The No Surprises Act, which then-President Trump signed into law on December 27, 2020, as part of the Consolidated Appropriations Act of 2021, addresses surprise medical bills from out-of-network providers when patients believe they are seeking care from in-network providers. Most sections of the act go into effect on January 1, 2022, and the Departments of Health and Human Services, Treasury, and Labor are working on regulations to implement many provisions of the act.

Below is a high-level overview of the key provisions. Click here for the full text of the act.

Requirements imposed on health insurance plans (Section 101)

There are detailed requirements mandating health plan compliance with respect to coverage for out-of-network emergency services and certain non-emergency services performed by out-of-network providers at in-network facilities, as described in more detail below. These requirements will apply to comprehensive individual and group health plans, including fully insured plans sold through the individual and group markets, as well as self-funded ERISA plans. Health insurers will be required to cover emergency services without any prior authorization regardless of whether the provider is in or out of network. Such services will be provided as if patients were in-network, with payment made by the health plan directly to the provider rather than directing the payments to the patients. Patients will be responsible for the same cost-sharing amounts they would have if the services were provided by an in-network provider. The same is true for non-emergency services provided by out-of-network providers subject to the notice and consent exception, discussed in more detail below.

Determination of out-of-network rates and independent dispute resolution process (Section 103)

Section 103 of the act sets forth several avenues to determine the rates for out-of-network services along with an independent resolution process through which health plans and providers may resolve any reimbursement issues.

Health care provider requirements (Section 104)

The key provision for patient protection under the act lies in Section 104. On the effective date of January 1, 2022, out-of-network health care providers (including facilities, physicians and non-physician practitioners) may not balance bill patients for covered emergency services or certain covered non-emergency services provided at in-network facilities unless certain conditions are met.

Patients who seek care from an out-of-network provider will not be balance billed for emergency services with respect to an emergency condition. For emergencies, the act’s definitions track the definitions in the Emergency Medical Treatment & Labor Act (EMTALA). The term “emergency services” means a “medical screening examination” that is within the capability of the emergency department of a hospital or of an independent freestanding emergency department, including ancillary services routinely available to the emergency department to evaluate such emergency medical condition and any other medical examinations and treatment to stabilize the patient.” For non-emergency services, out-of-network providers may not bill or balance bill (for any amounts not covered by the applicable insurance plan) patients for services provided, unless certain notice and consent requirements are met. The notice and consent requirements will be met if:

1. the patient is provided written notice and consent 72 hours in advance of the appointment;
2. the notice includes a good-faith estimate of the costs of the services; and
3. the notice provides a list of in-network providers at the facility and information regarding any prior authorizations, if applicable.

The foregoing notice and consent procedures, however, are not available for the following services: radiology, pathology, emergency, anesthesiology, diagnostic and neonatal services, assistant surgeons, hospitalists, and intensivists, and, therefore, patients may not be billed beyond their in-network cost-sharing amounts for these services. Notice and consent also is prohibited for providers offering services when no other in-network provider is available. Once the regulations are issued, this list may be expanded or some diagnostic laboratory tests may be removed.

This section will allow the Secretary of Health and Human Services to apply civil monetary penalties of up to $10,000 per violation, but may provide some exemptions or waive the penalties if the provider did not knowingly violate this section and corrects the violation.

Protections against air ambulance bills (Section 105)

The act also aims to protect patients from receiving surprise medical bills for out-of-network air ambulance services. Patients will be required to pay only the in-network cost-sharing amount for out-of-network air ambulances. Those amounts could then count toward the patient’s cost-sharing toward any deductibles the patient may have.

Transparency regarding in-network and out-of-network deductibles and out-of-pocket limitations (Section 107)

As of the effective date, health plans offering group and individual health insurance coverage will be required to include the following information on insurance cards:

1. all plan deductibles, including in-network and out-of-network deductible amounts, if applicable;
2. maximum limits on out-of-pocket costs, including in-network and out-of-network out-of-pocket cost limits, if applicable; and
3. a telephone number and web address for consumer assistance information, including information on in-network providers.

Patient protections through transparency and patient-provider dispute resolution process (Section 112)

The act establishes a new requirement for health care providers to give insured and uninsured patients “good faith estimates” in the form of an Advanced Explanation of Benefits (“AEOB”) as discussed in more detail below. The “good faith estimate” will provide the total expected charges for scheduled items or services, including the billing and diagnostic codes. Health care providers will be required to furnish this information for items or services scheduled at least three days in advance or whenever a patient requests it. Should a patient receive a substantially higher bill than the “good faith estimate,” the act and corresponding regulations will establish a patient-provider resolution process through which such discrepancies will be resolved.

The AEOB requirement (Section 111)

The act sets out detailed requirements for the information that must be included in the AEOB:

1. whether the provider or facility will be in-network for that particular item or service;
2. the “good faith estimate” of expected charges, including likely billing and diagnostic codes;
3. a “good faith estimate” of the insurance plan’s payment responsibility;
4. a “good faith estimate” of the patient’s expected cost-sharing amount based on the notification date and not the date of service;
5. a “good faith estimate” of the amount the patient has incurred toward meeting his or her financial responsibility limits such as their deductible and out-of-pocket costs;
6. a disclaimer that coverage for the item or service is subject to any prior authorizations, if applicable;
7. a disclaimer that information included in the AEOB is an estimate based on the information known at the time of scheduling and subject to change; and
8. any other information health plans determine to be appropriate to be included.

Continuity of care requirement (Section 113)

This section of the act requires health plans to ensure continuity of services when a health plan makes a change in its provider network. This protection will be extended to a patient defined as a “continuing care patient” who receives treatment for a serious or complex condition, undergoes institutional or inpatient care, is scheduled to undergo non-elective surgery including post-operative care, is pregnant and undergoing treatment, or is terminally ill and receives services. In these cases, health plans will be required to timely notify patients of any changes in the network status of its providers and facilities. The act will allow these patients to have up to 90 days of continued coverage at in-network prices to allow the patient time to transition to an in-network provider.

Conclusion

The act includes many transparency and compliance provisions for both health plans and health care providers that will need to be understood and implemented. The implementing regulations for the statute are being drafted by a number of government agencies (including the Departments of Health and Human Services, Labor, and Treasury) and will be published for notice and comment during 2021, in advance of the effective date. Given the breath and detail of the statutory requirements, the implementing regulations will be of great interest to health care providers and health plans. As these regulations are released, we will provide updates.

For questions or assistance with compliance with the act, please reach out to any of Greensfelder’s Health Care attorneys.