HHS: Protections against surprise medical bills implemented at dawn of new year

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As 2022 gets underway, new federal protections against surprise medical bills have gone into effect. The U.S. Department of Health and Human Services has said these protections will shield consumers from bills from out-of-network providers, facilities and ambulance providers. They went into effect January 1.

Implemented under the No Surprises Act, they ban surprise billing in private insurance for most emergency care and many instances of nonemergency care. They also require that uninsured and self-pay patients receive key information, including overviews of anticipated costs and details about their rights.

The Biden Administration has touted these measures, saying they will help to promote competition in healthcare and other sectors of the American economy.

A November 2021 report from the HHS Office of the Assistant Secretary for Planning and Evaluation (ASPE) reviewed evidence on surprise billing and the need for the consumer protections in the No Surprises Act. The report showed that surprise billing is common for people with private insurance. Nearly one in five patients who go to the emergency room, have an elective surgery or give birth in a hospital receive surprise bills, with average costs ranging from $750 to $2,600 per episode.

WHAT'S THE IMPACT?

For people who have health coverage through an employer, a health insurance marketplace or an individual health plan purchased directly from an insurer, the new rules ban surprise bills any time a patient receives emergency care, and require that cost sharing for these services, like co-pays, always be based on in-network rates, even when care is received without prior authorization.

They also ban surprise bills from certain out-of-network providers if a patient goes to an in-network hospital for a procedure. This means cost sharing for certain additional services during the visit will generally be based on in-network rates, according to HHS.

The new rules also require providers and facilities to share with patients easy-to-understand notices that explain the applicable billing protections, and who to contact if they have concerns that a provider or facility has violated them.

For people who don't have health insurance or pay for care on their own, the rules require most providers to give a "good faith estimate" of costs before providing non-emergency care, said HHS.

The good faith estimate must include expected charges for the primary item or service, as well as any other items or services that would reasonably be expected. For an uninsured or self-pay consumer getting surgery, for example, the estimate would include the cost of the surgery, as well as any labs, other tests and anesthesia that might be used during the procedure.

Uninsured or self-pay consumers who receive a final bill that exceeds the good faith estimate by $400 or more can dispute the final charges.

Although some states have enacted laws to reduce or eliminate surprise billing, comprehensive nationwide consumer protections were not available until the implementation of the new rules, according to HHS. What the No Surprises Act does, the agency said, is build a national baseline of protections with the series of final and proposed rules issued in 2021, which complement existing laws in states where they already exist.

THE LARGER TREND

When the surprise billing protections were still in the interim stage over the fall, they received a mixed reaction among players in the industry, with the American Hospital Association calling the interim final rule a "windfall for insurers."

"The rule unfairly favors insurers to the detriment of hospitals and physicians who actually care for patients," the AHA said at the time. "These consumer protections need to be implemented in the right way, and this misses the mark."

While the No Surprises Act has protections that are strongly supported by hospitals and health systems, the interim final rule "has moved away from Congressional intent" and floats proposals that Congress had rejected, the AHA said.

Meanwhile, AHIP, which represents insurers, struck a different tone, saying the independent dispute resolution process in the interim final rule should encourage more providers to join health plan networks.

The Blue Cross Blue Shield Association called it a "win for patients" and a step toward a more affordable and equitable health system.

The final rule also drew positive reaction from the Coalition Against Surprise Medical Billing, which said the rules reinforce the statute that calls for the qualifying payment amount to be the primary and overriding consideration for final payment determinations as part of the independent dispute resolution (IDR) process.

Surprise medical bills can average more than $1,200 for services provided by anesthesiologists, $2,600 for surgical assistants and $750 for childbirth-related care, according to the report from the HHS Office of the Assistant Secretary for Planning and Evaluation.

Twitter: @JELagasse
Email the writer: jeff.lagasse@himssmedia.com