On Dec. 27, 2020, The Consolidated Appropriations Act of 2021 was signed into law by President Trump. This large piece of legislation includes the No Surprises Act, which generally requires health plans to pay providers emergency and other out-of-network charges that normally would have been balance-billed to participants.
The No Surprises Act applies to fully-insured and self-insured group health plans, and covers out-of-network emergency claims and out-of-network claims provided at in-network hospitals and other facilities (such as labs, imagining or anesthesia). It also includes air ambulance charges if the plan otherwise covers in-network air ambulance benefits.
Basically, the act limits the participant’s out of pocket expenses (copays, deductibles, coinsurance) to what they would have been had the claims had been incurred in-network.
Under this act, the plan must make an initial payment or send a notice of denial of payment to the provider within 30 days after the bill or claim is received. If they cannot reach an agreement, they have four days to initiate a binding arbitration process called an independent dispute resolution (IDR). With the IDR process, each party submits a payment amount offer with supporting evidence, and the certified IDR entity chooses one of the amounts.
The IDR entity could not choose an amount not offered by either party, but will consider the median in-network rate when considering both offers, which is the median amount of what all plans would charge for the same service in that geographic region. The losing party must accept that amount and must also pay all arbitration costs. However, for fully-insured plans, states may set payment standards or dispute resolution processes.
For any non-emergency claims incurred with out-of-network providers at an in-network facility, the plan must cover these types of services under requirements similar to the emergency services requirements described previously. The participant is only required to pay the in-network cost for out-of-network charge provided at in-network facilities, unless the out-of-network provider notifies the patient of its status and estimated charges 72 hours before receiving the out-of-network services, and the patient consents. Only then could an out-of-network provider balance-bill a participant.
Subsequent regulations from the Departments are forthcoming, which will provide more details. Plans years beginning on or after January 1, 2022 are required to comply, so now is the time to discuss with your carrier or claims payment administrators.
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