Biden Administration Releases Surprise Billing Regulations

Several US departments, including HHS, have released much-anticipated surprise billing regulations to implement the No Surprises Act, a law passed last year that aims to protect patients from unexpected and oftentimes excessive out-of-network bills.

The regulations were issued as an interim final rule titled “Requirements Related to Surprise Billing; Part I.” The authors also included the Department of Labor, the Department of Treasury, and the Office of Personnel Management.

Among the rule’s provisions is a ban on surprise billing for emergency services and out-of-network cost-sharing higher than what a patient would pay in coinsurance and deductible for in-network care.

The rule also prohibits out-of-network charges for ancillary care at in-network facilities in all circumstances—an issue that most frequently results in surprise medical bills. Providers will also no longer be allowed to bill patients for out-of-network charges without advance notice.

The interim final rule will go into effect 60 days after it is published on the Federal Register. However, most surprise billing regulations will not be applicable until January 1, 2022. Stakeholders have 60 days to submit comments to the departments on the rule.

“No patient should forgo care for fear of surprise billing,” HHS Secretary Becerra, said publicly following the rule’s release. “Health insurance should offer patients peace of mind that they won't be saddled with unexpected costs. The Biden-Harris Administration remains committed to ensuring transparency and affordable care, and with this rule, Americans will get the assurance of no surprises.”

Notably missing from the interim final rule on surprise regulations though were details on the arbitration process outlined in the No Surprises Act. The law requires the establishment of independent dispute resolution (IDR) process that will enable payers and providers to resolve out-of-network charges that would otherwise be the responsibility of the patient through balance billing. The IDR is meant to determine the out-of-network rate that payers will reimburse providers for care at the center of a surprise medical bill.

Many states already have a similar arbitration process in place to address surprise medical bills, which include payment amounts, timelines, and processes under the process.

The interim final rule stated 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.

Healthcare provider groups have been generally accepting of the IDR process outlined in the No Surprises Act, saying it will ensure a fair solution compared to establishing out-of-network payment benchmarks as other legislation has proposed.

However, these groups are anxious to know more about the IDR process and how they will get paid for delivering necessary care when it is beyond a patient’s network.

Last month, the Federation of American Hospitals (FAH) provided several recommendations to HHS and other Cabinet Secretaries on how to implement the IDR process. Among its recommendations was that qualifying payment amounts that trigger the process do not become “de facto” benchmark prices payers use to reimburse providers less for surprise care. Instead, the group advised the Cabinet Secretaries to consider geographic area when determining qualifying payment amounts.

FAH also asked the Cabinet Secretaries to give providers enough time to understand and implement new policies and processes around surprise billing.

““[T]he No Surprises Act outlines an ambitious implementation timeline for numerous new policies and the creation of an entirely new dispute resolution process,” FAH wrote in the letter. “The myriad of implementation issues to consider and decisions to make – coupled with the potential impact of these policies on health plan/provider relationships and operations – means it is vital that your Departments provide ample opportunity for stakeholder input on any proposed regulations before they are implemented.”