Major Delays For No Surprises Act Arbitration Cases

July 1, 2022
Hall Benefits Law, LLC

In mid-April 2022, the U.S. Department for Health and Human Services (HHS) officially opened its out-of-network payment dispute resolution portal under the No Surprises Act. This portal is the mechanism that many providers and payers must use to settle cases in certain circumstances. Some states have set up their own dispute resolution processes, and self-insured plans in those states must use the HHS portal, unless they have opted into their state’s process. 

Parties utilize the portal when the No Surprises Act prohibits balanced billing and the parties cannot agree on the appropriate payment for the outstanding amount. When required, the parties participate in an arbitration process through the portal known as independent dispute resolution, or IDR. 

Court Ruling Causing Extensions to Timeframes for IDR Cases

A February court ruling delayed the initial launch of the HHS portal and now is threatening to create major delays for parties with disputes who already have begun using the portal. As HHS works to make regulatory adjustments to comply with the court ruling, the 30-business-day negotiating period has expired for hundreds of cases, which will cause an influx of cases moving to IDR. Arbitrators are supposed to issue decisions within 30 business days of their selection. Still, it is likely that extensions of these timeframes will occur, at least until HHS issues a modified rule. 

Although HHS has appealed the court ruling, it is still proceeding to draft an amended rule to comply with the court order. Accordingly, the court recently granted HHS’s request to pause its appeal while it finalizes the amended rule.  

Interim Guidance Allows Additional Criteria Mirroring No Surprises Act

HHS has also issued interim guidance to IDR entities to consider additional information in deciding the final payment obligation, so long as the information is credible. HHS now specifically authorizes IDR entities to consider evidence such as:

  • The provider’s training level, experience level, and quality and outcomes measurements;
  • The provider’s market share;
  • The patient’s acuity or the complexity of the patient’s condition;
  • The provider’s teaching status, case mix, and scope of services; and
  • Good-faith efforts (or lack thereof) made by the parties to enter into a network agreement.

Previously, HHS had directed IDR entities to focus on the qualifying payment amount (QPA), or the health plan’s median contracted rate for similar items or services in the same geographic region, to determine the final payment obligation. Both parties in Congress have been critical of the previous guidance and have asked HHS to formalize the interim guidance in a final rule. 

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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