By: Julius W. Hobson, Jr.

On July 1, 2021, the “No Surprises Act” Interim Final Rule, Part I, was issued jointly by the Office of Personnel Management (OPM), Internal Revenue Service (IRS), Department of the Treasury (Treasury), Employee Benefits Security Administration (EBSA), the Department of Labor (DoL), the Centers for Medicare and Medicaid Services (CMS), and the Department of Health and Human Services (HHS). The Interim Rule is the first implementing rule.

The Interim Rule has several provisions that include:

• Ban on surprise billing for emergency services. Emergency services, regardless of where they are provided, must be treated on an in-network basis without requirements for prior authorization.
• Ban on high out-of-network cost sharing for emergency and non-emergency services. Patient cost sharing, such as co-insurance or a deductible, cannot be higher than if such services were provided by an in-network physician, and any coinsurance or deductible must be based on in-network provider rates.
• Ban out-of-network charges for ancillary care (like an anesthesiologist or assistant surgeon) at an in-network facility in all circumstances.
• Ban other out-of-network charges without advance notice. Health care providers and facilities must provide patients with a plan language consumer notice explaining that patient consent is required to receive care on an out-of-network basis before that provider can bill at the higher out-of-network rate.

In general, the regulations do allow out-of-network providers to balance bill members in limited situations. Prior to an out-of-network provider balance billing a patient post-stabilization, or non-emergency, services, the provider must give notice to the patient, and the patient must acknowledge receipt of the information as well as give informed consent to waive the balance billing protections. The regulations seek to ensure that patients who choose out-of-network providers to have ample time to consider their decision.

A nonparticipating provider or nonparticipating emergency facility providing care must make notices available in any of the 15 most common languages in the geographic region in which the applicable facility is located.

Under the Interim Final Rule, nonparticipating emergency facilities, participating health care facilities, and nonparticipating providers are required to retain written notice and consent documents for at least a seven-year period after the date on which the item or service in question was furnished.

The rule anticipates plans, issuers, health care providers, facilities, and providers of air ambulance services will incur significant costs to comply with its requirements.

The regulations are generally effective on September 13, 2021. The Interim Final Rule is generally applicable to group health plans and health insurance issuers for plan and policy years beginning on or after January 1, 2022. The HHS-only regulations that apply to health care providers, facilities and providers of air ambulance services are applicable beginning on January 1, 2022.

Employer organizations are pleased with the regulations. It appears they keep payment rates lower than what medical providers were proposing. Employers and health insurers have advocated for keeping rates paid to providers down, while physicians and hospitals took the position that insurers should not be given the upper hand in setting their rates.

The Interim Final Rule specifies that emergency room rates would not be averaged with freestanding emergency rooms, which tend to be more expensive. Rates for teaching hospitals, which typically charge higher rates, would not be calculated separately from non-teaching hospitals.

This interim rule is the first of several to implement the statute. Other forthcoming regulations include the following:

• A model disclosure that providers and facilities must use to satisfy the disclosure requirements.
• Procedures governing the Independent Dispute Resolution process for reimbursement disputes. This is the most significant matter in the process.
• Directions regarding disclosure requirements, provider network directories, cost reporting, continuity of care, as well as good faith compliance with the No Surprise Billing Act’s requirements.

Comments are due no later than 5:00 p.m. on September 7, 2021. Comments may be submitted electronically at: https://www.regulations.gov.