The U.S. Department of Health and Human Services’ Centers for Medicare & Medicaid Services (CMS), the Office of Personnel Management (OPM), the Department of Treasury’s Internal Revenue Service (IRS), and the U.S. Department of Labor’s (DOL) Employee Benefits Security Administration (EBSA) have issued a proposed rule on the federal Independent Dispute Resolution (IDR) process under the No Surprises Act (NSA). The rule will be published in the Federal Register on November 3, 2023.
The proposed rule involves new requirements for group health plans and insurers, providers, and facilities for air ambulance services and certified IDR entities under the federal IDR process. The goal of the federal agencies that proposed the rule is to improve the overall functioning of the process and reach more timely payment determinations. Finalizing the proposed rule would improve communication between the parties to the process, change timelines and steps of the process, establish new batching provisions, create more efficiencies, and modify the administrative fee structure to create better accessibility.
Improving Communications
The exchange of critical information between the payer and provider early in the process helps them determine whether to contest the initial payment or notice of denial of payment and assess whether the federal IDR process would be an eligible means of resolution. However, payers and providers have expressed difficulties communicating and obtaining key information to these disputes. As a result, the federal agencies propose that payers provide additional key information when they issue the initial payment or notice of denial of payment. Payers also would communicate information to providers using specific claim adjustment reason codes (CARCs) and remittance advice reason codes (RARCs) when providing remittance advice to entities with whom they have no contractual obligations. Further agency guidance would identify these specific CARCs and RARCs.
Changing Timelines and Steps of the Process
The purpose of the open negotiation period is to resolve some disputes without the expense involved in IDR, exchange information, and assess the appropriateness of IDR. The agencies also have proposed various changes to the open negotiation requirements in response to feedback that parties are not meaningfully engaging in negotiations as required before entering the IDR process. These changes include:
- Requiring a party to provide a notice to the other party and the agencies through the federal IDR portal to initiate the open negotiation period;
- Starting the 30-day open negotiation period as of the date that a party issues the open negotiation notice and a copy of the remittance notice or notice of denial of payment to the other party; and
- Mandating that the open negotiation notices contain several new content elements.
The agencies also propose establishing an open negotiation response notice. The party receiving the open negotiation notice must furnish the response notice to the other party by the 15th day of the 30-day open negotiation period.
Establishing New Batching Provisions
The NSA and the regulations interpreting the NSA allow initiating parties to include multiple items or services as separate payment determinations in a single dispute or as so-called “batched disputes.” Batching increases efficiency and reduces costs for disputing parties.
In the proposed rule, the agencies provide new rules to address when batching is appropriate or when qualified IDR items relate to treating a similar condition and encourage efficiency. More specifically, batching is appropriate in the following circumstances:
- When items and services are furnished during a single patient encounter;
- Items and services are billed under the same service code or a comparable code under a different code system; and
- Anesthesiology, radiology, pathology, and laboratory items and services billed under services codes belonging to the same Category code section, to be specified in guidance by the agencies.
Furthermore, the proposed rule would limit batched determinations to 25 qualified IDR items or services in a single dispute.
Creating More Efficiencies
The agencies have determined that assessing whether a dispute is eligible for the federal IDR process creates significant time-consuming delays, exacerbated by the fact that the NSA provides no set timeframe for completing this assessment. As a result, the proposed rule provides that certified IDR entities must determine eligibility within five business days of final certified IDR entity selection and notify both disputing parties and the agencies. To the extent that additional information is requested, parties must submit it to certified IDR entities or the agencies within five business days of the request.
In the proposed rule, the agencies also intend to establish an eligibility review process to resolve eligibility determinations during systemic delays or extenuating circumstances. Before this review process takes effect, the agencies would provide advance public notice of the date on which the review would commence and the reasons for the review.
Modifying the Administrative Fee Structure and Creating Better Accessibility
Both parties to a dispute must pay a non-refundable administrative fee to ensure the financial sustainability of the federal IDR process. However, under the proposed rule, the agencies would collect these fees from the disputing parties directly rather than the certified IDR entities collecting the fees on behalf of the agencies.
Furthermore, the initiating party to a dispute would be required to pay the fee within two business days of the date that a certified IDR entity is selected, and the non-initiating party would be required to pay the fee within two business days of receiving notice of an eligibility determination. Failure to pay either fee would result in the closure of the case. If the initiating party failed to pay the fee, the non-initiating party would not owe a fee. On the other hand, if the non-initiating party failed to pay the fee, the debt collection procedure of the federal IDR process, which is yet to be established, would go into effect.
Finally, to ensure accessibility to the federal IDR process, the proposed rule provides for a reduced fee for both parties when the highest offer made during open negotiation by either disputing party is less than a certain threshold. Likewise, the non-initiating party would owe a reduced fee if the certified IDR entity or the agencies determined the dispute to be ineligible for the federal IDR process.
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