Two of the primary goals of the No Surprises Act were to protect patients from surprise medical bills and to lower health care costs for all consumers. The key to achieving both of those priorities require common-sense patient protections that would curtail market loopholes, like arbitration, that many out-of-network providers and private equity firms consistently exploit.
In the latest interim final rule (IFR), the Biden-Harris Administration adhered to the statute in clearly specifying how these important consumer protections would work when the No Surprises Act takes effect on Jan. 1, 2022. As a result, millions of Americans will see improved access to affordable, in-network care without the threat of a surprise bill from private equity-backed providers or the back-end costs associated with a cumbersome arbitration process.
Leading organizations representing patients, employees, union members and families applauded the Administration for these consumer-centric policies and urged the tri-agencies to maintain these provisions as the law takes effect.
- “Overall, the interim final rule adopts a federal IDR process that will incentivize payers and providers to resolve payment disputes in a consistent and efficient manner. The Biden administration is clear that its goal is to help hold down health costs and encourage the parties to negotiate, submit reasonable offers, and resolve disputes in a way that does not add unnecessary time, cost, or complexity to this process.” – Katie Keith, Jack Hoadley, and Kevin Lucia, Center on Health Insurance Reforms, Georgetown University
- “In line with the statute, the Biden Administration’s rulemaking promotes the law’s objectives of ‘reducing prices that may have been inflated due to … surprise billing,’ most concretely in two ways … [First], by clarifying that the qualifying payment amount is calculated as a median among contract-specific prices rather than claims, thus reducing the weight given to outlier high rates paid to large staffing companies who appear to have most-leveraged surprise billing. [Second], in [the recent IFR], by specifying that arbitrators must start with the presumption that the QPA (generally the median in-network rate) is the appropriate out-of-network price & only deviate in the face of clear evidence to rebut this presumption.” – Loren Adler, USC-Brookings Schaeffer Initiative for Health Policy
- “Arbitration must be a last resort for payment disputes, with evidence showing it consistently favors providers over payers, leading to higher costs and worse choices for people seeking care. On the occasions when arbitration must occur, the amount an insurer typically charges for similar in-network services in the same area should be the primary factor in deciding cases and needs to be defined clearly by regulators from the outset. Families USA appreciates the clear message Congress sent in passing the No Surprises Act and the Biden administration’s speed in issuing these rules so no one has to have a medical emergency followed by an economic one.” – Families USA
- “We’re gratified that regulators implementing surprise billing protections are serious about cost-savings for insured Americans. Under the proposed rules, not only will consumers be protected from the out-of-pocket costs of outrageous surprise bills, but we won’t be burdened by the added costs of exorbitant arbitration awards to out-of-network providers. Keeping payments reasonable by tying them to local in-network negotiated rates means providers still get paid fairly, and consumers won’t bear the burden of costs shifted to our premiums when providers lose outlier lottery-sized payment demands.” – U.S. PIRG
- “The No Surprises Act is one of the strongest consumer protection laws Congress has enacted over the past ten years, and the interim final rule faithfully implements Congress’ intent to reduce unnecessary health care costs, encourages providers and payers to reach reimbursement agreements on their own, and protects employees from higher premium costs that might otherwise occur.” – HR Policy Association
- “The latest round of interim final regulations (IFR) … wisely bases the appropriate payment amount for a disputed service … on the qualifying payment amount for a similar service. This approach confirming the primacy of median negotiated rates will help maintain existing incentives for providers to join provider networks, which will, in turn, put downward pressure on health care costs and related premiums.” – American Benefits Council
- “Recent rulemaking by HHS, DOL/EBSA, and Treasury/IRS regarding independent dispute resolution (IDR) takes a thoughtful and balanced approach by requiring the arbitrator to presume that the Qualifying Payment Amount (QPA) is the appropriate out-of-network payment amount. In our view, this requirement is good for employer plan sponsors and the American health care system by encouraging early agreement and cooperation between payers and providers both in a dispute resolution proceeding and beforehand by maintaining the incentives for network participation. Additionally, we expect employers to benefit from improved cost predictability when the QPA is presumed to apply with narrow exceptions.” – Business Group on Health
- “The rules reinforce the intention of the ‘No Surprises Act.’ The law states – and the regulations support – that arbitration will be based upon market-driven rates determined by negotiation between providers and payors. If a provider demands greater out-of-network rates than what other providers in that market have agreed to, the burden is on them to justify it. And arbitration itself will be limited in scope and cost to prevent health care dollars from being wasted on administrative costs.” – The ERISA Industry Committee
- “The new rule states that the independent dispute resolution process must begin with a presumption that the qualified payment amount which is largely based on the median in-network rate is the appropriate rate when settling out-of-network services. This key requirement will greatly enhance the consumer protections in the No Surprises Act as well as prevent rising healthcare premiums due to surprise billing.” – National Association of Health Underwriters
- “The latest iteration of the draft interim final regulations rightly emphasizes the QPA, while allowing the arbitration mediator to consider additional factors only as required. This is crucial to achieving the budget savings [the Congressional Budget Office] envisioned and to shielding patients from surprise bills and ever higher insurance premium costs.” – National Retail Federation
- “PBGH strongly supports the interim final rule promulgated by the agencies. This clarity and commitment to basing the arbitration around the local market rate reduces the incentive of health care providers to go to arbitration. The net result will be lower administrative costs and lower prices for employers, their employees and their families.” – Purchaser Business Group on Health
- “The National Alliance of Healthcare Purchaser Coalitions (National Alliance) strongly supports the final rule and the legislation has been a priority focus for the organization.”
To read the Coalition’s statement on the latest interim final rules for the No Surprises Act, click here.