Kaitlin Howard

By Kaitlin Howard

Kaitlin Howard is a researcher and writer producing insightful content across the healthcare revenue cycle. She has written and produced content for Zelis, Waystar, and Recondo Technology, as well as agencies. With a B.A. in English and Writing from University of Denver, Kaitlin stays current on market updates on claims management and healthcare payments, publishing a regular educational blog series on industry trends and Zelis offerings.

Zelis ​​Chief Legislative Affairs Officer Matthew Albright was recently invited to speak on a panel at the annual Future of Healthcare Policy Summit hosted by Capstone, a regulatory and due diligence organization. Throughout the panel, he discusses the No Surprises Act (NSA) in great detail, including the good faith estimate, digitization of information, arbitration process, and overall price transparency.

We’ll discuss the highlights below; you can find the full discussion here.

Usually when we talk about the No Surprises Act, when we talk about surprise balance billing, we’re talking about a small segment of claims and really an even smaller segment of providers . . . But the transparency requirements of the No Surprises Act apply to all providers.”

Matthew Albright

If you think about the transparency policy initiatives in general, not just what showed up in the NSA, you’ll begin to see a pattern. That pattern? “Freeing up data,” which will inevitably create a tremendous impact on all of healthcare (e.g., pricing, reimbursement, business models, network negotiations).

In fact, over the next five to 10 years, we could see a large shift. For example, third parties may potentially come in, sort through the data, and make it more usable for consumers, further monetizing the industry.

The No Surprises Act (NSA)

Signed into law on December 27, 2020, the NSA represents a significant change in the way out-of-network providers can bill and be reimbursed for certain out-of-network services.

The original goal of the act was to eliminate medical bills for out-of-network care the patient did not knowingly choose (e.g., in the case of a medical emergency). Also known as surprise balance billing, these bills charge patients directly for the part of the bill not covered by insurance.

This new legislation prohibits providers from balance billing members in three circumstances:

1. Out-of-network emergency items and services

2. Out-of-network nonemergency items and services provided in in-network facility

3. Out-of-network air ambulance healthcare items and services

Seems pretty straightforward. But what caught Matthew’s attention were the specific transparency requirements.

The Good Faith Estimate (GFE)

The NSA includes a provision requiring a good faith estimate (GFE) be provided to any patient presenting either with no insurance or choosing not to bill insurance for the visit. But in a recent FAQ, the Centers for Medicare & Medicaid Services (CMS) clarified that this provision is actually applicable to all providers in all settings, and the American Dental Association (ADA) confirmed that the GFE requirement even applies to dentists.

Meaning: A GFE must now be given to all uninsured patients, as well as patients who have insurance but are electing not to use it for these services.

Perhaps the most surprising part of this requirement is that GFEs must be given for every appointment a patient schedules or when requested, as the estimate is meant to be used by the consumer as a comparison tool to guide decisions about choosing a healthcare provider.

The good faith estimate must be provided in writing no later than three business days after an appointment is scheduled (in most cases) and information regarding the availability of the good faith estimate must be in accessible formats for all patients.

A good faith estimate requires the following components:

  1. Patient name and date of birth
  2. Clear description of service and date scheduled (if applicable)
  3. List of all items and services (including those to be provided by co-providers)
  4. CPT code, diagnosis code, and charge per item of service
  5. Name, NPI, and TIN of all service providers and the state where the services will be rendered
  6. List of items from other providers that will require separate scheduling and subsequent billing

What if the good faith estimate is incorrect?

As noted in the law itself, the GFE may not include charges for unanticipated items or services that are not reasonably expected or occurring due to unforeseen events. If a patient’s needs are ultimately different from what was expected (typically around a difference of $400 or more), a provider must update the GFE prior to the appointment or the patient may later trigger the patient-provider dispute resolution process.

The Arbitration Process

Prior to passage of the NSA, Congress considered different proposals that either included a specific benchmark for reimbursement or included arbitration instead. As such, to Matthew, the law ultimately passed by Congress was a sort of compromise because it had both an arbitration process and a benchmark that would be considered among other factors during the arbitration.

However, the regulation that later clarified the arbitration process mandated that the benchmark be the primary factor that is considered in the arbitration.

Under the NSA’s process, a health plan reimburses the provider with an initial payment. But the Act does not require that the reimbursement be a specific rate.

If the provider does not like the payment amount, the provider has 30 days to negotiate a different amount with the health plan. If the negotiation fails, then either party may invoke arbitration. After both parties submit a proposed payment for services, the arbitrator must select either the provider or the health plan’s rate, with no ability to split the difference between the two proposals.

The arbitrator must also choose the proposal that is closest to the benchmark – generally, the in-network rate – and only consider other factors if they have a demonstrably direct bearing on the cost of the healthcare. The losing party must pay for the arbitration.

Unforeseen Impacts of NSA

Even the smallest changes in policy can have a major influence on the current industry. And, according to Matthew, we’re already seeing some of that impact.

When the NSA was first announced, there were a lot of discussions centering around the possible ramifications for out-of-network providers. But now it seems that the script is flipping, depending on where you are in the country.

Just like it may not be in providers’ best interest to be out-of-network (thanks to the NSA), in some areas, it may now be of no use to be in-network.

Why? With the expectations for out-of-network, in-network anticipated rates have droppedBecause arbitration of out-of-network NSA claims is now tied to in-network rates, as per the regulations (and pending some lawsuits!) Some providers may find they are guaranteed to get paid more under the NSA benchmark than they do by being in-network.

And with the regulation’s attempts to “even out” payments between in-network and out-of-network, over the next few years, the entire idea of “network” may just disappear altogethermay lose its current meaning. .

The Wrap Up

The NSA specifically addresses the surprise billing problem within the healthcare market, but it also presents new challenges and opportunities for substantial industry change.

If you’re interested in discovering how Zelis is using its market-leading claims cost management and payments optimization solutions to address these new requirements, visit our Info Hub here.
And, once again, if you’re interested in hearing the whole discussion, here’s the link.