The Department of Health and Human Services, the Department of Labor and the Department of the Treasury (the Departments) are continuing to respond to decisions by a federal district court in Texas regarding the Independent Dispute Resolution (IDR) process established to implement the No Surprises Act (NSA). Last Friday, the Departments modified instructions they had given to IDR arbitrators on February 10, which told arbitrators to hold all decisions in process and recall decisions issued after February 6 (the day of the decision in the most recent Texas Medical Association case, referred to as TMA II). In the most recent notice on February 24, the Departments instructed certified IDR entities to resume issuing payment determinations for disputes involving items or services furnished before October 25, 2022, when the final rule published in August 2022 regarding the IDR process became effective. The Departments apparently determined that TMA II was not relevant to those disputes because it relates only to the final rule.
In the notice, CMS stated that IDR disputes for items or services furnished prior to October 25, 2022, are governed by the October 2021 interim final rules regarding surprise billing “as revised by the opinions and orders” in the first decision of the Texas federal court (referred to as TMA I). The decision in TMA I vacated the provisions of the interim rule that established a rebuttable presumption in favor of the Qualified Payment Amount (QPA) in the IDR process. The QPA is the health plan’s median contracted rate for the same service with issuers in the same geographic area, adjusted for inflation.
As to disputes regarding items and services furnished after the final rule went into effect on October 25, 2022, the Departments’ February 24 notice instructed IDR arbitrators to continue to hold payment determinations “until the Departments issue further guidance.” As to these disputes, the notice states that the “Departments are working diligently to complete necessary guidance and system updates in order to allow certified IDR entities to resume processing payment determinations for these disputes.” It is unclear whether that means the Departments have decided not to appeal the federal court’s most recent decision regarding the final rule or when additional guidance will be issued.
In the notice, the Departments pointedly stressed that “[a]ll other Federal IDR process timelines continue to apply.” Therefore, “disputing parties should continue to engage in open negotiations and all other aspects of the Federal IDR process, including submitting fees and offers.” This means the providers, facilities and plans must continue to meet all the deadlines with respect to initial payments, payment of arbitration-related fees and negotiations to resolve a dispute, as well as filing and responding to a dispute regardless of when the items and services at issue were provided.
For those providers and plans that will be submitting disputes to the IDR process prior to the issuance of more definitive guidance, it makes sense to assume, consistent with the decisions in TMA I and TMA II, that the QPA will not be more heavily weighted than other information submitted to the IDR arbitrator and that the arbitrators will accept additional information permitted under the NSA without providers having to first establish the credibility of the information or that the same information was not taken into consideration in connection with the determination of the QPA. However, because the QPA is the only rate information that must be provided under the NSA and the statute expressly prohibits consideration of billed charges, usual and customary rates, and amounts paid by government payors, the QPA is still likely to play a significant role in the process. Similarly, although the court in the TMA cases has made clear that there should not be hurdles to the presentation of evidence, that does not mean the arbitrators will not consider the credibility of the information or whether the QPA already takes that information into account in an appropriate case based on information submitted by the parties.