Emergency departments are a chaotic environment — and that’s on a good day! Physicians and other healthcare professionals working in these areas handle approximately 131.3 million patient visits annually, often while dealing with staffing shortages, a lack of available beds and an increasing number of substance abuse and mental health concerns.
Emergency department (ED) visits account for 11% of outpatient encounters, 28% of acute care visits and half of hospital admissions. Post COVID-19 pandemic patient volume continues to increase, leading to more overcrowding, which has been associated with higher morbidity and mortality, delayed pain control, delayed time to administration of antibiotics, increased medical errors, and less-than-optimal health care.
As if that’s not enough, many emergency medicine groups are encountering issues with the No Surprises Act (NSA). So much so that it was the hot topic at the Emergency Department Practice Management Association (EDPMA) 2023 Solutions Summit earlier this year which members of the ImagineSoftware team attended in Las Vegas, and no doubt, will have a continued impact on conversations during the upcoming American College of Emergency Physicians (ACEP) Scientific Assembly in Philadelphia from October 9th – 12th, 2023.
The Legislation Lowdown
It’s no surprise: the rollout and execution of the No Surprises Act (NSA) have not gone without problems. Signed into law on December 27, 2020, this bipartisan and bicameral legislation that went into effect on January 1, 2022, which applies to all individual and group health plans, including self-insured plans, is designed to curb surprise medical billing, save patients money and reduce overall health insurance premiums.
How? By changing the reimbursement process for claims identified as surprise bills. In the case of reimbursement disputes, healthcare providers and payers have the right to access an independent dispute resolution (IDR) process.
The NSA created new protections for 177 million Americans with private health insurance. Healthcare consumers in the United States are fed up with unexpectedly high medical bills, especially when the services they received occurred in an emergency or through an out-of-network provider. According to one poll, 65 percent of insured adults were at least “somewhat worried” about unexpected medical bills.
One of the problems with the NSA is the case backlog. According to an April 2023 status update from the Centers for Medicare & Medicaid Services (CMS), a total of 334,828 billing disputes had been filed between April 15, 2022 and March 31, 2023. That’s 14 times more than the government agency initially expected! A more recent CMS update noted that disputing parties initiated over 46,000 disputes through the federal IDR portal between April 15th and August 11th. 2023.
Data analysis from the EDPMA shows that 91% of filed claims remain open and unadjudicated and 95.6% of IDR claims have been pending for more than five months. The EDPMA also found that 87% of payers did not pay in accordance with the IDR Entity Decision.
The EDPMA is not the only organization sounding alarms about inefficiency of the No Surprises Act. A survey of 48,005 physicians in 45 states conducted by Americans for Fair Health Care (AFHC) reveals the following:
- Roughly half of payments determined by IDR entities were not made in the required 30-day timeframe, and 33% were made in an incorrect amount
- Approximately 35% of in-network contracts have been terminated, with payers citing NSA as the reason.
- One hundred percent of providers have been threatened with contract termination 16 times, on average.
- On average, it has taken 236 days overall for a payment dispute to be resolved and paid.
At least 16 lawsuits have been filed challenging the NSA, the implementation of its regulations and the IDR decision process. Such litigation spurred some organizations to form the Coalition Against Surprise Medical Billing, which primarily represents employer groups, unions and health insurance providers.
The Texas Medical Association NSA Lawsuit Timeline
The NSA lawsuits receiving the most attention have been filed by the Texas Medical Association, the U.S.’ largest state medical society. The TMA comprises more than 57,000 physician and medical student members.
The first lawsuit the TMA filed against the NSA occurred in October 2021. What was the reason for it? The state medical society argued that reliance on the NSA’s qualifying payment amount (QPA) fails to allow arbitrators to exercise discretion and weigh other relevant factors. On February 23, 2022, a federal judge sided with the TMA by ruling that the challenged portions of the Final Rule were unlawful and must be set aside under the Administrative Procedure Act (APA).
Lawsuit number two from the TMA against the Departments of Health and Human Services, Labor and the Treasury, this one filed in September 2022, contented that NSA mechanisms for arbitrating payments unfairly favored insurers. On February 6, 2023, a U.S. District Judge sided with the TMA’s argument. The judge also vacated provisions of a final rule on the arbitration process under the NSA and remanded it back for further consideration.
Next was lawsuit three, in which the TMA challenged through a November 30, 2022, filing certain parts of the rules that artificially deflate the QPA. Less than one month ago, on August 24, 2023, a federal court handed the TMA another victory by ruling that certain provisions of the QPA formula were invalid and must be rewritten.
The fourth NSA lawsuit filed by the TMA, this one on January 31, 2023, challenged the 600 percent hike in administrative fees when seeking IDRs. The fees increased substantially from $50 to $350 at the start of 2023. In the filing, the TMA also argued against rules limiting the “batching” related claims in a single IDR dispute.
On August 3, 2023, the judge ruled that federal agencies did not follow notice and comment requirements when spiking administrative fees. He also invalidated certain rules narrowing batching claims for arbitration. On August 11, 2023, CMS lowered the IDR fee to $50.
In the most recent update to the NSA challenge saga, the CMS directed certified IDR entities to proceed with eligibility determinations for single and bundled disputes submitted on or before August 3, 2023. According to the CMS, disputing parties may continue to engage in open negotiation, but all other aspects of Federal IDR process operations remain suspended.
Reimbursement Issues Resulting from the NSA
Although the goal of the NSA is admirable, gaps in the legislation leave some individuals vulnerable to continued surprise bills. Factors such as a higher-than-expected number of IDR disputes, complexities in determining eligibility of disputes under the NSA and significant technical issues with the IDR portal have resulted in IDR decisions in only a small fraction of the disputes initiated to date.
Another problematic component of the NSA that presents reimbursement challenges is the use of service codes, which don’t include revenue codes. Therefore, providers are forced to utilize only service codes, resulting in emergency medical groups and other providers losing additional costs for which the IDR does not currently account.
Then there’s the lack of an enforceability mechanism for payments once the IDRE has rendered a binding determination. Healthcare payers have consistently refused to pay providers after a determination has been rendered.
Proactively Combat Billing and Reimbursement Issues with ImagineSoftware
Running a successful emergency medicine group requires a lot of responsibility — including staying up to date on legislation and trends affecting the healthcare industry. Understanding the ins and outs of the No Surprises Act and all its changes is no different.
On-Demand Webinar: No Surprises Here - ImagineSoftware's No Surprises Act Solutions
At ImagineSoftware, we keep NSA-specific workflows on the forefront to enable emergency medical groups and other provider organizations to automate the process and track associated timelines by state. We offer proactive solutions, including an end-to-end billing platform with seamless patient payment portal, prior authorization, eligibility, patient estimation tools, and more – like customizable reporting and patient experience-increasing features.
On-Demand Webinar: ImagineInsights - Contract Management to Combat NSA