No Surprises Impacts All Physicians in 2022

The “No Surprises” Act impacts all physicians in 2022! Obviously, there are big changes for out-of-network (OON) billing. But all practices and departments need to get ready quickly as these requirements go into effect January 1, 2022:

  • All providers, even those fully in-network, must publish and publicize information about the No Surprises Act.
  • Almost all out-of-network billing reimbursement and patient billing will be required to change. 
  • Any referrals or scheduled procedures for self-pay or uninsured patients will require a good-faith cost estimate.
  • Billing must consider state as well as federal “No Surprises” legislation.

Setting aside the current debate about how disputes should be settled (see “No Surprises” Act, Physicians Lose), here is why the No Surprises Impacts all Physicians, starting in January. 

First, we should note that the federal No Surprises rules apply to

  • All out-of-network emergency services,
    • Including post-stabilization care at out-of-network facilities until a patient can be safely transferred to a different facility,
  • All air ambulance transports, 
  • All non-emergency out-of-network services delivered at or ordered from an in-network facility, unless the provider follows the notice and consent process.
    • All care during such a visit by any provider is limited to in-network cost sharing, unless notice and consent criteria are met (see below).

In other words, the new rules apply to the vast majority of OON billing situations. The only exception appears to be services delivered at an OON facility. 

It’s also worth noting that payers can no longer second-guess payment for emergency treatment. Emergency services are required to be covered

  • Without prior authorization.
  • Regardless of whether the provider is an in-network provider or an in-network emergency facility.
  • Without limiting what constitutes an emergency medical condition solely on the basis of diagnosis codes.

Publish No Surprises Act Information

The first way that No Surprises Impacts all Physicians is that all providers are required to post a one-page notice with “information in clear and understandable language” on:

  1. The restrictions on providers and facilities regarding balance billing,
  2. Any applicable state law protections against balance billing, and
  3. How to contact appropriate state and federal agencies when an individual believes that a provider or facility has violated the restrictions against balance billing.

A model notice that providers can use, if they wish, is available from CMS here.

Out of Network Billing: Adding Complexity for Providers

According to Experian Health, 

“Creating a “no surprises” billing experience will require payers and providers to make major process changes. Roger Johnson, VP of Payer Solutions at Experian Health, says, “The new regulations require the industry to innovate significantly in a very short timeframe. Determining network status is a huge challenge for providers, as is engaging patients electronically pre-service. There will also be challenges in tracking and submitting consent forms, producing Good Faith Estimates, applying appropriate cost-sharing, billing, payment reconciliation, and the new dispute resolution process.”

One major challenge for physician billing will be determining the patient portion to be billed. Fortunately, much of the information needed for the patient portion is supposed to be provided on updated insurance cards.

  • The No Surprises Act requires plans to include applicable deductibles, out-of-pocket maximums and contact information on physical or electronic ID cards. However, CMS has not issues specific rules for this requirement and they aren’t expected until next year.
  • In the meantime, payers are required to use “methods that are reasonably designed and implemented” to provide the required information to all of their customers. CMS will consider
    • Is each specific data element on the card?
    • Are required data elements not included on the face of an ID card made available through information provided on the ID card?
    • What mode is used to provide information absent from the card?

As a result, in many cases, it may be possible to determine the patient responsible amount and issue a bill. For non-emergency situations, these amounts could potentially be collected in advance.

Of course, the larger issue is the amount that can be collected from the payer (insurance company). This is where controversy exists (see “No Surprises” Act, Physicians Lose). Under current rules, the OON payment rate is

  • Any State law or All-Payer Model Agreement mandated rate, 
  • The amount agreed by the parties or 
  • The lesser of the billed amount or the Qualified Payment Amount (QPA), unless the payer decides to pay a different amount.

The QPA is defined as the median of the contracted rates recognized by the health plan on January 31, 2019 for the same or similar item or service provided by a similar provider in the same geographic region, and indexed for inflation. That amount is to be paid within 30 days of receiving the bill.

As a result, while the physician can bill at a “normal” OON rate, the expected payment will typically be much lower. After an initial payment is received, the provider, if dissatisfied, can initiate a negotiation, starting a 30-day clock for the provider and insurer to settle. 

If there is no agreement after 30 days, the parties enter a “final offer” arbitration. Both sides submit their best offer and an arbitrator picks one. This is the “Independent Dispute Resolution (IDR)” process. 

If a provider starts the IDR process, both the provider and the health plan will submit a proposed payment to a CMS-approved arbitrator, along with information on the following factors:

  • The calculated QPA
  • The provider’s training and experience
  • The complexity of the procedure or medical decision-making
  • The patient’s acuity
  • The market share of the health plan, and the provider
  • Whether the care was provided at a teaching facility
  • The scope of services
  • Any demonstration of good faith efforts to agree on a payment amount; and
  • The contracted rates from the prior year

The arbitrator will then choose one of the two proposals as the amount of the payment. Under the current regulations, the arbitrator cannot come up with his or her own payment amount. Arbitrators are paid through fees assessed to the entities that use the IDR process.

Obviously, this is an onerous and expensive process, even it is undertaken to deal with multiple situations and payments (which appears to be possible though those procedures are not defined). The risk to OON providers (and the source of most of the recent controversy) is that the current No Surprises Interim Final Rules tell the arbitrator that the Qualified Payment Amount (QPA) is the most appropriate rate to consider!

Notice and Consent for OON Services and Billing

There is an exception for patients who wish to voluntarily use an out-of-network provider when a “substantive choice” exists. In this case, an OON provider must notify a patient of its OON status and get the patient’s written consent to receive OON services, at OON rates, at least 72 hours prior to the services, or 3 hours before for a same-day appointment. The consent form must indicate

  • Whether pre-authorization is required,
  • What in-network providers are available, and 
  • A good-faith cost estimate for the total bills for the proposed out-of-network care

While detailed rules on the consent process have not been published, it appears that OON consent can be on a provider-by-provider, or service-by-service basis. In the case where a service involves a number of OON providers, consent must be obtained for each. Or, if obtained on a service basis, the good-faith cost estimate must encompass all OON providers. 

Good Faith Estimates for Self-Pay and Uninsured

Starting in January, a provider must give an uninsured (or self-pay) patient a good faith estimate of expected charges after an item or service is scheduled, or upon request. Note that this is another case where the No Surprises Impacts all Physicians! This requirement applies to all providers and health care facilities, whether in network or not. In other words, every healthcare provider must be prepared to provide the good faith estimate upon request of any uninsured or self-pay patient, including those who choose to have a procedure done without submitting it to their insurance.

Here are the specific requirements:

  • Within 1 business day after scheduling (when service is scheduled at least 3 business days before the patient is seen) or 
  • No later than 3 business days after scheduling (when service is scheduled at least 10 business days before delivery), depending on scheduling; or
  • Within 3 business days after an uninsured (or self-pay) consumer requests a good faith estimate.

The good faith estimate should use clear and understandable language and include an itemized list of each item or service, grouped by provider or facility. Each item or service is to have details and the expected charge. A paper or electronic copy is to be provided, even if the information is communicated on the phone or verbally in-person.

For more, review our references for out of network billing.