No Surprises Act prevents more than 1M surprise billings monthly
Despite bottlenecks caused by higher than expected dispute resolution claims, the federal No Surprises Act appears to be living up to its name, according to a new survey by AHIP and Blue Cross Blue Shield Association.
“The number of those claims disputed by providers or facilities continues to outpace estimates,” the survey report said. “But data indicate that despite a high volume of claims being submitted to independent dispute resolution, the law’s components appear to be working to protect consumers and resolve payments.”
Most provisions of the Act took effect at the beginning of 2022. When anyone covered by private health insurance is treated for emergency services or at an in-network facility by an out-of-network provider, the health care provider or facility is prohibited from billing a patient above their in-network cost-sharing amount.
Health care providers typically accept the initial payment made by insurance providers, reflecting confidence in payments based on fair market rates and the law’s Qualifying Payment Amount, the report said. For claims where an initial payment is not satisfactory, a substantial percentage of claims are resolved through the law’s open negotiation process. Despite criticisms that the Act is forcing doctors to leave networks, two-thirds of health insurance providers report that their provider networks have increased since it became law, with none reporting an overall reduction in participating providers.
The law established a process for resolving disagreements about what the health plan will pay the out-of-network provider or facility, culminating in independent dispute resolution. Before the Act took effect, the federal agencies responsible for implementation estimated that about 17,000 claims would go through the resolution process annually. During the first year, however, nearly 335,000 disputes were initiated through the portal — nearly 14 times more than the initial estimate. Researchers estimate that approximately 670,000 claims were submitted last year from January 1 through September 30.
A single dispute, as reported by the Centers for Medicare & Medicaid Services, could represent a batched dispute of many claims or a group of several claims for a single visit. Certified independent dispute resolution entities must review each claim individually. This means the volume of claims is even higher than the number of individual disputes, increasing the burden on these entities and driving health-care costs higher through associated fees.
“The large number of disputes initiated, including thousands of batched claims and many ineligible submissions, indicates that many health care providers who previously were able to balance-bill patients now may be using the dispute resolution process, presumably in hope of collecting above-market reimbursement amounts,” the report said. “Should this trend continue, health care costs are likely to unnecessarily increase.”
Although concerns about this trend remain, particularly with the large number of claims in 2023, the survey also examined how plans are expanding networks. Plans that responded to the survey reported increasing or maintaining the provider volume of their networks, with no plans reporting a decrease in network size.
“As the No Surprises Act concludes its sophomore year of enforcement, plans are maintaining or increasing their networks and protections for patients,” the report concluded. “The findings of the survey are important to demonstrate how many consumers have already benefited from the Act and to underscore the extent of total claims that could be impacted if the independent dispute resolution process is not a predictable process with payment amounts that trend toward market rates.”