District Court Orders Departments to Clarify Rules for Emergency Services

On Aug. 31, 2017, the U.S. District Court for D.C. issued a ruling in American College of Emergency Physicians v. Price, Civ. No. 16-913 (D.D.C., Aug. 31, 2017), related to the ACA’s mandated coverage of emergency health services. As background, the Emergency Medical Treatment and Labor Act requires hospitals and emergency departments to provide medical examination, treatment or facility transfer to individuals who have an emergency medical condition.

The ACA requires certain payment by group health plans and health insurers for services performed by an emergency department of a hospital. If the services are performed by an out-of-network provider, the cost-sharing requirements must be the same as if the services were performed by a network provider. In June 2010, HHS, DOL and the Treasury Department (the Departments) issued interim final regulations that established the payment methodology for those out-of-network services. The benefit must be the greater of —

  1. The amount negotiated with in-network providers for the emergency service furnished;
  2. The amount for the emergency service calculated using the same method the plan generally uses to determine payments for out-of-network services (such as the usual, customary and reasonable charges (UCR) but substituting the in-network cost-sharing provisions for the out-of-network cost-sharing provisions); or
  3. The amount that would be paid under Medicare for the emergency service.

During the comment period for interim rule, the plaintiffs (the American College of Emergency Physicians), along with others, commented that the manner in which the UCR rates are calculated by insurers is often not transparent and may be inaccurate. They suggested using an independent database, which would be more transparent.

In November 2015, the Departments issued the final regulations. In response to the plaintiff’s comments, the Departments simply stated that they believed the concern was addressed by the requirement that the amount be the greatest of the three amounts.

In its ruling, the court explained that an agency is not required to address every comment received during the regulatory process, but it must respond in a reasoned manner to those comments that raise significant problems. The court ruled that the Departments acted arbitrarily and capriciously by failing to seriously respond to comments and proposed alternatives submitted by the plaintiffs and others regarding perceived problems with the greatest-of-three regulation.

The case is remanded back to the Departments for them to provide further response to the comments and an explanation of their final rules. The ruling does not change the current requirement related to non-network emergency services. Plans must continue to provide coverage for such at network levels with payment to be determined by the greatest-of-three standard. We will continue to monitor the issue and report any developments in Compliance Corner.

American College of Emergency Physicians v. Price »