Important SMB Status Update: Key Recommendations Sent to Federal Agencies Implementing the No Surprises Act

The Regs & Eggs blog post from a few weeks ago focused on ACEP’s regulatory advocacy strategy for the implementation of the No Surprises Act—a law enacted at the end of last year which addresses surprise medical billing (SMB). In the post, I stated how ACEP had teamed up with the Emergency Department Practice Management Association (EDPMA) to form a joint task force that represented the whole house of emergency medicine (EM). I also promised to give you an update on the EM SMB Implementation Task Force’s work—and I try never to break a promise!

So, here’s the update! Members of the Task Force worked extremely hard and came up with key insights on a host of complex policy issues. Based on this feedback, ACEP and EDPMA crafted a letter that includes our major initial recommendations—and, last week, we sent the letter to federal agencies that are implementing the law. The letter focuses on those issues that are expected to be included in the first round of regulations and also provides a comprehensive view of all points that have unique and significant implications for emergency care. It is broken out into six sections, and while I won’t go into detail on all the issues laid in the 19-page letter, here are some highlights:

1.  Overview and Perspective: Unique aspects of emergency care

• Existing Laws on Emergency Care Should Remain in Effect Unchanged: The process of providing emergency care includes requirements that are substantially different than other health care Federal laws and provisions such as the Emergency Medical Treatment and Labor Act (EMTALA), the Prudent Layperson Standard, and others should remain in full force and effect.
• Treatment of Downgraded Claims: There are specific administrative and legal processes currently in place to adjudicate downgraded claims or other disputes about the levels and/or types of services included on a claim. It is vitally important that these existing processes are NOT affected by the new No Surprises Act

2.  Important Definitions

• Qualifying Payment Amount: The “qualifying payment amount” as defined in the No Surprises Act, is based off the median contracted rate recognized by a health plan in 2019 and updated annually by a specific inflationary formula. The letter includes various recommendations for what data health plans should and should not use when calculating their median contracted rates.
• Recognized Amount: The “recognized amount” is used to determine a patient’s cost-sharing responsibility. It is critical that health plans make this amount transparent and easily available both to patients and clinicians. The recognized amount should reflect the amount for the specific item or service on the claim as submitted by the provider. In the event that the item or service ultimately changes and the patient’s cost share needs to be subsequently modified, the appropriate party should be accountable for resolving the issue-- leaving the patient out of the middle.
• Initial Payment and Denial of Payment: The No Surprises Act states that no later than 30 days after a bill is submitted, the health plan must issue an initial payment OR a notice of denial of payment. Failure to make an initial payment nor provide a notice of denial within 30 days of the submission of the original claim should be deemed a de facto notice of denial. Further, once the initial payment or notice of denial of payment is made, the timeline for initiating the negotiation process and subsequently the IDR process must begin without any unintended delays.
• Audits of Plan Calculation: The No Surprises Act requires that an audit process be implemented in order to ensure that health plans accurately determine the qualifying payment amount. ACEP and EDPMA believe that the audit process should be reflective of statistically valid samples of payments issued to an individual clinician or clinician in the same medical specialty. In some cases, there should be penalties if payors do not comply with these audits, including potentially civil monetary penalties or exclusion from participation in the federal Health Insurance Marketplace.

3.  Federal/State Law Interaction

• Definition of "Specified State Law:” For state-regulated plans, the No Surprises Act defers to “specified state laws” that have a method in place for determining the total amount payable for out-of-network services. ACEP and EDPMA believe that there should be clear and definitive patient protections and a clear method for determining the “total amount ” Federal agencies should also consider supporting independent dispute resolution (IDR) for emergency services whether via state or federal law. Vague or incomplete state laws should not count as specified state laws since they fail to provide meaningful patient protections or a method for settling dispute, including access to IDR.
• Treatment of ERISA Plans: In states where there is a specified state law, all ERISA plans should be subject to the provisions of the No Surprises Act and not that state law.

4.  The Independent Dispute Resolution (IDR) Process

• IDR Entity Certification Criteria: The certification of IDR entities is the first step to setting up a federal IDR system. The IDR entities available for selection should not be costly or bureaucratic entities that would create a cumbersome federal IDR process. Further, the IDR entity must not only be free from direct conflict with potential parties, but also free from a general bias toward either health plans or providers.
• Batching: ACEP and EDPMA believe that federal agencies should implement a methodology for batching that allows an out-of-network provider to choose to batch claims eligible for IDR either in the name of the individual or in the name of his or her physician group. In addition, the No Surprises Act allows for batching of claims in the IDR process for items and services “related to the treatment of a similar condition,” and we believe that there should not be a granular definition of “similar conditions” that prevents meaningful access to batching for emergency department (ED) providers.
• Definition and Weighting of IDR Payment Determination Criteria: The No Surprises Act directs the arbiter to equally consider numerous criteria in rendering a determination, and it is essential to ensure that this is explicit in regulation.
• Unreasonable Plan Payments during Cooling-off Period: IDR payment determinations commence a 90-day "cooling- off period." However, an IDR decision does not inform the initial payment for disputed claims incurred during the cooling off To help with cash flow, providers and facilities should be protected from unreasonable initial payments from plans during the required 90-day cooling-off period.
• Legal Options: Federal agencies must consider the unique statutory requirements that apply to services furnished in the ED when implementing regulations about the federal IDR process.
• IDR Determination: Once an IDR determination is made, the non-prevailing party will need to make up the difference with the prevailing party within 30 days, as per the law. If such a payment is not made by the end of the 30-day period, interest should apply.

5.  Administrative Processes

• Reduce Administrative Burden: The No Surprises Act includes many new administrative processes, and therefore federal agencies should consider ways to limit the overall burden on clinicians.
• Identifying Plan Type of EOBs: Clinicians may have a difficult time appropriately identifying eligible plan members by Explanation of Benefit (EOB) statement. Thus, health plans should identify clearly on all EOBs that a member is a beneficiary of a certain plan type.
• Provider Enrollment Time: Provider enrollment timeframes vary greatly by payor, in some cases taking up to 90 to 120 days to finalize. Payors must have timely, up-to-date provider enrollment systems and must be held accountable for meeting network adequacy standards and receive penalties for non-compliance as appropriate.

6.  State All-payer Claims Databases (APCDs)

• Use of APCDs as part of “Specified State Laws”: States may use a non-profit database not affiliated or subsidized by a health plan as part of their “specified state law” for determining the total amount payable. State laws that rely on named databases, such as FAIR Health, should be considered a specified state law given that this is a method for determining the total amount payable.
• APCD Reporting Requirements: There should be specific APCD reporting requirements in the regulation, including a mandate that all health plans report data, mandatory metric reporting of the number and percentage of plans broken out by plan type, reporting of the percentage of insured and uninsured, reporting by specific geo-zip regions, and reporting of every code by specialty taxonomy or site of service.
• Access to Data: States may also allow the public to access the data. Completely restricting access to the data or allowing certain plans to opt out of reporting would jeopardize the usefulness and integrity of the data included in APCDs.

Now that this letter has been sent, what are our next steps? First, ACEP and EDPMA have requested a joint meeting with the Center for Consumer Information and Insurance Oversight (CCIIO—one of the main agencies implementing the law) and are hoping to engage further with them on our recommendations. There will also be plenty of future opportunities to talk to federal agencies like CCIIO and weigh in on key aspects of the law. As stated earlier, there will be multiple rounds of rulemaking-- and with each new proposed reg comes a long public comment period (typically 60 days) in which we can provide input on specific proposals. Once a reg is released, we expect the EM SMB Implementation Task Force to help ACEP and EDPMA evaluate the proposed policies in the reg and develop recommended responses.

I recognize that many stakeholders are chomping at the bit now to get meetings with federal agencies before the regs are actually released. A couple points to make regarding that understandable inclination:

• While we think it is useful to have some initial meetings with agencies, it is important to note that CCIIO and other key agencies do not have political leadership in place yet. While career staff do draft the regs, the political leadership needs to ultimately sign off on all the key decision points in developing the regs as well as all the policies that they ultimately will contain. Thus, if political officials aren’t in place yet to sign off on the policies, there is only so much that career staff can state definitively during meetings. We hope that CCIIO (which is part of the Centers for Medicare & Medicaid Services or CMS) will have leadership in place in the next several weeks or months.
• It is essential that emergency medicine has a unified voice and consistent message when talking through issues with federal agencies. That was the main reason why ACEP and EDPMA formed a joint task force in the first place! If we do not express a unified and clear position on key issues, federal agencies won’t understand what the emergency medicine community as a whole believes and may wind up implementing policies that aren’t advantageous to you and your patients.

Please keep these last points (especially my final one) in mind as we continue going through the regulatory process. I’ll end with my continued promise to keep you updated on this important work--- now that you all know I’ll keep it!

Until next week, this is Jeffrey saying, enjoy reading regs with your eggs.