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  • Washington Highlights

    AAMC Submits Comments on Implementation of the No Surprises Act


    Mary Mullaney, Director, Hospital Payment Policies
    Gayle Lee, Director, Physician Payment & Quality

    The AAMC submitted comments on May 7 for inclusion in the forthcoming proposed rule(s) on implementation of the No Surprises Act, part of the Consolidated Appropriations Act, 2021 (P.L. 116-260), to the Department of Health and Human Services, Department of Labor and the Department of Treasury.

    The legislation limits patient’s out-of-network costs for emergency medical care furnished by out-of-network facilities and in certain situations where out-of-network providers deliver care to patients at in-network facilities. AAMC’s letter outlines the unique role teaching hospitals play in the health care system and offers recommendations the Departments should consider as they undertake rulemaking.

    The letter raises concerns with the tight implementation timeline and urges the Departments to consider delaying implementation to provide sufficient time to implement many of the system changes that providers and insurers will have to make to allow for a seamless transition.

    It also points out that it is vitally important that the regulations implementing the No Surprises Act address the complexity of services provided, and populations treated by teaching hospitals and teaching physicians.

    The letter emphasized that teaching hospitals and their associated providers “deliver highly specialized items and services that are often unavailable at other institutions.” The letter states that most insurers, including Medicare and Medicaid, recognize the important role and value that teaching hospitals and teaching physicians play in the health care system and the need for higher reimbursement at these facilities to ensure specialty and sub-specialized care provided is maintained. The letter asks that these higher rates be considered when calculating payment rates under the provisions in the legislation.

    Many states have enacted laws to prevent balance billing and the No Surprises Act defers to state law where applicable. The letter asks the agencies to clarify when state or federal laws apply. The legislation also establishes an independent dispute resolution (IDR) process to resolve disputes about payments between health care providers and insurers. The AAMC notes in the letter that it is crucial for the Departments to establish rules that ensure that the IDR process is fair, unbiased, and results in appropriate payment amounts for out-of-network providers.

    Finally, the No Surprises Act will require providers to produce a good faith estimate of the charges that are expected for scheduled services furnished to patients. The good faith estimate must be sent to the patient’s insurance company who will issue an Advanced Explanation of Benefits based on the estimate.

    The letter asks that the good faith estimate requirements align with the current hospital price transparency requirements and that the regulations clarify that good faith estimates are required only for items and services provided at the time of the scheduled service and only for services that the provider is responsible for directly billing to the plan.