Federal Agencies Finalize Independent Dispute Resolution Regulations Implementing No Surprises Act

The DOL, HHS, and IRS have finalized portions of the regulations concerning the independent dispute resolution (IDR) process of the No Surprises Act. The agencies also have provided a fact sheet summarizing the finalized regulations. Congress enacted the No Surprises Act as part of the Consolidated Appropriations Act of 2021 (CAA) to address various issues involving surprise medical billing. The major aim of the legislation is to protect consumers from surprise bills from out-of-network emergency and non-emergency services, including air ambulance services. 

The three federal agencies issued two sets of interim final regulations that addressed various issues. A federal trial court invalidated certain portions of the regulations that prioritized the qualifying payment amount (QPA) over other factors in determining the payment amount for certain services covered by the Act. 

As a result, the highlights of the final regulations that the three agencies include:

  • Removal of the portions of the regulations that the federal trial court invalidated, in that the regulations no longer prioritize the QPA over other factors in determining the payment amount for certain services; 
  • A provision specifying that certified IDR entities should select the offer that best represents the value of the item or service in dispute. In considering the offers, these entities should consider the QPA, and all other permissible information submitted by the parties. The regulations do not create a presumption that the QPA is the appropriate out-of-network rate;
  • Addition of new disclosure requirements for plans and insurers that “downcode” a billed claim, alter a service code to another code, or alter, add, or remove a modifier if the changed code or modifier is associated with a lower QPA than the code or modifier billed by the provider or facility; and 
  • The plan or insurer must explain the reason for downcoding the item, including a description of the altered codes or modifiers and what the QPA would have been without the downcoding. 

The agencies note that the final regulations address only issues crucial to the implementation of the IDR process. Accordingly, they intend to finalize the remaining interim final regulations later.

HBL has experience in all areas of benefits and employment law, offering a comprehensive solution to all your business benefits and HR/employment needs. We help ensure you are in compliance with the complex requirements of ERISA and the IRS code, as well as those laws that impact you and your employees. Together, we reduce your exposure to potential legal or financial penalties. Learn more by calling 470-571-1007.

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Hall Benefits Law, LLC

HBL offers employers comprehensive legal guidance on benefits in mergers and acquisitions, Employee Stock Ownership Plans (ESOPs), executive compensation, health and welfare benefits, healthcare reform, and retirement plans. We counsel a wide spectrum of clients including small, mid-sized, and large companies, 401(k) investment advisors, health insurance brokers, accountants, attorneys, and HR consultants, just to name a few. HBL is passionate about advising clients, and we are dedicated to our mission: to provide comprehensive, personalized, and practical ERISA and benefits legal solutions that exceed client expectations.

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