Enough With the 'No Surprises Act' Scheming
A new report from CMS on the No Surprises Act’s (NSA) independent dispute resolution (IDR) process provides staggering details. Notably, from April 15, 2022 until this past March 31, 334,828 IDR claims were initiated. Compare that number to the Biden administration’s estimate “that there will be approximately 17,000 claims that are submitted to the Federal IDR process each year.” Despite this completely incompetent forecasting (see here for Rep. Michael Burgess (R-TX) reminding HHS Secretary Xavier Becerra that Texas alone had 45,000 claims for its state IDR process in its first year before the No Surprises Act was even in effect), something else is afoot upon reading the report further.
As I recently commented in Bloomberg Law, the report’s data shows that, for the benefit of health insurance companies, CMS is trying to destroy the nation’s independent medical practices that still remain open. Moreover, this report is proof that CMS’ regulatory implementation and operation of the IDR process to date are unlawful. How do we know about this scheming?
Unfortunately, all signs from the report, as well as in court and medical offices nationwide, point to the Biden administration using its NSA regulatory implementation to crush independent physicians.
CMS’ report notes that, of the more than 334,000 IDR claims, just 42,158 payment determinations have been made by certified IDR entities, the organizations accredited by CMS to decide these disputes. That’s a mere 12.6 percent. The NSA clearly states that payment determinations for each claim must be made within 30 days. Thus, regulators’ blatant disregard for the law by delaying a vast amount of IDR claims is evident.
What does CMS have to say about this? The agency states “the primary cause of delays in the processing of disputes is the complexity of determining whether disputes are eligible for the federal IDR process.” This claim gets five Pinocchios. IDR eligibility is not some incredibly complicated calculation. In fact, it couldn’t be simpler: out-of-network medical services performed after January 1, 2022 at in-network medical facilities are eligible. The only real issue is determining the appropriate IDR venue, as some states have a state IDR process, too. This easily could be clarified by health insurance companies in their explanation of benefits (EOB) statements with a few simple questions. For example, is the plan regulated at the state or federal level?
The Biden administration, however, is allowing health insurance companies to claim – many times erroneously – a large number of claims as ineligible. CMS’ report notes that eligibility challenges were lodged for 122,781 disputes. This is an insurance company tactic to further delay making payments for which they are on the hook. Physicians are then forced into a never-ending blackhole of trying to communicate further with the IDR entities, many of whom are slow to respond. When they do, their guidance is often wrong or incomplete.
To the courtroom, followers of this critical healthcare issue know that the Texas Medical Association (TMA) has prevailed against HHS and CMS in two consecutive federal court cases (TMA I and TMA II). A judge in Texas’ Eastern District Court vacated the unlawful portions of the agencies’ regulations. Instead of complying with the court order and fixing the regulatory language that illegally skewed the IDR process in health insurers’ favor, the Department of Justice appealed the TMA II ruling last month. This action is simply a ruse to shield Secretary Becerra from answering any of Congress’ further questions on the administration’s failed regulatory implementation.
This scheming is now even problematic because when a physician or medical department wins an IDR case and the health insurance company loses, the insurers are failing to make the appropriate payment – again, as required by the law. There has been zero enforcement from HHS or other federal agencies regarding this non-compliance. Again, how do we know this?
A recent study released by the Emergency Department Practice Management Association (EDPMA) analyzed almost 220,000 outstanding IDR claims. It discovered that an astonishing 87% of health insurance companies did not pay in accordance with the IDR entity’s decision. In a further breakdown of the survey’s respondents, one-third reported 100% non-compliance by insurance companies and another one-third reported non-compliance from 89% to 98% of the time. This unlawful behavior must be checked by HHS immediately.
As spelled out in the agencies’ own regulations in July 2021, the NSA “requires rulemaking to establish a process under which group health plans and health insurance issuers offering group or individual health insurance coverage are audited by the applicable Secretary or applicable state authority to ensure that such plans and coverage are in compliance…” We have yet to see a single audit from regulators. Yet again, more scheming.
Secretary Becerra recently testified before Congress, where he was asked repeatedly about NSA implementation. Dr. Richard Heller captured what happened next in a recent MedPage Today column. One of the secretary’s responses was mindboggling. “He implied medical providers are to blame, commenting that most of the disputes being submitted for arbitration appear to be ‘frivolous.’ Becerra did not provide data to support this statement, nor did he explain why a physician would submit a frivolous dispute, as the non-prevailing party in arbitration must pay the arbiter's fee.” The CMS report notes in its last section that, of the 42,000-plus payment determinations made thus far, physicians (i.e., the “initiating parties”) won approximately 71% of the IDR disputes. We wonder if Secretary Becerra thinks the 71% of the disputes that physicians have won are frivolous.
Similarly, CMS Administrator Chiquita Brooks-LaSure provided fellow Democrat Rep. Raul Ruiz (D-CA) this non-answer when he questioned her on NSA implementation during her recent Congressional testimony.
Decisions on the next two Texas Medical Association federal court cases against HHS, CMS, and other agencies (TMA III and TMA IV) could come as soon as June. In the meantime, some legislators are already hinting at the possibility of introducing new legislation to stop the scheming. According to Rep. Greg Murphy (R-NC), "If their whole modus operandi is to continue with this absolute unilateral interpretation of the law…then we'll have to put another law in. We're playing a little bit of a waiting game for the next few months now that it's being litigated again. But honestly, by mid-summer, if it's not fixed, we're gonna have to start over again [with new legislation]. It's ridiculous.” Would new legislation fall victim to the same regulatory scheming destroying the NSA? We wish there was a good answer.
But there’s an immediate solution. President Biden announced his re-election campaign with the slogan “Finish the Job.” Well, he can do one important job right now: instruct HHS and his other agencies to fix the mess that is NSA implementation. If the IDR process is not up and running quickly, and health insurance companies continue to stymie the system and not make payments, thousands of medical practices nationwide will soon be out of business. All of us as patients will then be left holding the bag.
Christopher Sheeron is president of Action for Health.
