Processes Needed:

No Surprises Medical Bills

I. Background

The No Surprises Act, part of the larger Consolidated Appropriations Act of 2021, has a goal of protecting those people covered under group and individual health insurance plans from receiving surprise medical bills. A frequent source of these surprise bills has been when a patient receives emergency services (or even non-emergency services) from out-of-network providers (even though the patient may receive these services at an in-network facility). One common example is that of out-of-network air ambulance service providers. It is common that air ambulance services typically result in surprise bills.

Beginning in 2022, the No Surprises Act will institute new protections that prevent surprise medical bills. Private health insurance generally bans the most common types of surprise bills. However, if a patient is uninsured, or decides not to use their health insurance for a service, these protections enable you to get a good faith estimate of the cost of your health care up front, before your visit.

If a patient obtains health coverage through an employer, a Health Insurance Marketplace, or through an individual health insurance plan which is purchased directly from an insurance provider, the new rules are important because they do the following.

• Ban surprise bills for most emergency services, even if you get out-of-network services without prior authorization.
• Ban out-of-network cost-sharing (like out-of-network coinsurance or copayments) for most emergency and some non-emergency services. You cant be charged more than in-network cost-sharing for these services.
• Ban out-of-network charges and balance bills for certain additional services (like anesthesiology or radiology) furnished by out-of-network providers as part of a patients visit to an in-network facility.

The law took effect on January 1, 2022.

II. Problem and Objectives

Various agencies (some governmental, others not) have provided summaries of the No Surprises Act which detail what the medical providers must incorporate into their operations. However, no firm processes are included in these guideline summaries. Thus, it is up to the individual insurance providers to create their own operational structures. For example, consider the guidelines below (copied/taken verbatim from the American Medical Associations AMA High-Level Summary of the No Surprises Act, 2020).

General structure: patient protections against surprise medical bills and determining out-of-network provider payments:

• For services provided by a nonparticipating provider (e.g., physician at a participating facility or at a nonparticipating emergency facility:
  • Providers may not bill beyond allowed cost-sharing amount (this amount is based on the recognized amount).
  • There must be an initial payment (determined by the plan) directly from the plan to the provider, or a notice of a denial, within 30 days from when the provider transmits the bill to the plan.
  • If the provider is not satisfied with the payment from the plan, they may begin a 30-day open negotiation period.
  • If an agreement cannot be reached in the open negotiation period, the plan or provider has 4 days to notify other party and Secretary of HHS that they are initiating the Independent Dispute Resolution (IDR) process.

• IDR Structure:
  • The provider or plan have a 30-day window from the day the provider receives an initial payment or notice of denial of payment from the plan to initiate the open negotiation period.
  • If the provider and plan cannot reach an agreement by the end of the 30-day open negotiation period, the plan or provider may initiate IDR during the 4-day period after the open negotiation period ends.
  • IDR is initiated when the provider or plan submits a notification to the other party and Secretary of HHS.
  • Within three-business days following the date the IDR was initiated, the provider and plan jointly select a certified IDR entity.
  • The parties may continue negotiating during the 30-day IDR process, and may agree on an amount of payment before the end of the IDR process (in such case both parties will share the cost to compensate the IDR entity).
  • Within 10 days of IDR entity being selected, the parties must submit final offers, information required by IDR entity, and any information (except and noted below) the parties would like related to their offers.
  • Within 30 days, the IDR entity selects one of the offers submitted and must consider:
    • Offers by both parties.
    • Qualifying payment amount (for the same service in the same geographic region)
    • Circumstances:
      • Training, experience, quality and outcomes measurements.
      • Market shares of parties.
      • Acuity of patients/complexity of cases.
      • Teaching status, case mix, scope of services of facility.
      • Good faith efforts by parties to contract and contracting rate history from last four year.
    • The provider and plan may also submit other information relating to such an offer submitted by either party.
    • The IDR entity cannot consider usual and customary rates or billed charges.
    • The IDR entity also cannot consider the payment rates by public payors, including Medicare, Medicaid, CHIP, and Tricare rates.
  • The party whose offer was not chosen by the IDR entity, pays the costs of IDR.
  • Payment must be made to the provider within 30 days of the IDR entitys determination.
  • Batching is allowed for claims submitted within a 30-day period that meet the following:
    • Services furnished by same provider or facility.
    • Services provided to patients under the same plan.
    • Services are for treatment of similar conditions.
    • The Secretary to specify criteria and may allow exceptions to 30-day period.
  • The party that initiated IDR cannot initiate it again with the same party and for the same services for 90 days. However, once the 90-day period is up, the party may submit (appropriately batched) claims from that 90-day period to IDR.
• HHS to publicly report on IDR use and outcomes, including the identity of health plans, providers, and facilities that use the process. The Secretary must ensure that there is no release of confidential or privileged information.
• Parties that use the IDR process will be required to pay an administrative fee to the Secretary ach year (the amount to be established by the Secretary).

III. The Goal

Your role is to suppose that you have been hired to assist an insurance company in implementing these portions of the No Surprises Act. Specifically, the company would like help in mapping out processes, coming up with system use authorizations (who is permitted to use which applications), and the data items which might be required by the No Surprises Act. All companies must develop and maintain an All payer claims database. Thus, it becomes imperative that the database effort be a focal point of the work which you will complete as part of this project.

IV. Develop a Use Case Model

1. Use Case diagram and Use Case description/narrative