The No Surprises Act and self-pay provisions

“No one should have to worry about going bankrupt after falling ill or seeking critical care.” – Xavier Becerra, Secretary, U.S. Department of Health and Human Services.

Secretary Becerra made the statement after the Assistant Secretary of Planning and Evaluation (ASPE) released a report with findings that “surprise medical bills are relatively common among privately-insured patients and can average more than $1,200 for services provided by anesthesiologists, $2,600 for surgical assistants, and $750 for childbirth-related care.” The ASPE report also indicated “that an estimated 18 percent of emergency room visits by individuals with large employer coverage resulted in one or more out-of-network charges, and this percentage varies greatly by state, ranging from a low of 3 percent in Minnesota to a high of 38 percent in Texas.” Self-pay patients are also affected by the No Surprises Act (NSA).

While The McCarran-Ferguson Act (15 U.S.C. § 1011) in general gives states the power to regulate the insurance industry, state insurance rules do not apply to self‐insured employee benefit plans (aka ERISA plans), which cover 67 percent of workers with employer‐sponsored health coverage.

Section 112 of the NSA and the implementing regulations (86 Fed. Reg. 55980 (Oct. 7, 2021)), address good faith estimates (GFE) of health care items and services for uninsured or self-pay individuals and the associated patient-provider dispute resolution process. First,

Section 112 of the No Surprises Act also adds PHS Act section 2799B-7, which directs the Secretary of HHS to establish a process under which uninsured (or self-pay) individuals can avail themselves of a patient-provider dispute resolution process if their billed charges after receiving an item or service are substantially in excess of the expected charges listed in the good faith estimate furnished by the provider or facility, pursuant to PHS Act section 2799B-6. Under PHS Act section 2799B-7, an uninsured (or self-pay) individual means, with respect to an item or service, an individual who does not have benefits for such item or service under a group health plan, group or individual health insurance coverage offered by a health insurance issuer, Federal health care program (as defined in section 1128B(f) of the Social Security Act), or a health benefits plan under chapter 89 of title 5, United States Code (or an individual who has benefits for such item or service under a group health plan or individual or group health insurance coverage offered by a health insurance issuer, but does not seek to have a claim for such item or service submitted to such plan or coverage).

In order to distill some of the fundamental aspects of these regulations, which apply to items or services scheduled or supplied after January 1, 2022, CMS published a helpful Frequently Asked Questions (FAQs). This section in particular should not be overlooked:

Q: Which providers and facilities are required to provide GFEs to uninsured (or self-pay) individuals?
A: Generally, all providers and facilities that schedule items or services for an uninsured (or self- pay) individual or receive a request for a GFE from an uninsured (or self-pay) individual must provide such individual with a GFE. No specific specialties, facility types, or sites of service are exempt from this requirement.

The terms “health care provider (provider)” and “health care facility (facility)” are defined in regulations for purposes of the GFE requirements for uninsured (or self-pay) individuals as:

• “Health care provider (provider)” means a physician or other health care provider who is acting within the scope of practice of that provider’s license or certification under applicable State law, including a provider of air ambulance services;

“Health care facility (facility)” means an institution (such as a hospital or hospital outpatient department, critical access hospital, ambulatory surgical center, rural health center, federally qualified health center, laboratory, or imaging center) in any State in which State or applicable local law provides for licensing of such an institution pursuant to such law or is approved by the agency of such State or locality responsible for licensing such institution as meeting the standards established for such licensing. 45 CFR 149.610(a)(2).

Notably, although facilities such as Long-term Care, Skilled Nursing, and Assisted Living facilities are not expressly stated, they are licensed by State institutions. Therefore, it appears as though these types of facilities also fall under the umbrella of the NSA, as it relates to self-pay, GFEs, and the dispute resolution process.

The American Hospital Association (AHA) supported the NSA and as AHA President Rick Pollack stated, “[n]o patient should fear receiving a surprise medical bill.” Although there are different processes between self-pay individuals and providers and providers and insurers in non-self-pay scenarios, one area to watch is the dispute resolution process, which is the subject of a jointly-lawsuit filed by the AHA and the AMA in the U.S. District Court for the District of Columbia. “That is why hospitals and health systems supported the No Surprises Act to protect patients and keep them out of the middle of disputes between providers and insurers. Congress carefully crafted the law with a balanced, patient-friendly approach and it should be implemented as intended.”

The best course of action for providers to take is to inform self-insured patients of GFEs and the dispute resolution process, update policies and procedures, and train staff.