In the latest COVID-19 relief effort, the Consolidated Appropriations Act, 2021 was passed at the end of 2020. In the Act, Congress included a legislative solution (the “No Surprises Act”) designed to end “surprise billing” for those patients who receive unexpected medical bills, sometimes for tens of thousands of dollars, from out-of-network medical providers, doctors and air ambulance services. The issue of surprise medical bills has been especially relevant during the COVID-19 pandemic, which has increased the occurrence of surprise bills at a time when people are struggling with unexpected medical and other costs.
The Act will generally be effective in 2022 on a prospective basis and will apply to fully-insured plans and self-funded plans. Many of the Act’s requirements will be dependent on more clarity that will be provided through the Federal rulemaking process, which will begin by July of 2021. As further details emerge, we will provide updates accordingly.
Below is a summary of the headlines of the No Surprises Act.
Payment Dispute Resolution
State Laws May Create Confusion
More than 30 states have enacted some type of surprise billing protections, but only 17 are considered comprehensive (including New Jersey and New York, for example). However, the effect of these state laws is limited as they do not apply to self-insured employers. Given the No Surprises Act, state lawmakers may eventually alter their legislation or adopt new proposals to avoid confusion between self-funded employers and fully insured plans subject to state law.
While the No Surprises Act has been praised by patient advocacy groups, the full effects of the new rules on patients’ access to and quality of care, and health care costs more generally, will need to be evaluated over time. There has long been agreement on the importance of the protections, but there remain concerns about the burden on all parties. The American Hospital Association released a letter detailing the “unworkable” billing processes and the “duplicative and costly” transparency provisions. Likewise, the American Medical Association and the Association of American Physicians & Surgeons also voiced concerns, noting the complexity of the IDR process and calling the Act “a surprise attack on patients’ access to independent physicians.”
The payment resolution process and numerous reporting requirements included in the Act offer many opportunities for implementation concerns which will need to be addressed by the incoming administration. Regulation and guidance will be needed to guide the yet to be identified eligible arbitrators’ decisions and to help ensure that arbitration will work fairly. We expect more clarity as the Federal rulemaking process begins later in July of 2021. We will provide updates as further details emerge. Please contact your Conner Strong & Buckelew account representative toll-free at 1-877-861-3220 with any questions. For a complete list of Legislative Updates issued by Conner Strong & Buckelew, visit our online Resource Center.