A survey by AHIP and the Blue Cross Blue Shield Association shows The No Surprises Act, which was passed with the intent of preventing surprise medical bills, has lived up to that goal by preventing more than 2 million surprise medical bills across all commercially insured patients.
The analysis also found that should this trend hold, more than 12 million surprise bills will be avoided in 2022.
Among other provisions, the NSA established a process for resolving disagreements on what a health plan would pay the out-of-network provider or facility, culminating in independent dispute resolution (IDR), a process questioned by providers in a lawsuit against the Department of Health and Human Services. Since taking effect at the beginning of 2022, a key question of interest to federal policymakers has been how many claims may be disputed through IDR each year, and what impact that will have on the affordability of healthcare.
Voters have also expressed support for protections against surprise medical bills. A recent poll conducted by Morning Consult on behalf of the Coalition Against Surprise Medical Billing found 79% of voters are concerned that lawsuits from physician and hospital organizations could delay or overturn the patient protections included in the NSA.
WHAT’S THE IMPACT
AHIP and BCBSA convened in April to gather information on the number of claims that were eligible for dispute under the federal NSA in the first two months of 2022. An NSA-eligible claim was defined as a claim incurred by a member or enrollee covered by the plan or coverage during any plan year beginning on or after January 1, 2022 for an item or service within different categories.
Those categories included emergency services (including post-stabilization care) provided by a non-participating provider; and any non-emergency item or service provided by a non-participating provider at a participating facility (including hospitals, hospital outpatient departments, and ambulatory surgery centers).
The survey found that 0.23% of all commercial claims were NSA-eligible. While that estimate appears low, when it’s multiplied by the total number of claims in the commercial market, it yields a substantial number of potential surprise bills that have been avoided due to the NSA, the survey found.
Based on the responses of the claims that have been processed at the time of the survey, there were 600,000 NSA-eligible claims in the commercial market in January and February 2022.
Yet due to the substantial delay in claims processing, the methodology used assumes an undercount of the true number of NSA-eligible claims in the commercial market. Using past data on the total number of claims processed by commercial health plans, AHIP and BCBSA estimated there were more than 2 million NSA-eligible claims in commercial markets during the first two months of 2022.
THE LARGER TREND
The No Surprises Act was enacted on December 27, 2020 to address surprise medical bills. It limits the amount an insured patient will pay for emergency services at an out-of-network provider and limits what will be paid for certain non-emergency services from an out-of-network provider at an in-network facility. The Act requires insurers to reimburse out-of-network providers at a calculated out-of-network rate.
If the provider disagrees with the insurer’s determination, the provider may initiate a 30-day period of open negotiation with the insurer over the claim. If the parties cannot resolve the dispute through negotiation, the parties may then proceed to independent dispute resolution arbitration, which is the subject of a provider lawsuit.
In December 2021, the American Hospital Association and American Medical Association sued the Department of Health and Human Services and other federal agencies over implementation of the No Surprises Act. The groups are not against the legislation, they said, but take issue with how HHS implemented the bill in its September rule, which provided the IDR process.
The arbitrator must select the offer closest to the qualifying payment amount. Under the rule, this amount is set by the insurer, giving the payer an unfair advantage, according to the lawsuit. This is contrary to the legislation, which was passed Dec. 27, 2020, as part of the Consolidated Appropriations Act, 2021, which strove to create a balance of power between provider and payer, the groups said.
Because the rule gives the payment rate advantage to insurers, the lawsuit said, it will encourage them to narrow their networks by not contracting with providers who have higher costs. This includes teaching and other hospitals that provide trauma care, burn units and neonatal intensive care services, the lawsuit said.