Monday, September 06, 2021
The Department of Labor recently issued interim final rules on the prohibition of surprise billing contained in the Consolidated Appropriations Act of 2021 (CAA). Under the CAA and these new rules, “surprise billing” is prohibited for plan years beginning on or after January 1, 2022.
Surprise billing occurs when a patient sees an out-of-network provider during an emergency, or in a non-emergency case when a patient sees an in-network provider but gets care from an out-of-network provider, such as an anesthesiologist. These expenses usually do not count toward an individual’s deductible and out-of-pocket limits.
The No Surprises Act (NSA), included in the CAA, provides federal protections against surprise billing and limits out-of-network cost-sharing under many circumstances in which bills arise. Under the new rules, surprise bills are no longer permitted for emergency services, services provided at an in-network facility by an out-of-network provider unless consent has been provided, and air ambulance services (“protected services”).
The NSA is far-reaching and applies to group health plans, fully insured as well as self-funded, and health insurance issuers offering group or individual health insurance coverage. It applies to all group sizes and extends to non-federal governmental plans, church plans, grandfathered plans, grandmothered plans, student health insurance, and insurers that offer coverage through the Federal Employees Health Benefits Program. It does not apply to excepted benefits, health reimbursement arrangements (or other account-based plans), or retiree-only plans.
Impact on Participants
Plan participants may be billed for protected services, but their cost-sharing responsibilities will apply as if the protected services were provided in-network. Health plans will be required to pay any balance to the out-of-network providers and facilities directly.
In addition, the new rules expand participant protections by requiring that health plans:
– Cover emergency services without requiring prior authorization
– Provide an explanation of benefits showing that participant cost-sharing for protected services was based on in-network rates
– Count any amounts participants pay towards protected services provided out-of-network towards their in-network deductibles and out-of-pocket limits
– Make a notice (the regulations include a template) that explains the surprise billing rules publicly available on the plan’s public website and include it with each explanation of benefits for protected services
The NSA defines emergency services to include items and services needed to screen, treat, and stabilize a patient with an emergency medical condition. An emergency medical condition occurs when someone has acute symptoms that are sufficiently severe that a prudent layperson could reasonably expect that immediate medical attention is needed.
The definition of emergency services includes a medical screening exam, further treatment to stabilize the individual, and post-stabilization services. Furthermore, the definition specifically includes services provided at an independent freestanding emergency department and is intended to cover any healthcare facility licensed to provide emergency services.
The NSA provides new protections to plan participants by mandating that health plans cannot:
– Limit the coverage of emergency services based on plan terms or conditions (other than the exclusion or coordination of benefits), waiting periods, or cost-sharing requirements Impose limits on out-of-network providers that are more restrictive than those for in-network emergency care
– Deny coverage for care received in an emergency setting based solely on diagnostic codes
– Deny coverage for emergency care without first applying a prudent layperson standard
– Require a time limit between the onset of symptoms and when the patient sought emergency care or deny coverage simply because symptoms were not sudden
– Deny emergency services based on general plan exclusions (e.g., denying emergency coverage for pregnant dependents because a plan excludes dependent maternity care)
Post-Stabilization and Non-Emergency Services
While the NSA bans the most common types of balance bills, it does not prohibit them in every circumstance. Specifically, the protections do not apply if a patient consents to treatment by an out-of-network provider. The NSA also only applies to certain types of items and services, meaning balance bills can still be sent by providers or facilities that provide non-emergency care not covered under the definitions included in the NSA (e.g., services delivered in a physician’s office).
Additionally, the NSA allows out-of-network post-stabilization services to be paid at the out-of-network rates if certain conditions are met.
If care is provided in a non-emergency situation, a provider can obtain a patient’s consent to be billed for out-of-network services in the same manner as for post-stabilization services. However, the notice-and-consent option is not available for certain services for which the NSA specifies that a patient cannot be balance-billed.
When providers/facilities provide notice and receive consent, they must notify the patient’s health plan so claims can be administered appropriately and provide the plan with a signed copy of the written notice and consent documents.
Next Steps for Employers
Employers sponsoring fully insured plans have no direct action to take at this time because the insurance carriers are tasked with complying with these new rules. However, self-funded plan sponsors are responsible for ensuring compliance with their plans and they should work closely with their claims administrators to ensure their plan is ready to comply with these rules by January 1, 2022, deadline.
Beth Oldfield, Vice President of Compliance at Hilb Group, is a compliance specialist with over 25 years of experience in the field and a member of Hilb Group’s national compliance practice group.
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