New Regulations on “Surprise” Emergency and Out-of-Network Medical Billing

The first of several regulations implementing the No Surprises Act of 2020 (H.R. 133) has been issued by the Departments of Health and Human Services, Labor, and Treasury, and the Office of Personnel Management. The Final Interim Rule, titled Requirements Related to Surprise Billing; Part I aims to reduce “surprise” bills and unexpected balance billing. The provisions of this rule will begin to go into effect on January 1, 2022.

Who Is Covered?

This Rule applies to protect individuals who obtain their health coverage from through an employer, the federal marketplace,  a state-based Marketplace, or directly through an issuer of individual market health insurance. The requirements and limitations under the Rule apply to health plans as well as a variety of health care facilities and providers.

What Is Covered?

This Rule addresses surprise bills in numerous ways.  First, if a health plan provides emergency health benefits, then emergency services must be covered regardless of whether the health facility is in-network or out-of-network. Additionally, this coverage must be provided without prior authorization.

Second, the Rule limits cost-sharing for out-of-network services and requires that cost-sharing “count toward any in-network deductibles and out-of-pocket maximums …” The Rule includes additional guidelines for determining consumer cost-sharing amounts and payments to out-of-network providers and facilities.

Third, if a patient receives care at an in-network facility from an ancillary provider who is out-of-network, the out-of-network provider cannot charge the patient out-of-network rates (i.e., the out-of-network provider must instead charge in-network rates). For example, if a patient goes to a hospital which is in-network, but the anesthesiologist who cares for the patient is out-of-network, the patient cannot be billed for out-of-network rates for the anesthesiologist, but instead must be charged in-network rates.

Fourth, certain health care providers and facilities (e.g., emergency departments of hospitals, freestanding emergency departments, hospital outpatient departments and certain ambulatory surgical centers) must give patients a one-page notice explaining:

  • Balance-billing prohibitions;
  • Any applicable state balance-billing limitations; and
  • Contact information for patients to report actions that the patient believes may have violated the requirements explained in the notice.

Next Steps

The Rule also announces the Biden Administration’s intention to release further regulations to continue to implement the No Surprises Act. Later in 2021, the Administration expects to release regulations about price comparison tools, transparency-related patient protections, patient-provider dispute resolution and a federal independent dispute resolution (IDR) process.

Additional rules are expected to be issued after January of 2022 that cover plan and insurance identification card transparency, continuity of care, accuracy of provider network directories and a prohibition on gag orders.