New Surprise Billing Arbitration Guidance May Give Docs More Wiggle Room

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Last week, CMS updated guidance on the heavily disputed aspects of an arbitration process for resolving payment disagreements between insurers and providers under the No Surprises Act.

The updates to this guidance were made in response to a Texas ruling that compelled HHS to change how dispute resolution entities would approach the pricing benchmark known as the “qualifying payment amount” (QPA), the median rate of the given service in-network contracted by the insurer.

“It does, to me, seem very consistent with the statute, which is, you start with a QPA and then you look at everything else,” Katie Keith, of the O’Neill Institute for National and Global Health Law at Georgetown University Law Center, told MedPage Today.

The regulatory agencies “pulled down the manuals that they had and then had to rewrite the sections because of this,” Keith explained. “And basically, this guidance is the result of that.”

However, the guidance isn’t final, and the regulatory agencies must still issue a final rule that will outline the dispute resolution process under the No Surprises Act.

Language in the original interim rule included a “rebuttable presumption” that the QPA was the appropriate payment, unless there was convincing evidence to the contrary. According to the updated guidelines, there is no such presumption. Along with the QPA, independent dispute resolution entities will consider additional information that providers submit — factors that could boost their out-of-network payment from insurers, since they can no longer “surprise bill” patients.

This additional information includes the relevant history of the provider or facility — their level of training and experience, quality and outcomes measurements, the market share of the service provided, patient “acuity” or the complexity of the service, the teaching status and scope of services offered, any record of an effort to enter into a network agreement with the insurer, and the historical contracted rates with the insurer or plan.

While the original regulatory language directed arbitrators to choose between two proposed payments — the one closest to the QPA, unless there was enough evidence to show the other offer was appropriate — the revised language in the CMS guidance places less emphasis on choosing between two offers, Keith noted.

“This just says, ‘we’re not going to direct you on which offer to pick over the other, but we can provide a little bit more detail on how we think you should consider the information,'” she explained.

Physician groups, including the Texas Medical Association, sued HHS and the other regulatory agencies who wrote the interim final rule for the No Surprises Act in October of last year. They argued that their interpretation of the law included parts that were too different from the law’s original arbitration framework. They and other groups claimed it unfairly favored the insurer-calculated QPA over all other factors — potentially putting hospitals and providers at a disadvantage.

A federal judge in Texas ruled in favor of the Texas Medical Association in February, vacating the interim final rule in a nationwide vacatur.

The regulatory agencies “had their rules in place,” said Keith. “The court set them aside, and then that sort of created a void. This guidance fills that void.”

In response to a request for comment from MedPage Today, a Texas Medical Association representative declined due to the ongoing litigation.

In a memo from late February, HHS announced that they would be revising the No Surprises Act arbitration guidance in accordance with the decision, presumably rewording the language on how arbitrators should consider factors that could make a medical procedure or service a different price than the QPA.

“It’s been pretty disruptive,” Keith added. “The government tried to avoid an outcome that was as destabilizing as this has been.”

Of note, these changes will not apply to disputes over air ambulance payments, reinforcing the Association of Air Medical Services’ fight to win their own legal challenge to the rule in the U.S. District Court for Washington, D.C., Keith noted. “The air ambulance companies ran to court immediately to be like, ‘see, this is why we’re still harmed.’ That’s how fun things are in court.”

Late last week, HHS launched an online portal for out-of-network providers and insurers to begin the dispute process when they cannot agree on a payment for services. Regulatory agencies have said they will issue a final rule in the early summer.

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    Sophie Putka is an enterprise and investigative writer for MedPage Today. Her work has appeared in the Wall Street Journal, Discover, Business Insider, Inverse, Cannabis Wire, and more. She joined MedPage Today in August of 2021. Follow

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