Starting Jan. 1, 2022, millions of Americans will be safeguarded from surprise medical bills as part of the No Surprises Act. It’s a historic milestone, and at the same time, members of the Coalition Against Surprise Medical Billing have consistently urged the Biden Administration to make sure consumers have full protection against any loopholes that providers and private equity firms might use to drive up health care costs. That goal is even more important ahead of the forthcoming release of new rules around a federal arbitration process, also known as independent dispute resolution (IDR).
Experience from states that have implemented arbitration shows that out-of-network providers and private equity firms have frequently used IDR to increase their own reimbursement – far beyond the actual cost of care in local markets. In a new letter to the agencies implementing the surprise billing law, Coalition members reinforced the importance of preventing “the IDR process from becoming the norm for determining payment for out-of-network services.”
Highlights from the letter are included below:
- “Addressing the root causes of surprise medical billing requires a comprehensive approach. We appreciate the important and foundational reforms that the Administration included as part of the first interim final rule (IFR) (“Requirements Related to Surprise Billing; Part 1) as well as the recent Executive Order taking action to counter anticompetitive hospital consolidation that contributes to higher costs and fewer choices for patients… We wanted to reinforce the vital groundwork laid to lower patients’ costs through the initial IFR and the importance of protecting all health care consumers from unintended cost pressures related to the independent dispute resolution (IDR) process.”
- “Unfortunately, the experience in several states, including New York, Texas, and New Jersey, shows how easy it is for IDR to be abused by private equity firms and out-of-network providers at patients’ expense. Crafting consumer-centric rules that ensure an efficient, transparent and cost-effective IDR process is critical to achieving the cost-savings forecasted by the Congressional Budget Office.”
- “We have outlined several critical recommendations for achieving that goal:
- IDR should be limited and only used as a last resort for payment disputes.
- The qualifying payment amount (QPA) should be the primary and overriding consideration for final payment determinations as part of the IDR process.
- IDR rules should exclude the use of third-party database pricing information.
- Arbitrators should be required to provide substantive written justifications on final payment decisions if the decision deviates from the QPA.
- IDR rules should prevent automation of disputes while allowing limited, efficient batching of claims to minimize administrative costs and prevent misuse of the process.
- IDR regulations must prevent abuse of the notice and consent process that can lead to forced patient consent under duress.”
To view the full letter and additional recommendations to protect patients from costs associated with arbitration, click here.