The No Surprises Act (NSA), which came into effect in 2022, aims to protect patients from surprise medical bills in scenarios where they may have limited decision-making power or awareness of provider status, such as emergency care and out-of-network care delivered at in-network facilities.
However, the NSA is facing growing challenges, mainly due to insurers refusing to cover care delivered in such circumstances. This is causing hospitals to dedicate additional resources to pursue fair revenue recovery, elevating their administrative costs and burden.
During a November Becker’s Hospital Review podcast sponsored by HaloMD, Patrick Velliky, chief external affairs officer at HaloMD, discussed what hospital and finance leaders should know about arbitration opportunities, payer compliance and preparing for upcoming regulatory changes.
Three key insights were:
- Internal dispute resolution (IDR) is vastly underutilized at most hospitals. “There are a whole lot more opportunities to engage in arbitration than most hospitals realize,” Mr. Velliky said. This is because providers generally take a narrow view of what’s eligible for arbitration. For example, they may overlook opportunities to pursue arbitration on grounds of definitional differences between what hospitals consider bringing patients to a “medically stable” condition and what the NSA does.
Successful arbitrations have also altered the original implementation pathway of the NSA, which envisioned that it was payers, not providers, who would set the qualifying payment amount (QPA) for in-network procedures. “Today, the QPA is one factor among many and providers can make a compelling case to an arbiter around a whole bunch of other considerations,” Mr. Velliky said.
Beyond using IDR to resolve individual cases of uncompensated care, provider facilities can also use it as an opportunity to secure more sustainable long-term contractual arrangements with payers. “Utilizing the arbitration process to drive toward economic equilibrium and find that fair market rate is really what the NSA was intended to do in the first place,” Mr. Velliky said.
- Despite NSA arbitration successes, hospitals should strive to make their rates sustainable. The policy and regulatory environment for healthcare has evolved to one where outpatient payment rates and Medicare fees are decreasing. Therefore, facilities that maintain excessively high rates are likely to see either decreases in patient volumes or increases in uncompensated care.
“Facilities will have to get smarter about structural changes to the way they operate and find low-cost ways to ensure that revenues and reimbursement are greater than operational costs,” Mr. Velliky said. This outlook should apply not only to operations, but also to any other aspect of healthcare that will be impacted by changing regulations. “Just understanding what’s coming down the pike and what might be disrupting your financial projections can go a long way to ensuring that you don’t get caught by surprise.”
- Providers should be scrutinizing both their own and their payers’/vendors’ compliance. Understanding the responsibilities of other parties that hospitals engage with is necessary to ensure they are not inadvertently opening themselves up to others’ liabilities or being taken advantage of by non-compliant stakeholders. “There’s a very complicated compliance landscape that creates some perverse incentives to not comply,” Mr. Velliky cautioned.
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