No Surprises Act
By now, it is no surprise (pun intended) that you have heard of the No Surprises Act (NSA). In this blog we want to take you through the details of the new law that was installed on January 1, 2022 and talk about how you can implement the requirements of this legislation within your practice. We know that change can be hard, especially widespread change, but we believe that most of the requirements for this legislation can have a positive impact on your practice and the clients that you serve.
The NSA establishes new federal protections against medical bills that surprise patients in the medical industry. The act took effect in 2022. Surprise bills arise when insurance clients inadvertently receive care from out-of-network providers. This issue is widespread in hospital settings and Emergency Rooms across the United States. In fact, around 20% of people in the United States have received a surprise medical bill from a hospital visit in the last decade. Because of the widespread nature of this issue, the federal government passed the NSA in 2021 and believes that it will apply to about 10 million out-of-network surprise bills in the next year.
The NSA protects consumers in a few ways. First, it requires private health plans to cover these out-of-network claims and apply in-network cost sharing. This is good news for your out-of-network clients! This means that more people will be able to receive your services for an affordable price. However, this does eliminate the practice known as “balance billing”, which is when a provider bills a client the difference between what an insurance company pays and what the cash value of the service is.
The NSA also protects consumers by prohibiting doctors, hospitals, and other covered providers from billing patients more than in-network cost sharing amount for surprise medical bills. As stated above, this means that providers will only be able to bill their clients the contracted rate amount for a particular service.
For services covered by the NSA, providers are prohibited from billing patients more than the applicable in-network cost sharing amount; a penalty of up to $10,000 for each violation can apply.
Today, many out-of-network doctors and hospitals bill patients directly for their full, undiscounted fee, leaving to patients to submit the out-of-network claim to their insurance and collect what reimbursement they can. That common billing practice will change starting next year. Providers will need to first find out the patient’s insurance status and then submit the surprise out-of-network bill directly to the health plan. Providers are “encouraged” to include information about whether NSA protections apply on the claim itself (including, whether the patient has consented to waiver her balance billing protections, described below.) Health plans must respond within 30 days, advising the provider of the applicable in-network cost sharing amount for that claim; cost-sharing generally will be based on the median in-network rate the plan pays for the service. The health plan will send an initial payment to the provider and send the consumer a notice (called an explanation of benefits, or EOB) that it has processed the claim and indicating the in-network cost sharing amount the patient owes the out-of-network provider. Only at this point is the out-of-network provider allowed to send the patient a bill for no more than the in-network cost sharing amount.
How will clients know if a bill or claim constitutes a surprise medical bill?
It is up to both providers and health plans to identify bills that are protected under the NSA. The regulations also request public comment on whether changes to federal rules governing electronic claims (so-called HIPAA standard claims transactions) are needed to indicate claims for which surprise billing protections apply.
Providers and plans also must notify consumers of their surprise medical bill protections. Providers and facilities must post a one-page disclosure notice summarizing NSA surprise billing protections on a public website and give this disclosure to each patient for whom they provide NSA-covered services. If you click the link above and download the zip file, Appendix 1 within that zip folder provides the guidelines and a model notice that you can use with your patients. This notice must be provided no later than the date when payment is requested, though the regulation specifies it is not required to be included with the bill, itself. Health plans are also required to provide consumers the disclosure notice with every EOB that includes a claim for surprise medical bills.
If a health plan or provider (or both) fail to properly identify a surprise bill, it will be up to the patient to recognize that NSA protections should apply and seek relief.
Mental health providers can ask consumers to waive rights
An exception to federal surprise billing protections is allowed if patients give prior written consent to waive their rights under the NSA and be billed more by out-of-network providers. Providers are never allowed to ask patients to waive their rights for emergency services or for certain other non-emergency services or situations described above. Consent must be given voluntarily and cannot be coerced, although providers can refuse care if consent is denied.
There will be more commentary on the NSA in the weeks and months to come but we would encourage you to talk with our team about outsourcing your billing so that you can receive more in-depth content from us and help from an experienced biller.