On July 1, the Biden administration released part 1 of the No Surprises Act interim final rule. Passed as part of the Consolidated Appropriations Act of 2021, the rule establishes new patient protections from balanced billing and excessive cost-sharing, known as surprise billing.
The rule was released by the departments of Health and Human Services (HHS), the Treasury, and Labor and the Office of Personnel Management. It bars health care insurers, carriers, and providers from billing patients more than in-network cost-sharing amounts in certain circumstances. The rule addresses several provisions in the law, including:
- the ban on balance billing for certain out-of-network services;
- the notice-and-consent process;
- how patient cost-sharing must be calculated; and
- a complaint process for potential violations.
The ban on surprise billing applies to emergency services, air ambulance services provided by out-of-network providers, and non-emergency services provided by out-of-network providers at in-network facilities in certain circumstances.
Details of the Rule
Emergency Services
Under this interim final rule, emergency services include those in an emergency department of a hospital or an independent freestanding emergency department, as well as post-stabilization services in certain instances. The rule provides a detailed definition of emergency and post-stabilization services. If a plan provides benefits for emergency services, this rule requires emergency services to be covered regardless of:
- prior authorization;
- whether the provider is in-network or at an in-network emergency facility; and
- terms or conditions of the coverage other than the exclusion or coordination of benefits, or a permitted affiliation or waiting period.
Methodology
The rule largely adopts the No Surprises Act statutory language on cost-sharing for emergency services provided at out-of-network emergency facilities and for non-emergency services provided by out-of-network providers at an in-network facility. Cost-sharing for these services will be equal to the “recognized amount” for such services, based on an amount determined under specific state law or the lesser of the billed charge or qualifying payment amount (QPA). The rule defines the methodology for calculating the QPA and outlines information the payer must disclose regarding the QPA.
Notice-and-Consent Requirements
This rule also outlines specific notice-and-consent requirements that, if met, allow balanced billing. Requirements are related to the content, method, and timing of notice-and-consent communications; language access; exceptions; and payer notification regarding patient consent.
Next Steps
The departments will issue No Surprises Act regulations in several phases. The second regulation is expected to publish by Oct. 1 and will establish a payer audit process. The third regulation should be published by Dec. 27 and will detail the independent resolution dispute process and patient transparency provisions.
America’s Essential Hospitals is analyzing the interim final rule for comment and will send members a detailed Action Update in the coming days. Stakeholders will have 60 days to comment on the rule once published in the Federal Register.
Contact Senior Director of Policy Erin O’Malley at eomalley@essentialhospitals.org or 202.585.0127 with questions.
