Federal government to propose setting IDR fee under No Surprises Act at $150

The federal government released preliminary documents Thursday, indicating that it plans to set the administrative, per-party fee for resolving out-of-network payment disputes at $150 in 2024.

Back in August, a district court sided with physicians in one of several lawsuits related to the No Surprises Act, which is aimed at protecting patients from unexpected IOUs. The Texas Medical Association and others had challenged the feds for hiking this fee by 600%, up to $350 from the original $50.

After Judge Jeremy D. Kernodle ruled in radiologists’ favor, vacating the fee hike, CMS reverted the fee back to its original amount. However, the departments of Health and Human Services, Labor and Treasury are now proposing to up the charge for independent dispute resolution by 200%.

“Under this proposed rule, the departments propose to retain the flexibility to update the administrative fee more frequently or less frequently than annually,” the feds wrote in the prepublication version of their proposed rule. “With this flexibility, the departments intend to update the administrative fee amount when the total projected amount of administrative fees paid or projected expenditures made by the departments to carry out the Federal IDR process changes, such that a new administrative fee amount would be required for the departments to cover the costs of carrying out the federal IDR process.”

Changes in the volume of IDR disputes, regulations governing the process, or the departments’ cost structure all could potentially push the feds to seek another fee hike, according to the notice. The federal government will be accepting comments on the proposed change for 30 days, once the rule is officially published in the federal register.

The notice comes after the House Ways & Means Committee held a hearing this week on the “flawed” implementation of the No Surprises Act. Patients have reportedly lost access to care, with their insurance covering fewer doctors, while physicians and hospitals are struggling to receive reimbursement for their work, according to a summary of the event released on Thursday.

Marietta, Georgia-based Wellstar Health System estimates that it has initiated 8,000 IDR requests. Of those, only 588 (or 7%) have been resolved, with 288 (4%) landing in the health system’s favor, Jim Budzinski, MBA, executive VP and chief financial officer, told lawmakers on Sept. 19.

Some commercial payers are refusing to even negotiate with providers, he reported.

“[Large health insurers] are selling insurance in counties where they don’t have any emergency departments in-network. How is that possible?” Budzinski said. “The reason is they don’t have a need to have an in-network emergency department. They don’t have to negotiate with a hospital or health system or physician group, because they can use the No Surprises Act process as it’s currently being implemented to pay in-network rates for out of network care. ... I’ve been in the healthcare finance business for over 40 years. That has never been the case.”

Read Radiology Business’ previous coverage of the NSA at the links below.