Compliance Corner

Federal Updates

CMS Issues New Guidance on Federal Independent Resolution Process

April 26, 2022

On April 12, 2022, the DOL, IRS and HHS jointly released revised process guides for independent dispute resolution (IDR) under the No Surprises Act (NSA), enacted as part of the Consolidated Appropriations Act, 2021 (CAA). Additionally, the online Federal IDR system portal for resolving payment disputes between insurers/plans and providers for certain out-of-network (OON) charges is now open.

The NSA provisions protect participants from surprise bills for OON emergency and air ambulance services and certain OON services received at in-network facilities. The NSA requirements apply to both insured and self-funded group health plans and are effective for plan years beginning on or after January 1, 2022.

If a plan or insurer and provider cannot agree on the OON payment amount after a 30-day negotiation period, the federal IDR process can be initiated. The arbitrator in the federal IDR process (termed the “certified IDR entity”) must select either the payment amount proposed by the healthcare provider or the amount proposed by the plan or insurer. The previous Rule required that presumptive weight be given to the qualifying payment amount (QPA), which is the median contracted rate for an item or service for a geographic region. Accordingly, under the Rule, the certified IDR entity must select the offer closest to the QPA unless either party submits information that clearly demonstrates the QPA is materially different from the appropriate OON rate.

However, in response to the recent court’s ruling that invalidated a portion of the regulations that required the certified IDR entity to prioritize the QPA over other factors in determining the OON rate (for more information on the court ruling, please see our prior article), the revised IDR guides require the certified IDR entity to consider additional credible information in addition to the QPA.

For non-air ambulance items and services, the additional factors are:

  • A provider’s level of training, experience and outcomes
  • The provider’s market share
  • The patient’s acuity or the complexity of furnishing the services to the patient
  • Other relevant information provided by either party

For air ambulance services, the IDR entity should consider credible information independently from the QPA so that the information clearly demonstrates that the QPA is different from the appropriate OON rate for the qualified air ambulance service. The Federal IDR Portal is now live, so plans and insurers will want to familiarize themselves with these reworked process guides since some timeframes for action are quite short. Keep in mind that further changes may be forthcoming, and litigation by providers may necessitate other changes to the process.

Employers who sponsor group health plans should be aware of the revised guidance and familiarize themselves with the Federal IDR Portal system. Employers should also monitor future guidance and developments as further changes may be forthcoming.

CMS: Federal Independent Dispute Resolution (IDR) Process Guidance for Disputing Parties – April 2022 »
CMS: Federal Independent Dispute Resolution (IDR) Process Guidance for Certified IDR Entities – April 2022 »
CMS: Federal IDR System Portal »