The No Surprises Act, signed into law at the end of 2020 and implemented in 2022, was designed to curb a practice known as “balance billing” that resulted in surprise medical bills. Those bills created unforeseen financial burdens on patients who received medical care from an out-of-network provider or facility, often without the patient’s knowledge or notice by the facility/provider that the visit would result in additional charges.
As part of the No Surprises Act, self-funded group health plans and insurance issuers (collectively, “payers”), and health care providers and facilities (“providers”) must participate in a federal independent dispute resolution (IDR) process when out-of-network providers and payers cannot agree on appropriate claim payments. A proposed rule addressing IDR was published in November 2023 but created challenges in implementation and produced significant litigation, making the IDR process difficult to navigate. This final rule, which will be effective 60 days after it is published in the Federal Register, attempts to create consistency and uniformity for parties navigating claims through the IDR process.
Group health plans comprised only of “excepted benefits,” such as stand-alone dental and vision plans, excepted benefit HRAs, and most health FSAs, are not subject to the No Surprises Act or the IDR process.
Under the final rule, the Departments state their intent to create an IDR process registry and will require all plans and issuers, including self-funded group health plans, to submit to the registry certain information and obtain a registration number. Plans will be required to register within 90 days of the creation of the registry, or within 90 days of establishing a new group health plan (if later). Also, plans would need to update any applicable information in the registry within 30 days of a change to plan information and recertify the accuracy of the data annually in the fourth quarter of each calendar year.
Legal business name of the plan and/or self-funded group health plan sponsor;
Whether the plan is subject to ERISA, or is a governmental or church plan;
For self-funded governmental and church plans, whether they are subject to an All-Payer Model Agreement or have opted into specified state laws, and for governmental plans only, the state(s) in which the plan is offered;
Contact information for the plan (this can be a TPA), including a contact who can initiate open negotiation of payments and a contact who can initiate the IDR process on behalf of the plan (plans using multiple contacts, such as different TPAs by location, must provide a consolidated open negotiation contact to triage external requests);
The plan’s 5-digit HIOS identifier or the plan/plan sponsor’s EIN and plan number;
Other information relevant to identifying the plan and specified federal or state requirements for determining out-of-network rates (mostly applicable to federal governmental plans or issuers); and
Other information that may be necessary for the purposes of administrative fee collection
The federal IDR registry created by the final rule will be a searchable database that will help identify the proper payers who are initiating a dispute or against whom a dispute is initiated. Insurance issuers will be able to register once on behalf of all plans they insure, but employer plan sponsors will be required to register separately for each self-funded group health plan subject to the IDR process.
The Departments will announce when the IDR registry becomes available to registrants and the deadline for registration (which should occur 90 days from that date).
Either a payer or a provider can initiate the IDR process with an open negotiation notice to the other party. The final rule requires that the notice include certain identifying information about the provider, the type and nature of the item or service (e.g. whether it is an emergency or non-emergency service, whether it is a professional service or facility-based service), the location of the service and where it was rendered, the claim number, service code, and information about the initial payment amount and a proposed out-of-network rate. The notice must also properly identify the payer, including the payer’s IDR registration number. If a payer does not provide its IDR registration number on any remittance advice, the party submitting the open negotiation notice must attest that the payer’s registration number was not provided.
If the party initiating the open negotiation notice is a payer, including a group health plan, the notice must also include the qualifying payment amount (QPA) provided with the initial payment/denial of payment or a later adjustment to that amount with documentation, and the amount of cost-sharing imposed for the item or service. All remittance advice associated with the initial payment or notice of denial for the item or service must be included with the notice, along with a copy of the initial payment/denial.
Along with the information outlined above, an open negotiation notice submitted by a TPA on behalf of a group health plan must include the TPA’s contact information and an attestation by the TPA that it has the authority to act on behalf of the group health plan. If an open negotiation notice is initiated by or on behalf of a group health plan, the notice must include the legal name of the self-funded group health plan sponsor (typically the employer sponsoring the group health plan) if the plan does not have a legal business name.
Employers sponsoring fully insured health plans are unlikely to experience any changes as a result of the final rule, as the burden to register falls squarely upon their insurance carrier. However, for employer sponsors of self-funded group health plans, the final rule explicitly allows a third party to complete registration on behalf of a group health plan, and we expect most TPAs will fulfill this requirement for the group health plans they administer.
Therefore, we recommend self-funded employer plan sponsors discuss with their TPA(s) any information the TPA will require the employer to review or provide to the TPA, and confirm the TPA will be prepared to:
Register the employer’s group health plan within 90 days of the IDR registry becoming available,
Update such registration within 30 days upon any change to the plan information contained within the registry, and
Confirm the accuracy of plan information on behalf of the group health plan in the fourth quarter of each calendar year
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