On 28 December 2020, the federal No Surprises Act (Act)1 was enacted. The Act seeks to protect patients from so-called “surprise medical bills” in certain emergency and nonemergency settings for out-of-network patients. This alert focuses on the Act’s arbitration provisions but first provides necessary background to those provisions.
Read moreSurprise Medical Billing – Changes to Law Will Have a Significant Impact on Group Health Plans
On December 21, 2020, Congress passed the Consolidated Appropriations Act, 2021, which included a $900 billion COVID-19 relief and stimulus package and a new set of rules intended to address “surprise” medical billing. The No Surprises Act (the “Act”), which is part of the 2021 appropriations act, makes various changes to ERISA that are intended to ban the practice of “surprise” medical bills, which arise when a person covered by a group health plan unexpectedly receives emergency medical care from an out-of-network provider at an out-of-network facility or from an out-of-network provider at an in-network facility. In these instances, the out-of-network provider can bill the person for the difference between their charged rate and the amount an employer’s group health plan (or the insurer) agrees to pay, which is known as “balance billing.” The Act takes several steps to address this situation.
Read moreResolving COVID related insurance claims - how can mediators help?
We have all followed the high profile test case, brought by the FCA, to clarify how Business Interruption policies should respond to pandemic related claims. The Supreme Court judgment in The Financial Conduct Authority v Arch and Others has provided much needed guidance on the law is this area. Not least, it has overturned the egregious decision in the Orient Express Hotels case which left a hotel policyholder without cover from the impact of Hurricane Katrina. The court had decided in the now discredited case that a policy holder can’t claim for a BI loss if the event which caused it damage also led to wider area damage which would have affected its business even if it had suffered no direct loss!
Read moreThe Federal No Surprises Act and Its Arbitration Provisions
On 28 December 2020, the federal No Surprises Act (Act)1 was enacted. The Act seeks to protect patients from so-called “surprise medical bills” in certain emergency and nonemergency settings for out-of-network patients. This alert focuses on the Act’s arbitration provisions but first provides necessary background to those provisions.
Read moreUpdate on Federal and New Jersey Surprise Billing Legislation
The Consolidated Appropriations Act, 2021, signed by President Trump on December 27, 2020, included within its over 5,900 pages the controversial and long-debated No Surprises Act (the Act), addressing surprise medical bills. The Act seeks to protect patients from unexpected medical bills for out-of-network services they receive, and also establishes an arbitration system for resolving billing disputes between out-of-network health care providers and payers. The Act takes effect on January 1, 2022, and it is anticipated that regulations will be adopted to clarify a number of provisions in the Act prior to that time. New Jersey health care providers and insurers are already subject to the Out-of-Network Consumer Protection, Transparency, Cost Containment and Accountability Act (the New Jersey Act), which was passed by the state legislature and signed by Governor Murphy in 2018, and is similar in several significant aspects to the federal Act. This alert will review the patient protection and payer-provider billing dispute procedures of the new federal Act, compare them to the New Jersey Act and discuss how providers have fared under the arbitration process established by the New Jersey Act.
Read moreNew COVID-19 Bill Puts Kibosh on Surprise Medical Billing Beginning in 2022
On December 27, 2020, the Consolidated Appropriations Act, 2021, was signed into law. The Act included a measure entitled the “No Surprises Act” to restrict medical providers from sending consumers surprise medical bills.
Once the Act goes into effect in 2022, consumers will not receive balance bills for the following:
Emergency care;
Transport by air ambulance; or
Non-emergency care at an in-network facility, when patients are unknowingly treated by an out-of-network doctor or lab
In these situations, consumers would only be responsible for paying their deductibles and co-payments per the terms of their in-network health insurance plans. Under the Act, medical providers are prohibited from making patients responsible for the difference between their deductibles/co-payments and any higher fees that the provider wants to charge.
Read moreUnderstanding 2021 Changes in Emergency Medicine Reimbursement
Emergency medicine groups face several changes this year, including a new federal ban on surprise medical billing, updates to the Medicare reimbursement formula, changes to the CMS MIPS program, and new billable services. Below is a summary of these changes provided by the experts at Brault Practice Solutions.
Read moreUnderstanding the No Surprises Act
Starting January 1, 2022, it will be illegal for providers to bill patients for more than the in-network cost-sharing due under patients’ insurance in almost all scenarios where surprise out-of-network bills arise, with the notable exception of ground ambulance transport. Health plans must treat these out-of-network services as if they were in-network when calculating patient cost-sharing. The legislation also creates a new final-offer arbitration process to determine how much insurers must pay out-of-network providers. If an out-of-network provider is dissatisfied with a health plan’s payment, it can initiate arbitration. The arbitrator must select between the final offers submitted by each party, taking into consideration several factors including the health plan’s historical median in-network rate for similar services.
Read moreTenet appeals $10M arbitration award to whistleblower physicians
Tenet Healthcare Corp. is appealing a ruling Monday by the U.S. District Court in Detroit that refused to vacate or seal a $10 million arbitration award to two whistleblower physicians.
Dr. Amir Kaki and Dr. Mahir Elder are two prominent cardiologists who held directorships and other privileges at Detroit Medical Center until defendants including Dallas-based Tenet refused to renew them, according to the ruling by the U.S. District Court in Dr. Amir Kaki et al. v. Tenet Healthcare Corp., et al.
Read moreCongress Prohibits Surprise Medical Bills, Sends Payment Disputes to Mandatory Arbitration
Congress’ year-end COVID-19 Relief Bill includes the No Surprises Act, aimed at curbing surprise medical bills starting in plan year 2022. Applicable to federally regulated health plans, the Act caps patient responsibility for out-of-network emergency services and removes the patient from resulting payor-provider reimbursement disputes. Such disputes will be resolved through mandatory baseball-style arbitration, subject to guidelines potentially limiting abuse of the arbitration process. The Act precludes consideration of both billed charges and governmental-payor reimbursements, and it imposes a loser-pays rule for arbitrator fees if the parties cannot agree on a reimbursement rate. The Act also regulates air ambulance bills and certain non-emergency services from out-of-network providers at in-network facilities (e.g., where the patient does not have the ability to choose an in-network provider at the facility).
Read moreCongress Prohibits Surprise Medical Bills, Sends Payment Disputes to Mandatory Arbitration
Congress’ year-end COVID-19 Relief Bill includes the No Surprises Act, aimed at curbing surprise medical bills starting in plan year 2022. Applicable to federally regulated health plans, the Act caps patient responsibility for out-of-network emergency services and removes the patient from resulting payor-provider reimbursement disputes. Such disputes will be resolved through mandatory baseball-style arbitration, subject to guidelines potentially limiting abuse of the arbitration process. The Act precludes consideration of both billed charges and governmental-payor reimbursements, and it imposes a loser-pays rule for arbitrator fees if the parties cannot agree on a reimbursement rate. The Act also regulates air ambulance bills and certain non-emergency services from out-of-network providers at in-network facilities (e.g., where the patient does not have the ability to choose an in-network provider at the facility).
Read moreQuebec Superior Court Confirms Arbitrability of Insurance Coverage Disputes
Ending years of ambiguous jurisprudence, Justice Gary Morrison confirmed, in 9369-1426 Quebec Inc. (Restaurant Baton Rouge) v. Allianz Global Risks, that Quebec law allows the arbitration of disputes under an insurance policy to the exclusion of the courts.
Facing business interruption losses due to COVID-19, certain Baton Rouge franchisees sought to certify a class action against Allianz on behalf of all its insured restaurants and bars in Quebec claiming coverage under a property insurance policy. On behalf of Allianz, Clyde & Co moved to dismiss the action and prevent certification based on the Policy's dispute resolution clause, which provided for mediation and/or binding arbitration. Justice Morrison granted the motion and dismissed the action.
Read moreAn Arbitration Solution to Surprise Medical Billings
The solution is a compromise proposed by a bipartisan group of Congressional legislators that involves both a binding quasi-arbitration process and comparisons with “in-network” payment rates.
Read moreOver $22.8 Million Located, Returned To Tennessee Consumers
The Tennessee Department of Commerce & Insurance (TDCI) announces today that over $22.8 million was located and returned to Tennesseans in combined life insurance benefits/annuities and monies returned through the Department’s mediation efforts in 2020. TDCI’s figures show:
Read moreThe No Surprises Act: Implications for Health Plans, Health Care Facilities, and Health Care Providers
Following months of congressional negotiations, on December 27, 2020, President Trump signed into law the Consolidated Appropriations Act, 2021, a $2.3 trillion piece of legislation that includes $900 billion in federal funding and relief for COVID-19.[1] The legislation also includes the No Surprises Act (“Act”), effective January 1, 2022, which significantly bolsters consumer protections for patients by addressing the circumstance of patients receiving “surprise bills” for health care services.[2] While we expect the Biden administration to issue regulations implementing the Act within the next year, stakeholders should be aware of the Act’s many new obligations on health plans,[3] health care facilities, and health care providers.
Read more340B Administrative Dispute Resolution Goes Live Amid a Flurry of 340B Litigation
The U.S. Department of Health and Human’s Services (HHS) Health Resources and Services Administration’s (HRSA) long-awaited administrative dispute resolution (ADR) final rule went into effect last week, on January 13, 2021. The ADR regulations, which have lingered in HHS since 2010, arrive amid increasing tensions and a flood of 340B-related litigation between covered entities, manufacturers, and HHS.
Read moreThe New Federal Out-of-Network Statute
As part of the recently enacted Consolidated Appropriations Act, 2021 (the "Appropriations Act"), the federal government did not only provide relief to stem the effects of the COVID-19 pandemic, but it also adopted the No Surprises Act.
Read moreOntario, Canada: Arbitrator Upholds Mandatory Employee COVID Testing
In Christian Labour Association of Canada v. Caressant Care Nursing & Retirement Homes (D. Randall), a union filed a group grievance on behalf of a number of its members working at an Ontario retirement home to challenge the reasonableness of a policy imposing bi-weekly COVID testing on all staff. In a December 9, 2020 decision, the arbitrator dismissed the grievance on the basis that the policy is reasonable when the privacy intrusion is weighed against the objective of preventing the spread of COVID in the retirement home.
Read moreNo Surprises: Congress Enacts Surprise Bill Law and Adds Mandatory Billing Transparency
The recently enacted Consolidated Appropriations Act, 2021 (the “Act”) not only funds the government and provides further relief in regard to the impact of the COVID-19 pandemic, but it also adopted a number of new substantive laws. We summarize below two key categories of new substantive law contained in the Act: (1) the prohibition on surprise medical billing; and (2) requirements related to price transparency.
Read moreSurprise Medical Billing Comes to An End, Insurers Oppose Arbitration Mechanism
After years of failed attempts, Congress has finally come to an agreement on a measure to end the practice of surprise medical billing.
Surprise billing, also known as balance billing, is the practice of charging patients for out-of-network procedures that insurers refuse to pay for in whole or in part. Often, patients incur these balance bills without their knowledge. The new legislation would ban providers from sending such a bill to patients, and would instead require providers to negotiate reimbursement with the patient’s insurer or submit the dispute to a binding arbitration process.
Providers will have 30 days from the day of the procedure to negotiate a compromise reimbursement amount with payers. If the parties can’t agree, they must submit their preferred reimbursement amounts to an HHS-approved arbitrator, who will pick one of the two amounts.
Loren Adler, associate director of the USC-Brookings Schaeffer Initiative for Health Policy, praised the legislation as “closer to the ideal, consumer-friendly solution” than previous attempts to address the issue.
“It’s very likely that this bill reduces premiums,” says Adler, who has contributed to research that found surprise billing increases health care costs.
Insurance stakeholders are displeased that surprise bills will be resolved through arbitration. Instead of arbitration, America’s Health Insurance Plans had lobbied for out-of-network reimbursement to be tied to a benchmark rate.
Adler thinks that insurers’ objections to arbitration are overblown, and he argues carriers will gain leverage in balance billing negotiations because of the legislation.
“It seems pretty easy for an insurer or a [plan sponsor] company to call a provider’s bluff,” Adler says, citing rules in the bill that he thinks will prevent providers from abusing the arbitration system.
Dan Mendelson, founder of Avalere Health, is more skeptical about the bill’s potential to reduce costs and slow premium inflation, since it will require new administrative costs.
“There is no question that whenever you force more cost into the system, it’s going to be reflected in consumer cost,” Mendelson explains. “So there will be a premium effect. Will people actually be able to differentiate it from the typical rise in costs? No….I do expect that it will have an effect, just from an economics standpoint.”
By Peter Johnson