No Surprises Act: Your Top Questions Answered - Part 2

This blog is part two of a blog series focusing on answering the most common questions regarding the No Surprises Act. View Part One, which focused on questions related to providing a good faith estimate and obtaining patient consent.

The No Surprises Act (NSA) — which provides patient protections by addressing surprise billing and banning balance billing — has many people wondering which parts of the Act apply to them and how to meet the requirements.

Listed below are answers to the most common questions we’ve been asked related to services impacted and billing process under the No Surprises Act.

Are independent free-standing reference labs, pathology groups, and radiology practices impacted by the No Surprises Act (NSA)?

Yes, the NSA applies to emergency and non-emergency services provided by all healthcare providers and all commercial health plans. Under NSA, services are defined as services provided at or in conjunction with services provided at a healthcare facility, including imaging services, laboratory services, devices, and pre-operative or post-operative services.

Are only services performed at a hospital or in a surgery center impacted?

No, NSA requirements include no balance billing for air ambulance services, emergency services, and non-emergency services by nonparticipating providers at certain participating healthcare facilities, including hospital outpatient departments, critical access hospitals, and ambulatory surgical centers. Services are not limited based on the physical location of the service provider. For example, if a patient goes to a hospital or surgery center for a procedure and as part of the procedure is referred to a diagnostic provider not physically located at the hospital or surgery center, those diagnostic services are still covered under this legislation.

Will payors automatically process claims at the in-network rate when billed by an out-of-network provider?

No, under the NSA, payors have 30 days to deny or pay a claim. Initially, payors may not have the appropriate logic built into their system to provide the in-network patient responsibility rate on the explanation of benefits (EOB). Therefore, it is important to review the EOB prior to billing the patient.

Can I bill the patient the patient-responsibility amount listed on the EOB?

Yes, if the EOB returns with a patient responsibility denial code (PR), providers can bill that amount to the patient. Providers should not bill the patient if the EOB returns with a contractual obligation denial code (CO). While out-of-network (OON) payors should return the EOB with a PR denial code, sometimes providers who are unable to secure direct contracts are contracted under a third-party administrator with the payor and could receive a CO denial prohibiting billing.

Is there a process to dispute the payment received from the payor?

Yes, the NSA established an independent dispute resolution (IDR) process to determine out-of-network payment amounts between providers and payors. The provider has 30 days after payment or denial was received from the payor to initiate open negotiation. If an agreement cannot be reached by the end of the 30-day open negotiation period, IDR may be initiated.  During the IDR process, an IDR entity is selected and offers are submitted. The IDR entity will select an offer for payment, within 30 days of receiving offers. 

Is the Provider-Payor Dispute Resolution Process being revised?

Yes, the Texas Medical Association, American Medical Association, American Hospital Association, American Academy of Radiology, College of American Pathologists, and several other entities either filed a lawsuit or joined an existing lawsuit. The lawsuits did not challenge the premise of the act which is to protect patients from surprise billing but sought alignment between statute and the regulations for the IDR process between providers and payors. During the IDR process, there was an emphasis on using the qualifying payment amount (QPA). QPA is determined as the payor’s median contracted rate as of January 31, 2019, in the same insurance market. There is a concern that, instead of producing market-rate physician payments, the QPA will generate an artificially low benchmark payment.

In February 2022, a Texas federal judge ruled that the IDR process conflicts with the NSA legislation. HHS said it will revise its guidance for determining the payment amount for out-of-network services in light of the ruling. It also said it would train certified independent dispute resolution entities and disputing parties on the revised guidance. HHS will also permit parties to reopen a negotiation period for disputes if it expired.

Does the No Surprises Act overrule state legislation on balance billing?

No, the No Surprises Act does not overrule state law. Some states may have additional requirements in addition to the national legislation. Currently, 18 states have comprehensive balance billing legislation in place that prohibits balance billing in all emergency and non-emergency situations.

Are payors now required to send a payment for out-of-network services directly to the provider now?

Yes, this is one of the positive aspects of the NSA. When an out-of-network claim is received, payors are required to send payment or notice of denial within 30 days of receiving a clean claim, and payment or denial should be sent directly to the payor. Since providers have 30 days from receipt of the payment or denial to start the dispute process the regulations require payors to send payment directly to the provider. However, it may take payors a few months to get the system and process up to date with this legislation. 

Additional XIFIN NSA Resources:

Download XIFIN’s Preparing for the No Surprises Act Step-by-Step Guide

Visit the XIFIN No Surprises Act Resource Center which includes FAQs, complimentary webinars, NSA industry news, and resources from industry experts.

Published by XiFin
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