Federal judge again sides with Texas Medical Association in dispute with HHS over No Surprises Act
"The decision will promote patients' access to quality care when they need it most," says Dr. Gary Ford, president of the Texas Medical Association.
The arbitration process between out-of-network providers and payers under the No Surprises Act received another setback in a Texas court this week.
The case pitted the Texas Medical Association and medical providers nationwide against the U.S. Department of Health and Human Services. U.S. District Judge Jeremy Kernodle ruled that the revised arbitration process “continues to place a thumb on the scale” in favor of insurers and that “the challenged portions of the final rule are unlawful and must be set aside.”
The 2020 No Surprises Act protects patients from unexpected medical bills and limits how much they can be charged for emergency and nonemergency services from out-of-network providers. It also established an arbitration process for when payers and providers disagree about those rates.
Under an interim final rule unveiled in July 2021, the Centers for Medicare & Medicaid Services directed the arbitrator in the independent billing dispute resolution process to assume that the qualifying payment amount, or the median in-network rate set by payers, is the appropriate out-of-network rate for final payment determination.
The Texas Medical Association challenged the rule, alleging that CMS failed to follow clear direction from Congress about implementing the dispute resolution process. A federal judge agreed and ruled against the administration in February 2022, a decision that was appealed by HHS in April. CMS released a revised final rule in August that the association claimed still gave too much of an advantage to payers during arbitration.
“Similar to before, the new final rules unfairly advantage insurers by requiring arbitrators to give outsized weight or consideration to an opaque, insurer-calculated amount — called the qualifying payment amount — when choosing between an insurer’s offer and a physician’s offer in a payment dispute,” says Dr. Gary Ford, president of the Texas Medical Association. “This is unfair to physicians, providers and the patients we care for, so we had to seek fairness.”
In the latest decision, Kernodle vacated all of the revised regulations challenged by the association, including the rule that arbiters must primarily consider the qualifying payment amount.
Read more: No Surprises Act prevented more than 2 million unexpected medical bills
“The decision will promote patients’ access to quality care when they need it most and help guard against health insurer business practices that give patients fewer choices of affordable in-network physicians and threaten the sustainability of physician practices,” Ford says.