Payers, providers seek leeway on surprise medical bill ban going into effect in 2022

Both providers and payers have major concerns with how regulations to ban surprise medical bills will be implemented next year, with providers concerned about added burden and insurers clamoring for more time.

Providers believe that new requirements for notices of impending out-of-network charges and estimates on costs could provide a major administrative burden, according to comments on a regulation that outlines the protections. Payers, meanwhile, say they will need more time to implement parts of the rule and want a safe harbor from any inadvertent penalties.

Top insurance industry lobbying group America's Health Insurance Plans (AHIP) said in comments that it has “significant concerns about whether the health plans have sufficient lead time and regulatory clarity to implement and operationalize many of the nonconsumer facing portions of these and subsequent regulations.”

Late last year, Congress in the No Surprises Act banned providers from delivering surprise medical bills to consumers, with the protections starting next January.

But how to implement these protections could cause undue burdens for physicians and hospitals, several groups said.

One of the requirements in the rule is that providers must send a notice to the patient 72 hours before a procedure that lets them know the services won’t be fully covered by their insurance plan.

Medical Group Management Association said in comments it supports the intent behind providing notice, the “strict timeline established will provide significant administrative burden on practices to comply with these requirements, without the guarantee that patients have the time to discuss and fully understand the surprise billing notice documents.”

RELATED: FAH: Surprise billing arbitration process has to be more flexible on timing, batching of claims

Every physician has different operating procedures, and the new notice and consent requirements could “upend physician practice operations,” MGMA said. “If a patient requires a service to be scheduled for that day with an out-of-network clinician, it can require that the physician reschedule numerous other patients and services to accommodate the strict three-hour timeline for services.”

Another concern among providers is the process where patients can voluntarily waive their balance billing protections and get billed for out-of-network care. A provider must give the patient a good faith estimate to a patient that outlines their out-of-pocket costs.

“The good faith cost estimates require medical groups to predict what services will be provided to patients during a single episode of care,” MGMA said. “Each patient is unique and requires a specific course of treatment and care plan. Requiring group practices to apply general estimates of services to different patients will undermine the clinical practice of clinicians.”

MGMA recommends that the Department of Health and Human Services and the Centers for Medicare & Medicaid Services should focus instead on other price transparency requirements and “not layer on additional burdensome administrative hurdles to provide similar information to patients.”

The estimate must be calculated using the expected billing and diagnostic codes for the care. But the Biden administration needs to offer more guidance on what specific codes should be used, said the American Hospital Association in comments.

AHA said that the notice-and-consent documents given to patients to waive their balance billing protections must also include a list of any in-network providers that can perform the care. But this list could provide a major burden.

“Providers will need to either rely on the plan’s provider directory or contact the plan directly to obtain information on alternative in-network providers,” the comments said. “This process will not guarantee accurate information and will be highly burdensome for providers.”

AHA said that sometimes provider directories could have major errors that hospitals could be on the hook for relaying to patients.

The association believes the provider shouldn’t be on the hook for creating this list and instead “direct the patient to their health plan to identify an alternative.”

But providers did cheer the inclusion of a ban on insurers retroactively denying patients' emergency department claims if the diagnosis isn't considered an emergency.

The Federation of American Hospitals wrote in comments that the Biden administration needs to look at other abuses by insurers. 

"The FAH urges the departments to expand their oversight of plans and issuers to prevent and address unlawful and abusive plan practices," the group said.

The rule is the first regulation related to surprise billing, which Congress banned in a law late last year. A second regulation is expected later this year to detail the arbitration process to settle disputes between payers and providers over out-of-network charges.

Need for a safe harbor

Payers were concerned about whether they have the time to implement several parts of the rule by Jan. 1, 2022.

AHIP said in comments that there should be a good faith safe harbor through 2023 to help shield insurers who may make mistakes during implementation.

For instance, AHIP said that the “necessary infrastructure” doesn’t exist for nonparticipating providers or facilities to transmit required notice and consent forms or information to insurers when a patient waives their balance billing protections.

Most policy forms also must be finalized by state regulators, but this won’t be feasible prior to plan years “beginning on or after January 1, 2022, given the status of rulemaking related to surprise billing,” the group said. “This is an example of where a good faith safe harbor until 2023 would recognize health plans and issuers need additional time to submit updated policy forms.”

There is also an issue with staggered compliance, as many plans will renew in the middle of this year and prior to January 2022.

“As a result, some enrollees will be in plans not subject to many of the No Surprises Act’s requirements, but providers will be nonetheless subject to their requirements,” AHIP said. “For these plans, issuers are unclear what information must be communicated to noncalendar year plan enrollees about the No Surprises Act before the end of 2021.”