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Payment
September 30, 2021 05:04 PM

HHS lays out surprise billing resolution process in new rule

Jessie Hellmann
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    The Biden administration on Thursday laid out the process that out-of-network providers and plans can use to settle surprise billing disputes.

    The long-awaited rule implements a law passed by Congress last year banning providers from sending surprise bills to patients who unknowingly received out-of-network care.

    Under the interim final rule published Thursday, if an out-of-network provider and payer can't come to an agreement over payment during a 30 day "open negotiation," they may turn to an independent dispute resolution process.

    The rule "takes consumers out of the middle of a payment dispute between insurers and providers," a Health and Human Services official told reporters Thursday.

    Download Modern Healthcare’s app to stay informed when industry news breaks.

    HHS already released a rule earlier this summer implementing parts of the law, banning providers from sending surprise bills to patients for emergency services beginning January 1. It also bans charges for services provided by out-of-network providers at in-network facilities, unless notice and consent is given. It also limits high out-of-network cost-sharing for emergency and non-emergency services for patients.

    Instead, a patient's insurer and provider must work out payment.

    The rule issued Thursday lays out that process and opens the portal for organizations to apply to be independent dispute resolution entities.

    The parties may jointly select a certified independent dispute resolution entity, which must attest to having no conflicts of interest, according to the rule.

    Under the IDR process, the parties can submit their offers for payment. The entity will then issue a binding determination within 30 days, selecting one of the offers as the payment amount. Both parties must pay an administrative fee, which is $50 each for 2022.

    The non-prevailing party must also pay a fee to the IDR entity.

    According to the rule, the IDR entities must begin with the presumption that a plan's median in-network contracted payment for a service is the appropriate amount, a win for insurers.

    The federal government will certify IDR entities on a rolling basis, with applications due November 1.

    The rule issued Thursday also requires providers give "good faith" estimates of expected charges to uninsured people seeking care.

    "Price transparency is a reality in almost every aspect of our lives except healthcare," Centers for Medicare and Medicaid Services Administrator Chiquita Brooks-LaSure said. "The Biden-Harris administration is committed to changing this."

    Good faith estimates must include expected charges for items or services that are expected to be provided along with the primary treatment, according to the rule.

    When an uninsured individual receives a bill that is at least $400 higher than the estimate, they can enter a patient-provider dispute resolution process.

    Chip Kahn, CEO of the Federation of American Hospitals, called the rule issued Thursday "a total miscue."

    "It inserts a government standard pricing scheme arbitrarily favoring insurers," Kahn said. "For two years, hospitals and other stakeholders stood shoulder-to-shoulder with lawmakers to develop legislation that would protect patients from surprise medical bills and last December, Congress passed a bill with a fair and balanced payment dispute resolution process. This regulation discards all of that hard work, misreads congressional intent, and essentially puts a thumb on the scale benefiting insurers against providers and will over time reduce patient access."

    Tags: Payment, This Week in Healthcare, Legislation & Regulation, Payment, Transformation, Transformation Hub, Insurers
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