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  • Washington Highlights

    No Surprises Act Final Rules Modify Independent Dispute Resolution Process, Make Other Changes


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

    The Departments of Health and Human Services, Labor, and Treasury released final surprise billing rules on Aug. 19 updating key provisions in regulations pertaining to the No Surprises Act (P.L. 116-260), which protects patients from out-of-network medical bills when receiving care at in-network facilities. These regulations include modifications to interim final regulations released in 2021 pertaining to what independent dispute resolution (IDR) entities must consider when making a determination about the payment amount for the out-of-network services [refer to Washington Highlights Dec. 10, 2021].

    The interim final rules had instructed the IDR entities to begin with a presumption that the offer closest to the ”qualifying payment amount (QPA), which is the payer’s median contracted rate, was the appropriate out-of-network payment amount. Provider groups, including the AAMC, opposed the use of the QPA as the primary factor in making the decision, arguing that other factors (e.g., teaching status, patient acuity, case mix, and scope of services of the facility providing the care) should be considered equally [refer to Washington Highlights, Dec. 10, 2021]. Notably, the Texas Medical Association challenged the presumption regarding the QPA in the U.S. District Court for the Eastern District of Texas, and the court vacated the requirement that the arbiters select the payment offer closest to the QPA [refer to Washington Highlights, Feb. 25]. Additionally, the American Hospital Association and the American Medical Association filed a lawsuit challenging this provision, with the AAMC filing an amicus brief supporting their position, in the U.S. District Court for the District of Columbia [refer to Washington Highlights, Dec. 17, 2021].

    As a result, this rule states, “These final rules do not require the certified IDR entity to select the offer closest to the QPA. Rather, these final rules specify that certified IDR entities should select the offer that best represents the value of the item or service under dispute after considering the QPA and all permissible information submitted by the parties.” This final rule also addresses situations where payers have “downcoded” a claim by changing service codes or changing, adding, or removing a modifier.

    The departments also issued a new set of frequently asked questions providing guidance on several requirements of the No Surprises Act, including protections that apply to no-network and closed-network plans, the calculation of the qualifying payment amount, and disclosure requirements. The departments also provided a status update on the federal IDR process, including how many disputes have been submitted through the process. To address challenges with the process,  new information was posted on the Centers for Medicare & Medicaid Services (CMS) No Surprises Act website that detailed common mistakes and helpful tips for initiating IDR disputes. The CMS also rolled out new functionality in the portal for initiating disputes that allows immediate access to documents provided by initiating parties that support their disputes.