Most of the surprise billing focus in August has understandably been centered on the highly anticipated final rules related to the arbitration process outlined in the bipartisan No Surprises Act. For those that might have missed it, however, on August 10, 2022, a federal district court upheld the No Surprises Act against a challenge brought by a New York surgeon who argued that major parts of the law were unconstitutional. The Coalition Against Surprise Medical Billing, a diverse group of health care leaders working together to protect patients from surprise bills while lowering health care costs, applauded the New York court for siding with patients and their families by dismissing this lawsuit — one of the eight provider-backed lawsuits intended to chip away at the vital protections of the No Surprises Act and regulations.

A recent piece by Katie Keith published in Health Affairs Forefront outlines the factors at play in the case and the patient-friendly ruling.  Below are Key excepts from the article.

Additionally, the Coalition issued a statement in response to the arbitration final rule and new data from the Administration demonstrating how providers and hospitals have been using the arbitration process exponentially more than originally predicted, with 46,000 disputes initiated in just under 4 months. The extent of utilization, overutilization, and misuse of IDR in the initial months is alarming and we urge the Biden Administration to monitor vigilantly and report on the use of arbitration and its outcomes to ensure the No Surprises Act lowers health care costs as intended.

Key excerpts from Health Affairs Forefront: 

  • “On August 10, 2022, a federal district court upheld the No Surprises Act (NSA) against a challenge brought by a New York surgeon who argued that major parts of the law were unconstitutional. The stakes were high. If the court had agreed with the plaintiffs, the case could have undone hard-fought, bipartisan protections, and millions of patients would have once again seen higher costs from surprise out-of-network bills. Instead, the judge rejected these arguments, even dismissing some with prejudice (meaning they cannot be brought again).
  • “In a decision issued on August 10, Judge Ann M. Donnelly, a federal district court judge in the eastern district of New York, rejected a constitutional challenge to the NSA. The lawsuit was filed on December 31, 2021—one day before the NSA took effect—by Dr. Daniel Haller and his practice, Long Island Surgical PLLC. He is an acute care surgeon in Long Island who provides emergency care and surgery; nearly 80 percent of the patients treated by the practice are out of network.
  • The plaintiffs argued that major parts of the NSA are unconstitutional, pointing to the provisions that establish the arbitration process (42 U.S.C. § 300gg-111(c)) and that bar providers from sending balance bills to patients for emergency services (42 U.S.C. § 300gg-131) and non-emergency services (42 U.S.C. § 300gg-132). They asserted (without merit, in my opinion) that Congress does not have the authority to protect patients from balance bills or establish a federal arbitration process and that these provisions violate the Seventh Amendment, due process under the Fifth and Fourteenth Amendments, and the Takings Clause.
  • “Consistent with seven other lawsuits over implementation of the NSA, Dr. Haller also challenged parts of an interim final rule on arbitration that the Biden administration issued in 2021.
  • “…Judge Donnelly rejected the plaintiffs’ arguments, concluding that Dr. Haller and Long Island Surgical did not show they would face irreparable harm if the NSA were to remain in effect or that they were likely to succeed on the merits.”