Biden-Harris Administration Issue Third Rule to Implement No Surprise Act, Protect Americans From Surprise Medical Bills

WASHINGTON D.C. Sept 30 – The Biden-Harris administration – through the departments of Labor, Health and Human Services, Treasury and the Office of Personnel Management – today issued an interim final rule with comment period to continue implementation of the No Surprises Act, a consumer protection law that helps curb the practice known as “surprise billing” for medical care.

The interim final rule details the federal arbitration process – or the independent dispute resolution process as it’s also known – that providers, facilities or providers of air ambulance services, and health plans or issuers will use to determine final payment beyond allowable patient cost-sharing for certain out-of-network healthcare services in situations where the No Surprises Act prohibits surprise billing. The rule also requires that certain providers and facilities provide a good faith estimate of the charges to uninsured (or self-pay) individuals so they can know what costs to expect when seeking healthcare.

Today’s rule is the third in a series that the departments are using to implement the No Surprises Act, a priority for President Biden. In July, the President directed HHS to prioritize and implement this law as part of the Executive Order on Promoting Competition in the American Economy. In the same month, the departments issued an interim final rule on consumer protections against surprise billing. In early September, they issued a proposed rule to help collect data on the air ambulance provider industry. The two interim final rules take effect on Jan. 1, 2022, and ban surprise billing for emergency services and ancillary care at in-network facilities, and limit high out-of-network cost sharing for emergency and non-emergency services, such that it cannot be higher than if such services were provided in-network.

“Fear of surprise billing should never be a barrier to receiving medical care,” said U.S. Secretary of Labor Marty Walsh. “At the Department of Labor, we are committed to empowering all workers and their families, including by helping to make sure they receive the healthcare benefits they are legally entitled to. Today’s rulemaking is another step by the Biden-Harris administration that will help protect Americans from surprise billing that can discourage needed medical care or lead to financial peril.”

“No one should have to go bankrupt over a surprise medical bill,” said U.S. Secretary of Health and Human Services Xavier Becerra. “Today’s rule helps ensure that Americans get a better deal from a more competitive healthcare system. We are building on our ongoing efforts to deliver on President Biden’s Competition Executive Order by promoting transparent out-of-network costs, exposing inflated health care costs and taking consumers out of the middle ultimately to help lower their bills.”

To protect patients from surprise bills and remove them from the middle of payment disputes between out-of-network providers, facilities, or providers of air ambulance services and health plans or issuers, on July 1, 2021, the departments and OPM issued an interim final rule with comment period. The interim final rule states that, beginning in 2022, patients will only be required to pay cost sharing based on in-network rates for certain out-of-network emergency services, out-of-network non-emergency services at in-network facilities and out-of-network air ambulance services.

Today’s rule builds on this work and details how the total payment to an out-of-network provider or facility will be determined. In some cases – based on the law – state law or application of a state All-Payer Model Agreement will determine this amount. Where neither applies, the rule sets forth the federal process that will apply for determining the amount. When a payment dispute for items/services that fall under surprise billing protections occur, either a provider, facility, or air ambulance provider or plan/issuer may initiate a 30-day open negotiation period. If open negotiation fails, either party may initiate the federal independent dispute resolution process. This rule details how this process initiates, what is eligible for this process and how independent dispute resolution entities should consider factors when determining a payment amount.

The departments will certify independent dispute resolution entities on a rolling basis. Entities seeking certification by Jan. 1, 2022 should submit their application by Nov. 1, 2021. Learn more about the certification process or apply to be a certified independent dispute resolution entity.

In added consumer protections, today’s rule outlines key requirements related to uninsured (or self-pay) individuals (self-pay individuals are individuals who have coverage but do not choose to have their care billed to their health plan or issuer). When individuals schedule an item or service with certain providers and facilities, those providers and facilities will be required to inquire about the individual’s health coverage status, and if the individual wants their care billed to their health plan or issuer.

The provider or facility must provide a good faith estimate of expected charges for the care they are scheduling for individuals deemed uninsured (or self-pay). An uninsured (or self-pay) individual may also request a good faith estimate, without scheduling an item or services. The rule also establishes a process for uninsured (or self-pay) individuals to initiate a payment dispute resolution process if they are ultimately billed substantially in excess of the good faith estimate they received.