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Challenges to the Independent Dispute Resolution Final Rule of the No Surprises Act of August 2022 | JD Supra

Controversy continues to surround the Independent Dispute Resolution (IDR) provisions of the No Surprises Act (NSA). On Nov. 18, the bipartisan leadership of the House Ways and Means Committee sent a letter to the secretaries of the Ministries of Health and Human Services, Labor, and Treasury (departments) stating that the leadership is “seriously disappointed” with find that the August 2022 Final Rule implementing the IDR process violates the NSA in the same manner as the previous Interim Final Rule with comment period.

Under the NSA, if a provider and a health plan cannot agree on the amount the plan will pay for a service to which the NSA applies, the provider and the health plan must resolve the dispute by the new federal IDR process. The original October 2021 Interim Final Rule stated that arbitrators implementing the IDR process should apply a “rebuttable presumption” that the Qualifying Payment Amount (QPA) – a health plan’s median contractual rate for the same service in the same geographic area, adjusted for inflation – is the most appropriate rate for the service. Health care providers argued that the rule favored health plans in the IDR process by giving additional weight to the amount plans had already agreed to pay — the median contract rate. The Texas Medical Association (TMA) and others sued the departments, saying the presumption violated NSA text, which the TMA says requires arbitrators to give equal consideration to all factors expressly identified in the NSA as relevant in determining the appropriate payment. The TMA prevailed and the District Court struck down several provisions of the Interim Final Rule with a comment period implementing the rebuttable presumption.

In the August 2022 final rule, the Ministries claimed to have fixed the rule by removing the rebuttable presumption in favor of the APQ. TMA disagreed and filed a second lawsuit in September 2022 seeking to strike down provisions of the final rule that it says continue to violate the NSA by improperly tipping the scales in favor of the NSA. QPA. Although the letter from the chairman and member of the House Ways and Means Committee does not mention the TMA’s second lawsuit, it does adopt some of the TMA’s reasoning in that complaint, accusing the departments of including new provisions in the final rule that perpetuates the rifts in between. final rule. Specifically, the letter argues that a “double-counting test” in the Final Rule incorrectly directs arbitrators to give no weight to factor-related information if the Certified IDR Entity determines that the information has already been taken into account. account in the calculation of the QPA. Ways and Means Committee leaders say this provision does not implement the NSA’s intent because it skews the decision in favor of the LPQ, creating an increased burden for consideration of other factors expressly identified as relevant in NSA, such as patient acuity. and the complexity of delivering the service, and adopting a standard that would be impossible for providers to meet because QPA calculation methodologies are a “complete mystery” to everyone other than the plans of health. A hearing on the TMA’s second lawsuit, supported by other provider associations, including the American Medical Association and the American Hospital Association, is scheduled for December 20, 2022.

Information about the IDR process recently released by the Centers for Medicare & Medicaid Services highlights the importance of implementing the IDR process correctly. Between April 15, 2022, the launch of the federal IDR portal, and September 30, 2022, more than 90,000 disputes were initiated. On an annualized basis, this would represent more than 11 times the number of IDR disputes that departments estimate would be filed in 2022. Additionally, disputes are more complex than departments expect, with more than half (over 41,000) involving eligibility challenges from litigation to resolution within the IDR process. Of these, more than 22,000 were found to be ineligible for the IDR process. Surprisingly, despite the highly streamlined nature of the IDR process, only around 3,500 payment decisions were made by IDR arbitrators.

Stay tuned for further updates regarding the implementation of the IDR process and related litigation on this important issue for plans and providers.

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