QPA No Surprises Act Dispute Resolution and Federal Protections

The No Surprises Act provides federal protections for patients in the event of a QPA dispute. This means that patients are shielded from surprise medical bills in most cases.

The Act requires providers to give patients advance notice of any billing disputes. This notice must be provided 30 days before the dispute is submitted to an independent dispute resolution (IDR) process.

Patients have the right to file a complaint with the U.S. Department of Health and Human Services (HHS) if they feel they've been unfairly billed. This is a free service that can help patients resolve disputes quickly and efficiently.

The No Surprises Act (NSA) has several key provisions that aim to protect patients from surprise medical bills.

Protection from Surprise Bills is a core aspect of the NSA, which prohibits surprise billing in certain situations, such as emergency services provided by out-of-network providers or non-emergency services performed at in-network facilities where patients didn't have the opportunity to choose an in-network provider.

Patients are only responsible for paying their in-network cost-sharing amounts, such as copayments, coinsurance, and deductibles, even if they receive care from out-of-network providers in the situations outlined by the NSA.

The NSA also establishes an Independent Dispute Resolution process to resolve disputes between healthcare providers and insurers over out-of-network charges. This process involves an independent arbiter who considers various factors, including the median in-network rate for the service in question, when determining the final payment amount.

The NSA has the potential to create challenging situations for physicians, especially those who have chosen to remain out-of-network with a specific plan. However, the law includes a broad range of factors that the arbiter must consider during these negotiations.

Under the No Surprises Act, patients have robust protections against surprise billing. The Act requires providers to disclose patient protections against balance billing, including how to report violations.

The Federal No Surprises Act protects consumers from balance billing in emergency situations, or when treated by an out-of-network provider at an in-network hospital, ambulatory surgical center, or by an air ambulance provider. They are protected from surprise bills for amounts over what their plan paid.

Non-participating providers and emergency facilities are generally forbidden from billing patients for payment amounts greater than the in-network cost-sharing requirement for emergency services. This applies to group health plans or group or individual health insurance coverage.

The Act prevents surprise billing for non-emergency services rendered by non-participating providers at certain participating healthcare facilities, unless notice and consent was given in some circumstances. These facilities include hospitals, hospital outpatient departments, critical access hospitals, and ambulatory surgical centers.

In Michigan, the balance medical billing law limits how much an out-of-network provider can collect in certain situations. This includes emergency patients, non-emergency patients without the ability to choose a participating provider, and patients who haven't received required disclosures.

Here are the specific situations where out-of-network providers are limited in what they can collect:

In these situations, the provider is limited to collecting the greater of the median amount negotiated by the patient's carrier or 150% of the Medicare fee for service schedule for the healthcare service provided.

The No Surprises Act (NSA) establishes a process for resolving disputes between healthcare providers and insurers over out-of-network charges. This process involves an independent arbiter who considers various factors, including the median in-network rate for the service in question, when determining the final payment amount.

If a provider and insurance company cannot resolve a disagreement over payment for out-of-network services through negotiation, they may utilize an IDR process in the form of a “baseball-style” arbitration. This process involves a third party choosing one appropriate payment from two suggestions offered by the provider and the insurer.

The Qualified Payment Amount (QPA) is a key consideration in this process. The QPA is generally the insurer's median in-network rate and may be an approximation of what the insurer would have paid for the service if provided by an in-network provider or facility.

Notably, legal challenges to the IDR process have resulted in changes to the use of the QPA. Arbitrators were initially required to give greater deference to the QPA, but a federal court ultimately struck down this rule and arbitrators are now directed to consider the QPA more generally along with certain additional information submitted by the parties.

Here are the key factors that arbitrators must consider during the IDR process:

The IDR process is a crucial aspect of the No Surprises Act, providing a fair and balanced mechanism for resolving disputes between providers and insurers.

The Federal Protections under the No Surprises Act are designed to shield consumers from surprise medical bills.

Providers are required to disclose patient protections against balance billing, which includes information about federal and state balance billing protections and how to report violations.

These disclosures must be prominently posted at the facility, made available on a public website if applicable, and provided to patients in a timely manner.

The No Surprises Act requires that a patient's cost share be based on the Qualifying Payment Amount (QPA), also known as the Median in-network rate.

Providers are prohibited from billing patients for more than their cost share, protecting them from surprise medical bills.

The Federal No Surprises Act protects consumers in emergency situations. If you receive emergency care or are treated by an out-of-network provider at an in-network hospital, you're protected from balance billing.

You won't be hit with a surprise bill for the amount over what your plan paid. This is because the Federal No Surprises Act requires your cost share to be based on the Qualifying Payment Amount, also known as the Median in-network rate.

This means providers can't bill you for more than your cost share.

To identify if the Federal NSA applied to an Aetna claim, check your Explanation of Benefits (EOB) which provides the NSA disclosures. The EOB explains how to determine the Qualified Payment Amount (QPA).

The QPA is calculated by subtracting the “not payable” amount from the “submitted charges” amount shown on each covered service line on the EOB. This calculation is done in accordance with the requirements defined in the NSA.

You only need to pay the cost share reflected on the EOB, and you are prohibited from balance billing the member for any other amount for covered services.

Plan sponsors need to determine which provider will calculate the QPA, as this will impact claims processing. The No Surprises Act requires plan sponsors to ensure claims are processed correctly for their effective date.

Plan sponsors should review compliance considerations, including how the claims administrator will know which claims are subject to the No Surprises Act. This will help protect participants from balance billing.

Plan sponsors must also ensure the federal No Surprises Act Model Notice is available on the plan's website and on Explanation of Benefits forms. This notice is crucial for participants to understand their rights and protections under the law.

Plan sponsors have had to implement the No Surprises Act requirements on a short timeline. The law's effective date is plan years beginning on or after January 1, 2022.

Plan sponsors must review compliance considerations, including which provider will determine the QPA and how the claims administrator will know which claims are subject to the No Surprises Act.

Plan sponsors should ensure that the federal No Surprises Act Model Notice is available on the plan's website and on Explanation of Benefits forms. This notice is crucial for participants to be protected from balance billing.

Plan sponsors need to determine who will handle requests from healthcare providers for an "open negotiation" period and subsequent IDR process.

Calculating questions for plan sponsors can be a daunting task, but understanding the basics can make it more manageable.

Plan sponsors need to calculate the present value of future benefits to determine the total cost of the plan.

The present value calculation takes into account the expected return on investment, which is typically assumed to be 7% in the US.

A 7% return on investment may seem conservative, but it's a common assumption that helps plan sponsors estimate costs accurately.

To calculate the present value of future benefits, plan sponsors need to consider the expected number of years until retirement and the assumed rate of inflation.

For example, if a plan sponsor assumes a 3% rate of inflation, they'll need to adjust the benefit payments accordingly to account for future increases in cost.

Plan sponsors also need to calculate the actuarial present value (APV) of future benefits, which takes into account the expected number of participants and their expected ages at retirement.

The APV calculation helps plan sponsors determine the total cost of the plan and make informed decisions about funding and investments.

Ultimately, accurate calculations are crucial for plan sponsors to ensure the long-term sustainability of the plan.

The new guidance for QPA calculations is outlined in IRS Revenue Procedure 2022-11. This guidance sets forth the rules for adjusting the median contracted rate for 2022 claims.

The combined percentage increase for 2022 claims is 1.0648523983, which will be applied to the median contracted rate for items and services provided between January 1, 2022, and January 1, 2023.

Group health plans may round the resulting QPA to the nearest dollar, simplifying the calculation process. This rounding rule applies to the final QPA amount, not to the intermediate calculations.

The formula for calculating the combined percentage increase is (CPI-U 2019/CPI-U 2018) × (CPI-U 2020/CPI-U 2019) × (CPI-U 2021/CPI-U 2020). This formula is used to calculate the percentage increase for 2019, 2020, and 2021 claims.

Special rules apply to the calculation of QPA for anesthesia services and air ambulance services, but the formula for increasing the base rate remains the same. The percentage increase is still calculated using the same rules.

A group health plan may use the example provided in the Revenue Procedure to calculate the QPA for a service code with a median contracted rate of $12,480 as of January 31, 2019. The plan would increase the median contracted rate by 1.0648523983, resulting in a QPA of $13,289.36, which may be rounded to $13,289.

Michigan has its own medical billing law, known as the Michigan Balance Medical Billing Law, which was enacted in 2020. This law supplements the federal No Surprises Act and provides additional consumer protections against surprise billing.

The law limits how much an out-of-network provider can collect from a patient in certain situations. For instance, if a patient receives emergency care from an out-of-network provider at a participating health facility, the provider can only collect the greater of the median amount negotiated by the patient's carrier or 150% of the Medicare fee for service schedule.

Here are the specific circumstances where the provider is limited in their collection:

The law also requires out-of-network providers to disclose certain information to patients, including: