HHS Proposes More Surprise Billing Compliance Rules

HHS and other federal departments have released a notice of proposed rulemaking (NPRM) that would impose civil monetary penalties of up to $10,000 on providers and facilities with surprise billing compliance issues. The rule would be part of regulations enforcing the No Surprises Act, a recent law prohibiting surprise medical bills.

The NPRM titled “Reporting Requirements Regarding Air Ambulance Services, Agent and Broker Disclosures, and Provider Enforcement” seeks to codify existing penalties in the Public Health Service (PHS) Act for violations of Part E of title XXVII.

The PHS Act authorizes HHS to impose civil monetary penalties to enforce individual and group market requirements in Part A and D of Title XXVII of the Act. The provisions apply to health insurance issuers specifically when a state fails to “substantially enforce” applicable PHS Act requirements. However, the No Surprises Act added a section to the PHS Act establishing a similar framework for enforcement authority over providers, facilities, and providers of air ambulance services, the NPRM explained.

If finalized, HHS could consider all relevant documentation from a complainant and the provider or facility. It would also determine the amount of the penalty based on “the nature of claims of noncompliance and the circumstances under which such claims were presented,” among other factors, such as medical bills, claims, and notice and consent forms.

The civil monetary penalty could be brought up within six years of when a violation occurred, a claim was created, or a payment request was made, the NPRM stated.

Air ambulance providers would also face another penalty of up to $10,000 under the Social Security Act for failure to submit data required under the No Surprises Act. The NPRM states that the data includes information on transportation and medical costs, air ambulance bases and aircraft, the number of and nature of air ambulance transports, payer data, and claim denials.

The data will be summarized in a public report released by HHS and the Department of Transportation on the air ambulance market.

“The air ambulance industry is a highly consolidated market that often leads to surprise bills for patients,” HHS Secretary Xavier Becerra said in an announcement on Friday. “Today's proposed rules are part of the Biden-Harris Administration's agenda to protect patients from unreasonably high costs and make health care more affordable. These rules would allow HHS to collect data to analyze the industry's market trends and costs and provide critical information that will address exorbitant air ambulance expenses.”

The NPRM also clarifies how the federal government plans to address state laws when implementing the No Surprises Act.

A federal rule released by HHS and other federal departments seeking to detail execution of the No Surprises Act made clear that “the Departments are of the view that Congress did not intend for the No Surprises Act to preempt provisions in state balance billing laws that address issues beyond how to calculate the cost-sharing amount and out-of-network rate.”

“To the extent state laws do not prevent the application of a federal requirement or prohibition on balance billing, the Departments are of the view that such state laws are consistent with the statutory framework of the No Surprises Act and would not be preempted,” the rule continued.

The NPRM details the process that HHS would take to determine if states are “substantially enforcing new surprise billing and other consumer protections.”

“These proposed rules would ensure CMS can take action against providers and facilities to further protect consumers from surprise bills in states that fail to substantially enforce these requirements,” HHS stated in the announcement.

CMS Administrator Chiquita Brooks-LaSure said on Friday, “No one should avoid seeking [healthcare] for fear of receiving a surprise medical bill. The new consumer protections released today are critical to shielding consumers from the devastating financial impacts that may occur as a result of an unlawful surprise bill, and CMS is committed to vigorous enforcement of these protections."

In addition to provider enforcement of the No Surprises Act, the NPRM would also “further increase transparency by requiring certain health insurance issuers to inform consumers of how agents or brokers who assist consumers with enrollment in individual health insurance coverage and short-term, limited-duration insurance are compensated, including both direct and indirect compensation provided for such enrollment,” according to the announcement.

The NPRM also said the departments plan to issue more regulation specifically around the independent dispute resolution process of the No Surprises Act. The Act goes into effect January 1, 2022.