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Surprise Medical Bills / Out-of-Network Payment

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a medical bill with a calculator, stethoscope and pen

Why This Matters

Out-of-network billing, or “surprise medical bills” occur when a patient receives a bill for the difference between the out-of-network provider’s fee and the amount covered by the patient’s health insurance, after co-pays and deductible. Patients often assume that facility-based providers—such as radiologists, pathologists, physician anesthesiologists and emergency physicians—are in-network because their surgeon and hospital are in-network.

Physician anesthesiologists recognize being a provider in their patients’ health plans is better for their patients. While health insurance companies often try to limit patient access to physician anesthesiologists’ services by creating physician networks with too few physicians, data indicates that the vast majority of claims for anesthesia services – more than 90% – are in their patients’ health plans or “in-network,” thereby limiting patient exposure to “surprise medical bills.”

What You Should Know

In December 2020, H.R. 133: Consolidated Appropriations Act was signed into law. Among the vast contents of this bill was a section titled the No Surprises Act, which is comprised of several key provisions addressing surprise medical bills. The key provisions protect patients from surprise medical bills in emergency and nonemergency situations and create a mechanism for physicians and health insurance companies to address the bills for medical services. Other provisions include:

  • Ensuring patients are only responsible for in-network cost-sharing
  • Transparency requirements for plans and providers, requiring that patients be provided certain information, including updated directories.

This legislation created an independent dispute resolution process modelled on those in New York and Texas that ensures physicians and health insurers can resolve their billing disputes.  Key elements of the process include:

  • Plans will make the initial payment to the out-of-network provider
    • If a dispute occurs, physicians  and plans can attempt to negotiate a resolution for 30-days before accessing the independent dispute resolution/arbitration process.
  • Arbitration process is baseball-style (each party submits an offer and the arbitrator has to choose one of the two offers).
  • No minimum billing amount threshold to enter into arbitration.  The same or similar disputed claims can be bundled or batched together
  • Arbitrator can consider all information submitted by the provider and insurer, including the median in-network rate, complexity of the case, and market power of the provider and payor, among other things.
    • They cannot consider public payor rates (e.g., Medicare and Medicaid) or billed charges
  • Arbitrator’s decision is final, and payment must be made within 90 days
  • The loser is responsible for the fees
  • A 90 day cooling off period exists in which time providers and insurers cannot initiate a new arbitration process for the same item/s or service/s
    • Providers can continue to collect and batch cases during this period and submit them for arbitration at the conclusion of the 90 day period
  • Payors are still required to provide regular payments to providers within this window
  • An interim report will be created to report to Congress two years after enactment to ensure rigorous oversight of the development of the arbitration process

While the surprise billing provisions are less than perfect, they do represent significant improvement from previous pro-health insurer proposals sought by some in Congress.   ASA thanks Congress for their efforts to reach a more balanced final bill that treats physician more fairly. The No Surprises Act is effective January 1, 2022, and is currently the subject of a federal process to create the regulations to implement the law.

What ASA is Doing For You

ASA will continue to engage the US Departments of Health and Human Services and Labor in the rulemaking process to ensure that patients are protected from surprise bills and that anesthesiologists are treated fairly under the new law and not subjected to unfair negotiation tactics by health insurance companies.

For more than two years, ASA co-led a coalition of medical specialty organizations as the “Out of the Middle Coalition,” advocating for a fair and balanced solution to surprise medical bills. This coalition advocated for patients and informed lawmakers about out of network medical bills, successfully thwarting several legislative proposals that would have been detrimental to the specialty and harmful to patients.

New: ASA, ACEP, and ACR File Lawsuit Against the Federal Government’s Implementation Rules for ‘No Surprises Act’
Read the ASA news release
Read the full filed complaint (PDF)

 

What You Can Do Now

 

This page is curated by Amanda Cate, Associate Director of Governmental and Political Outreach, and was last updated March 2022.

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