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WASHINGTON -- After two years of debate in four congressional committees, the No Surprises Act won bipartisan support, passed both houses and then-President Donald Trump signed it into law in December 2020. Come Jan. 1, this landmark consumer law will protect millions of Americans from most unfair surprise medical bills from out-of-network providers. These surprise bills come from balance billing -- when out-of-network medical professionals charge you the difference between their fees and the maximum amount allowed by your insurance company.
The Departments of Health and Human Services, Treasury and Labor have spent the past 10 months writing rules clarifying nuances of the law. The most recently proposed rules, issued on September 30, 2021, deal primarily with how to settle payment disputes between out-of-network providers and insurers. The law establishes an arbitration system and sets guidelines for arbiters to primarily consider the average in-network rate, dubbed the “qualified payment amount,” in making their decisions for payment awards.
In response to the newly issued proposed rules, Patricia Kelmar, U.S. PIRG’s Health Care Campaigns director, made the following statement:
“We’re gratified that regulators implementing surprise billing protections are serious about cost-savings for insured Americans. Under the proposed rules, not only will consumers be protected from the out-of-pocket costs of outrageous surprise bills, but we won’t be burdened by the added costs of exorbitant arbitration awards to out-of-network providers. Keeping payments reasonable by tying them to local in-network negotiated rates means providers still get paid fairly, and consumers won’t bear the burden of costs shifted to our premiums when providers lose outlier lottery-sized payment demands.
“Consumers look forward to these new protections going into effect in January. Even before COVID-19 hit our shores, more than two-thirds of consumers worried about getting a surprise medical bill they couldn’t afford. That’s a legitimate concern: there’s a one in five chance we’ll be hit with a surprise medical bill after receiving care in a hospital or emergency room. We only find out that these providers and services aren’t covered by our insurer after the fact -- when we’re home recovering and the surprise bill of hundreds or even thousands of dollars arrives.
“The No Surprises Act takes consumers out of the middle by protecting them from balance billing. But we also worked hard to make sure the law prevented out-of-network providers from simply charging our insurance companies instead. Those high charges would be passed on to consumers through an increase in our premiums. Analysis showed that, done right, surprise billing protections could reduce those out-of-network payments by insurers significantly -- by up to 15-20 percent.
“We’re looking forward to the coming months when we can help consumers understand their new protections under the No Surprises Act and start seeing real cost-savings.”
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