President Joe Biden signed the No Surprises Act (NSA) into law on December 27, 2020, ensuring that those who unknowingly or inadvertently use out-of-network providers or facilities in specific situations will face no more than normal in-network cost sharing. The act is part of a $2.3 trillion spending package advanced by Congress to address the COVID-19 pandemic.

While the new rule has gotten a lot of attention in the private insurance sector, it has largely flown under the radar in the world of workers’ compensation insurers. At least one pundit has predicted that the rule (and modifications to it that are yet to come) could address a crucial cost area for the workers’ comp industry.

The NSA, which goes into effect on January 2, 2022, protects “patients from receiving surprise medical bills resulting from gaps in coverage for emergency services and certain services provided by out-of-network clinicians at in-network facilities, including by air ambulances.”

In implementing the NSA, the U.S. Department of Health and Human Services announced the new rule to provide further protections for patients against surprise medical bills that occur when out-of-network provider fees exceed what health insurance plans are willing to cover and the difference is billed to the patient. The practice, known as balance billing, is when a provider charges a patient the remainder of what their insurance does not pay, and is currently prohibited in both Medicare and Medicaid. This rule will extend these protections to those insured through employer-sponsored and commercial health plans.

The new rule implements provisions of the NSA that apply to “group health plans, health insurance issuers offering group or individual health insurance coverage, and carriers in the Federal Employees Health Benefits Program.”

Other key provisions of the HHS rule, according to a July 1 HHS new release:

• Bans surprise billing for emergency services. Emergency services, regardless of where they are provided, must be treated on an in-network basis without requirements for prior authorization.
• Bans high out-of-network cost-sharing for emergency and non-emergency services. Patient cost-sharing, such as co-insurance or a deductible, cannot be higher than if such services were provided by an in-network doctor, and any coinsurance or deductible must be based on in-network provider rates.
• Bans out-of-network charges for ancillary care (like an anesthesiologist or assistant surgeon) at an in-network facility in all circumstances.
• Bans other out-of-network charges without advance notice. Health care providers and facilities must provide patients with a plain-language consumer notice explaining that patient consent is required to receive care on an out-of-network basis before that provider can bill at the higher out-of-network rate.

In an article published last month in workcompcentral.com, Joe Paduda, co-owner of CompPharma, explained why the issue has gone unnoticed by many workers’ comp insurers. “That may be because comp payers are pretty unsophisticated about facility billing, despite claims from bill review departments/vendors to the contrary.”

In the article, Paduda characterized the NSA and the subsequent HHS rule as key salvos in the ongoing “war” against surprise billing with Congress trying to protect consumers on one side and the private equity firms that own medical services companies on the other. He encourages those in the workers’ comp industry to “jump into the fray by encouraging their state legislators to include work comp (and auto for that matter) in the list of payers covered by state surprise billing laws.” He notes that about 18 states have comprehensive laws in the books curtailing surprise billing and numerous others have laws that “deal with parts of the issue.”

Paduda says that, if workers’ comp is included in the ban on surprise billing, then that is good news for the WC industry. If not, he says, expect even more charge-shifting to workers’ comp patients.