On July 1, 2021, the Biden Administration passed an interim final rule: Part 1 of the "Requirements Related to Surprise Billing Act," in an attempt to curb excessive costs patients are required to pay in relation to surprise billing. The rule is set to take affect January 1, 2022, and will only affect those who are enrolled in insurance via their employers, as federal healthcare programs already prohibit this type of billing.1
Surprise billing occurs when patients receive care from out-of-network providers without their knowledge. This results in higher prices for medical services that would otherwise be cheaper if rendered by providers inside their health plan's network, resulting in the patient being responsible to cover what was not covered by their insurance. According to CMS, in 2016, 42.8% of emergency room visit bills were subject to an out-of-network bill, even though the visit was to an in-network hospital.2 While some may believe this only occurs in emergency situations, it can also occur in non-emergency situations as well (i.e., someone involved in the patient's care is not in-network).
In addition to cutting down these surprise costs, the rule is also focused on the following:
- No longer allowing surprise billing in emergencies;
- Banning high cost-sharing for both emergency and non-emergency services (i.e., cost-sharing cannot be higher for out-of-network services than in-network cost-sharing);
- Banning out-of-network charges for ancillary care;
- Banning out-of-network charges without notice in advance (providing patients plain-language consumer notice).3
Requiring out-of-network providers to provide potential patients with notice that they are outside of the patient's health plan's network is a large part of the No Surprises Act's purpose. Essentially, patients can waive paying out-of-network prices for non-emergency services so long as they consent, something that is not permitted in emergency situations or for certain ancillary services (i.e., anesthesia) under the Act.4
First, providers and/or health facilities are expected to have a standard notice that can be given to out-of-network patients when they seek services, which must be given to patients within seventy-hours of the scheduled appointment or service (or three hours for same-day-services). These notices should include the following:
- A statement that the provider (or facility) is out-of-network;
- An estimate of the cost of services (which must be calculated in good faith); and
- Information on prior authorization/utilization management limitations.5
This document must be given to the patient separate from any other documents given to them, and must be available in fifteen (15) of the most common languages where the provider is located (in addition to adherence to language requirements as required by state and federal law).6
Additionally, if the notice is given for post-stabilization services, the notice must also include a list of in-network providers that can provide the needed services, and a statement that the patient will be referred to an in-network provider at the patient's discretion.7
Lastly, there is a requirement which states that out-of-network providers must notify health plans when they provide a patient services, and they must certify that they have met the required notice and consent requirements. These records must be kept for a minimum ofseven years either by the provider or the health facility.8
The Department of Health and Human Services ("HHS") is expected to offer additional guidance as the effective date of the Act nears, so stay tuned for more out-of-network provider requirements regarding consumer notice and consent.
1 CMS, What You Need to Know about the Biden-Harris Administration's Actions to Prevent Surprise Billing, (July 1, 2021), https://www.cms.gov/newsroom/fact-sheets/what-you-need-know-about-biden-harris-administrations-actions-prevent-surprise-billing
2 CMS, Requirements Related to Surprise Billing; Part I Interim Final Rule with Comment Period (July 1, 2021), https://www.cms.gov/newsroom/fact-sheets/requirements-related-surprise-billing-part-i-interim-final-rule-comment-period
3 CMS, HHS Announces Rule to Protect Consumers from Surprise Medical Bills, (July 1, 2021), https://www.cms.gov/newsroom/press-releases/hhs-announces-rule-protect-consumers-surprise-medical-bills
4 AHA, Agencies Issue Part One of Regulations Banning Surprise Medical Bill (July 2, 2021), https://www.aha.org/special-bulletin/2021-07-02-agencies-issue-part-one-regulations-banning-surprise-medical-bills.
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