises Act also outlines a framework for payers and [out of network] OON providers to settle disputes over payment rates through an independent dispute resolution (IDR) process,” Davis adds.

Understand What Surprise or Balance Billing Entails

“Surprise billing happens in emergency and non-emergency care,” CMS says. Surprise billing, which is also referred to as balance billing, generally occurs when a patient receives care expecting an in-network rate or by in-network clinicians, but instead the physician or facility is actually out of network. The provider then bills the patient directly, leading to a bill higher than the patient anticipated due to the misunderstanding about in-network status.

Though this most frequently happens in emergencies, receiving care from a physician who’s out of the patient’s health plan’s network can also lead to balance bills. In fact, the problem has become so prevalent that the national media sometimes picks up stories about patients who receive astronomical, unanticipated bills for care they believed that their health insurance would cover. And that’s where the No Surprises Act and subsequent provisions come into play.

Don’t Forget About the ACA

The No Surprises Act and the IFC also connect with provisions originally laid out in the Affordable Care Act (ACA), too.

“The No Surprises Act builds on the consumer protections established by the ACA by prohibiting balance billing in many situations and limiting out-of-network cost sharing in comment situations where surprise bills often arise,” reminds attorney Noreen Vergara with law firm Husch Blackwell LLP in online analysis. “Included within the scope of this Act and Rule are group health plans, health insurance issuers, carriers under the Federal Employees Health Benefits (FEHB) Program, healthcare providers and facilities, and air ambulance providers.”

Know These 4 Top Takeaways

The IFC is chock full of policy developments and changes. Here are four critical updates to know:

1. Emergency services: “Emergency services [are] to be covered without any prior authorization, without regard to whether the health care provider furnishing the emergency services is a participating provider or a participating emergency facility with respect to the services, and without regard to any other term or condition of the plan or coverage other than the exclusion or coordination of benefits or a permitted affiliation or waiting period,” the IFC states.

The IFC also redefines emergency services. “Emergency services include certain services in an emergency department of a hospital or an independent freestanding emergency department,” CMS says in the fact sheet. This would also include “urgent care centers permitted by state licensing laws to provide emergency services,” points out attorney Lauren M. Moldawer with law firm Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. in online analysis. “HHS, however, specifically requested comments on the inclusion of urgent care centers as providers of emergency services.”

The rule “also specifically clarifies that health plans cannot deny emergency services based solely on a diagnosis, which HHS notes is occurring with some regularity,” Moldawer says.

2. Bans: The rule follows through on balance billing bans mentioned in the No Surprises Act. “The IFC codifies in regulation the No Surprises Act’s ban on balanced billing for emergency services, non-emergency services furnished by a nonparticipating provider at a participating health care facility, and OON air ambulance services,” Davis relates. “The IFC also codifies a prohibition on patient cost-sharing that exceeds in-network levels,” he says.

3. Cost-sharing: “Generally, items or services covered by the scope of the Act or Rule which are performed by an out-of-network provider must not be greater than the amount that would apply if such items or services were provided by an in-network provider or facility,” Vergara explains.

The IFC mandates three methodologies on how insurers should calculate patients’ costs. They include the following, according to the IFC:

• An amount determined by an applicable All-Payer Model Agreement under section 1115A of the Social Security Act;
• If there is no such applicable All-Payer Model Agreement, an amount determined under a specified state law; and
• If neither of the above apply, the lesser amount of either the billed charge or the qualifying payment amount, which is generally the plan’s or issuer’s median contracted rate.

4. Disclosures: “Certain” facilities and providers must notify patients about the regulations and prohibitions in the No Surprises Act. They can do this publicly in the office, via a public website, or with a one-page notice. In addition, the provider must also disclose any applicable state balance billing limitations or prohibitions and offer contact information for both state and federal agencies to report violations to.

“HHS has created a model notice that providers and facilities could use to ensure compliance with the notification requirements,” Davis says.

Deadline: The federal agencies are accepting public comments on the rule through Sept. 7.

Bottom line: “Health insurance should offer patients peace of mind that they won’t be saddled with unexpected costs,” says HHS Secretary Xavier Becerra, in a release on the rule. “The Biden-Harris Administration remains committed to ensuring transparency and affordable care, and with this rule, Americans will get the assurance of no surprises.”

Resource: Review the rule in the Federal Register and comment at www.federalregister.gov/documents/2021/07/13/2021-14379/requirements-related-to-surprise-billing-part-i.