MGMA survey: New good faith estimates causing extreme burdens for physician practices

Physicians are already saddled with more paperwork to comply with a new requirement they give patients good faith estimates of care costs, a new survey finds. 

The Medical Group Management Association (MGMA) released Tuesday its annual regulatory burden report (PDF) outlining key headaches practices face. While prior authorization remains a top burden, the new requirement in the No Surprises Act to offer good faith estimates has shot up. 

“In a time of runaway inflation and unprecedented workforce shortages, the federal government is layering on additional regulatory burdens that, while in theory are beneficial to patients, act more as an impediment to delivering care,” said Anders Gilberg, senior vice president of government affairs at MGMA, in a statement Tuesday.

MGMA surveyed executives representing more than 500 group practices on the administrative burdens they are facing. 

The top source of frustration was prior authorization with 81% of executives calling it very or extremely burdensome. However, coming in second was a new source stemming from the good faith estimate requirements at 70%. 

Starting this January, providers were required to offer a good faith estimate to any uninsured or self-pay patient detailing what they could be charged for an item or service. The requirement is part of regulations implementing the No Surprises Act, which outlaws surprise medical bills.

A patient can dispute to the Department of Health and Human Services any bill that is $400 or more above the estimate.

In 2023, the estimate must also include information from any co-providers or facilities. This means the estimate will be extended to include any fees related to a surgery or procedure and prescription drug or device charges.

MGMA found that 82% of practices say the estimate requirement increased administrative burden. In addition, 74% of practices don’t have the technical infrastructure ready to comply with the new requirements set to start in 2023. 

A key problem with the estimate requirement is that the Centers for Medicare & Medicaid Services (CMS) and Congress fundamentally misunderstand how practices operate, said Claire Ernst, MGMA’s director of government affairs, in a statement to Fierce Healthcare.

“For instance, practices must include the expected charges and service codes for items/services to be furnished during the visit, even when no diagnostic code is available,” she said. 

Logistically, a practice would have to offer an un-reimbursable “consultation prior to actually scheduling the service,” Ernst said. This effort could cause confusion for the patient who is “essentially being triaged on the phone. This makes even less sense for new patients who do not have an existing relationship with the practice or for patients who are less capable of ‘self-reporting’ their symptoms.”

MGMA has previously asked CMS to go easy on enforcement until a “standard technical solution” can be implemented to help practices. 

“At this moment, we do not have one, and it is unlikely this will happen in the next two or so months,” she said.

MGMA’s survey also showed 82% want more guidance from CMS on understanding how to handle state and federal surprise billing requirements. Another 78% seek more help on creating the estimates. 

Prior authorization problems continue

While the good faith estimates create a new layer of burden for practices, prior authorization—where a provider must first get insurer approval before performing a service or doling out prescriptions—remains the top source of concern for practices. 

“Practices continue to face growing challenges with prior authorization, including issues submitting documentation manually via fax or through the health plan’s proprietary web portal, as well as changing medical necessary requirements and appeals processes to meet each health plan’s requirements,” the report said. 

The survey found that 82% of practices rated their prior authorization requirements as “very or extremely” burdensome. The issue is compounded by the fact that more commercial and Medicare Advantage (MA) plans are adopting the practice, which can help them cut down costs. 

There could be congressional action on this issue before the end of the year. The House passed the Improving Seniors’ Timely Access to Care Act last month, which creates an electronic prior authorization for MA plans. The legislation would also create a process for a quick decision on items or services that already get routine approval from insurers.