Xavier Becerra, former HHS Secretary, testified before Congress and was questioned about the implementation of the No Surprises Act. The Act was passed in 2020 to prevent surprise medical bills and ensure fair negotiations between insurance companies and healthcare providers. However, there have been many challenges with its implementation.
Senator Michael Bennet criticized the implementation process, noting that even when medical practices win in arbitration, insurance companies are not paying providers consistently. Additionally, the backlog of arbitration cases has resulted in some practices waiting over six months for payment. Becerra responded by implying that medical providers were responsible for the backlog, saying that most of the disputes being submitted for arbitration were “frivolous.” However, he did not provide any data to support this statement.
The Departments of HHS, Labor, and Treasury were charged with implementing the Act, which uses arbitration to balance out-of-network reimbursement. However, this process has led to many lawsuits and the government’s own report has described it as “overwhelmed and struggling.” Several reasons have been identified for the issues.
Accessing Arbitration and Unbalanced Arbitration
Becerra claimed that the large number of dispute submissions is due to the fact that there is no cost to file a claim. However, the Texas Medical Association filed a lawsuit after the administration increased the non-refundable fee to access arbitration by 600%. Additionally, creating and submitting a dispute incurs costs for healthcare providers.
The Departments’ report stated that the main cause of delays in the arbitration process is the difficulty determining claim eligibility for the federal arbitration process. The Departments have not required insurers to indicate this eligibility initially, leading to inefficient processes.
The No Surprises Act requires several factors to be considered when arbiters make decisions between insurers and providers. One of these is the insurer’s median in-network rate, known as the qualifying payment amount (QPA). However, the calculation methodology does not result in market-based rates, and insurers calculate their own QPA, which may not be transparent. This has prompted lawsuits from the Texas Medical Association.
To improve the system, the arbitration process must be balanced. This can be done by removing unnecessary limits on the batching of claims and requiring insurers to indicate claim eligibility for federal arbitration. Additionally, the Departments should enforce timely and complete payment after an arbitration determination, as specified in the law, with penalties for non-compliance.
In conclusion, the No Surprises Act was designed to prevent surprise billing and protect access to care, but its implementation has been challenging. Hopefully, in the future, rulemaking will respect the balance reflected in the law and recent guidance, and the Act will provide better protection for medical practices and their patients.
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