Another No Surprises Act win: Qualifying payment amount process was tilted in insurers’ favor, judge rules

Radiologists and other physician specialists have scored another key court victory in the ongoing battle over the No Surprises Act, advocates said Monday.

A Texas judge ruled Aug. 24 that methodology insurers use to calculate the “qualifying payment amount”—the basis for negotiations over out-of-network reimbursement—is tilted in payers’ favor. The court is now disallowing several provisions related to how the QPA is determined, including incorporating “ghost rates” for services that radiologists and other docs do not provide.

“The ruling is a step toward an independent dispute resolution process that is accessible, fair and efficient,” Jacqueline A. Bello, MD, chair of the American College of Radiology Board of Chancellors, said in a statement issued Aug. 28. “The insurer-calculated QPA process is a ‘black box’ that drives unsustainably low reimbursement, undermines practices’ ability to provide care and may reduce patient access to in-network care. The government must issue rules to make the IDR process work as the law intended.”

U.S. District Judge Jeremy D. Kernodle’s order additionally would allow self-insured group health plans to use rates from all payers handled by a third-party administrator in calculating the QPA. This is the court’s fourth such ruling on the “flawed” implementation of the No Surprises Act, ACR noted, which came in response to lawsuits filed by the Texas Medical Association. ACR, the American College of Emergency Physicians and the American Society of Anesthesiologists filed an amicus brief earlier this year, stating their support for the suit.

The three specialty societies issued a joint statement Monday, noting that the government will now have two months to appeal the ruling.

“If it stands, this decision will end a status quo that allowed insurers to game the system at the expense of community-based physician practices,” ACR et al. said. “This important ruling will bring the law back in line with what Congress intended for the No Surprises Act—protecting patients from surprise bills and creating an unbiased mechanism to resolve payment disputes between insurers and physicians.”

The departments of Health and Human Services, Labor and Treasury have not yet indicated how they’ll proceed following the decision. The NSA’s arbitration process remains on hold following another key court ruling on Aug. 3, which vacated the 600% fee increased for independent dispute resolutions under the landmark law. ACR and the emergency medicine and anesthesiology societies emphasized that the latest decision does not impact patient protections spelled out in the NSA, which they support.

“While we await federal agency rules regarding the court’s decisions, it is now clear that the rules governing the application of the NSA and the establishment of the QPA should not be weighted in favor of the insurance industry,” Bob Still, executive director of the Radiology Business Management Association, told Radiology Business Monday. “This decision will clearly benefit physicians and more importantly their patients.”

Marty Stempniak

Marty Stempniak has covered healthcare since 2012, with his byline appearing in the American Hospital Association's member magazine, Modern Healthcare and McKnight's. Prior to that, he wrote about village government and local business for his hometown newspaper in Oak Park, Illinois. He won a Peter Lisagor and Gold EXCEL awards in 2017 for his coverage of the opioid epidemic. 

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