On July 1, 2021, the U.S. Department of Health and Human Services (HHS), the Department of Labor, and the Department of the Treasury (collectively, the Departments), along with the Office of Personnel Management (OPM) released an interim final rule with comment period (“IFC” below), implementing portions of the No Surprises Act, which was enacted as part of the Consolidated Appropriations Act of 2021. Absent any change, this interim rule will become final on September 13, 2021 and will go into effect in 2022.
The No Surprises Act protects health plan members who receive emergency care from balance-billing aka “surprise billing” by out-of-network (OON) providers. Effective January 1, 2022 and applicable to group health plans and health insurance issuers for plan years beginning on or after that date, the No Surprises Act will cap a plan member’s cost-sharing obligations for OON services to the plan’s applicable in-network cost-sharing level for the following three categories of services:
1. Emergency services performed by an OON provider or facility and post-stabilization care if the patient cannot be moved to an in-network facility;
2. Non-emergency services performed by OON providers at in-network facilities, including hospitals, ambulatory surgical centers, labs, radiology facilities, and imaging centers; and
3. Air ambulance services provided by OON providers.
As noted by the HHS in their July 1 press release, “Researchers estimate that 1 of every 6 emergency room visits and inpatient hospital stays involve care from at least one out-of-network provider, resulting in surprise medical bills.”
For additional background on the No Surprises Act, please see our previous article on the subject.
General Provisions and Definitions
The rule (IFC) implements many of the law’s requirements for group health plans, health insurance issuers, health care providers and facilities, and air ambulance service providers. The rule clarifies that the No Surprises Act does not apply to retiree-only plans, excepted benefits, short-term limited-duration plans, Health Reimbursement Accounts (HRAs), flexible spending accounts (FSAs), or health savings accounts (HSAs). It also does not address the independent dispute resolution process for settling disputes between payers and providers -- regulations on that aspect of the No Surprises Act are expected in the next few months.)
If a plan or coverage provides or covers any benefits for emergency services, this IFC requires emergency services to be covered:
Emergency services include certain services in an emergency department of a hospital or an independent freestanding emergency department. It also includes post-stabilization services, unless all of the following conditions are met:
The IFC also defines “emergency medical condition” to be a medical condition manifesting itself by acute symptoms of sufficient severity (including severe pain) such that a prudent layperson with an average knowledge of health and medicine could reasonably expect to either (1) place their health in serious jeopardy, (2) seriously impar bodily functions, or (3) cause serious dysfunction to any bodily organ or part. The definition includes both mental health and substance use disorders. Plans must determine whether the standard has been met with a focus on the presenting symptoms, without imposing a time limit between onset of symptoms and presentation for emergency care, and without restricting coverage to instances of a “sudden onset” of the condition.
Determining Reimbursement Rates for OON Providers
The IFC provides that consumer cost-sharing amounts for emergency services provided by out-of-network emergency facilities and out-of-network providers, and certain non-emergency services furnished by out-of-network providers at certain in-network facilities, must be calculated based on one of the following amounts:
Similarly, cost-sharing amounts for air ambulance services provided by out-of-network providers must be calculated using the lesser of the billed charge or the plan’s or issuer’s qualifying payment amount, and the cost sharing requirement must be the same as if services were provided by an in-network air ambulance provider.
Limited Consent for Out-of-Network Rates
In limited cases, the IFC allows a provider or facility to provide notice to a patient regarding potential out-of-network care, and obtain the individual’s consent for that out-of-network care and extra costs. However, this exception does not apply to ancillary services, which include items and services related to emergency medicine, anesthesiology, pathology, radiology, and neonatology. It also does not apply to items and services provided by assistant surgeons, hospitalists, and intensivists; diagnostic services, including radiology and laboratory services; and items and services provided by a nonparticipating provider if there is no participating provider who can furnish such item or service at the facility. Finally, the notice and consent exception does not apply to items or services furnished as a result of unforeseen, urgent medical needs that arise at the time an item or service is furnished for which a nonparticipating provider satisfied the notice and consent criteria.
Notice to Consumers
The IFC also requires certain health care providers and facilities to make publicly available, post on a public website, and provide to individuals a one-page notice about:
As mentioned above, the IFC is generally applicable to group health plans and health insurance issuers for plan and policy years beginning on or after January 1, 2022. The regulations that apply to health care providers, facilities, and providers of air ambulance services are applicable beginning on January 1, 2022.
The following links will be helpful to those seeking more information:
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