The Department of Labor, the Department of Health and Human Services, and the Department of the Treasury (collectively, “the Departments”) have issued a request for information (RFI) concerning the provisions of the No Surprises Act that require group health plans to furnish individuals an explanation of benefits in advance of the receipt of health services. The Departments posed several questions concerning the entire process and invite responses from providers of health services, plans, insurers, and individuals.

Comments are due by November 15, 2022. The RFI as a stand-alone document can be found at https://www.federalregister.gov/documents/2022/09/16/2022-19798/request-for-information-advanced-explanation-of-benefits-and-good-faith-estimate-for-covered.

Under the law, these provisions were to apply to plan years (or policy years) beginning on or after January 1, 2022.  The Departments issued regulations implementing the law for uninsured (self-pay) individuals (who would receive a good faith estimate (GFE) directly from the provider).¹ However, the Departments deferred enforcement with respect to individuals covered by group health plans or health insurance. Thus, providers and facilities are not required to provide GFEs to plans and insurers, and the plan and insurers are not required to provide an advance explanation of benefits (AEOB), until the departments go through the rulemaking process. 

Background

The No Surprises Act was enacted as part of the Consolidated Appropriations Act, 2021 (CAA). The No Surprises Act added numerous parallel provisions to the Public Health Service Act (PHSA), the Internal Revenue Code (Code), and the Employee Retirement Income Security Act (ERISA) to provide Federal protections against surprise billing and limit out-of-network cost-sharing under specified circumstances.

The No Surprises Act included a requirement to provide an individual with an AEOB when the individual schedules an item or service with a health provider or facility, regardless of whether that provider or facility is in-network or out-of-network. When the appointment is scheduled, the provider or facility is required to inquire if the individual is enrolled in a group health plan or group or individual health insurance coverage. If the individual is enrolled in a plan or coverage and is seeking to have a claim for such item or service submitted to such plan or coverage, providers and facilities must provide to the plan (or health insurance issuer) a GFE of the expected charges for furnishing the scheduled item or service (and any items or services reasonably expected to be provided in conjunction with those items or services, including those provided by another provider or facility), along with the expected billing and diagnostic codes for these items or services.²

Upon receiving the good faith estimate from the provider or facility, a group health plan (or health insurance issuer) is required to send a covered individual an AEOB. The AEOB must be furnished within three business days after the GFE is received if the item or service was scheduled at least 10 business days in advance of the appointment; otherwise, it must be furnished no later than one business day after the GFE is received. The law allows a covered individual to make a request for an AEOB directly to their group health plan or insurer. The plan or insurer must provide an AEOB no later than three business days after receipt of the request.

The AEOB is to include

1. the network status of the provider or facility,
2. the contracted rate for the item or service, or, if the provider or facility is not a participating provider or facility, a description of how the covered individual can obtain information on provider or facilities that are participating,
3. the GFE received from the provider or facility,
4. a GFE of the amount the plan (or coverage) is responsible for paying,
5. the amount of any cost-sharing which the covered individual would be responsible for paying with respect to the GFE received from the provider or facility,
6. a GFE of the amount that the covered individual has incurred towards meeting the limit of the financial responsibility (including with respect to deductibles and out-of-pocket maximums) under the plan (or coverage) as of the date of the AEOB, and
7. disclaimers indicating whether coverage is subject to any medical management techniques (including current review, prior authorizations, and step-therapy or fail-first protocols).³ 

The AEOB must also indicate that the information provided is only an estimate based on the items and services reasonably expected to be furnished at the time of scheduling and is subject to change and can also include any other information or disclaimer the plan determines is appropriate. 

Cheiron Observation: FAQs released in April 2022 regarding GFEs for uninsured individuals exempted appointments scheduled less than 3 business days in advance from the requirement for a GFE.  Presumably, a similar exemption will be instituted for the AEOBs.  The requirement for an AEOB would apparently apply to all other times a participant or beneficiary made an appointment for covered services.

The RFI

The RFI states the Departments deferred enforcement in response to requests that they first establish standards for the data transfer from providers and facilities to plans and insurers and give plans and insurers enough time to build the infrastructure necessary to support the transfers. Citing a 2020 study⁴, the Departments believe that up to 46 percent of prior authorization requests are still submitted by fax, and 60 percent require a phone call during the process. The Departments are therefore interested in whether there are plans, health insurance issuers, and insurance carriers that are small, rural, or have other characteristics such that deploying a standards-based technology might pose a significant barrier to their ability to provide coverage to consumers. 

Accordingly, the RFI asks for comments upon several questions related to

1. Transferring data from providers and facilities to plans and insurers,
2. Other policy considerations, and
3. Economic impacts.

The “other policy considerations” questions include questions relating to

• the use of nonparticipating (i.e., out-of-network) providers and the possibility of a patient’s consent to waive the balance billing protections of the No Surprises Act,
• the interaction with the price comparison requirements applicable under regulations and the No Surprises Act⁵, and
• the interaction with Federal programs like Medicare, Medicaid, and TRICARE to which the AEOB requirements do not apply. 

The Departments also ask whether the AEOB should be furnished to the provider, whether a diagnosis code would be required for the calculation of an AEOB, and whether additional burden would be created by requiring providers, facilities, plans, issuers, and carriers to conduct verification of enrollment status and coverage for each item or service expected to be included.

A full list of the questions is provided in this link.

Cheiron Observation: Plans may specifically want to comment on how the AEOB will integrate the required price comparison tools.

How to Submit Comments

Comments may be submitted in one of three ways:

1. Submit electronic comments to https://www.regulations.gov. Follow the ‘‘Submit a comment’’ instructions.
2. Regular mail. Mail written comments to the following address ONLY: Centers for Medicare & Medicaid Services, Department of Health and Human Services, Attention: CMS–9900–NC, P.O. Box 8013, Baltimore, MD 21244–8013.
3. By express or overnight mail. Send written comments to the following address ONLY: Centers for Medicare & Medicaid Services, Department of Health and Human Services, Attention: CMS–9900–NC, Mail Stop C4–26–05, 7500 Security Boulevard, Baltimore, MD 21244–1850

Allow sufficient time for mailed comments to be received before the close of the comment period. 

Cheiron can assist clients who are interested in submitting comments.

Cheiron is an actuarial consulting firm that provides actuarial and consulting advice. However, we are not attorneys, accountants, or clinicians. Accordingly, we do not provide legal services, tax advice, or medical advice.

 ¹ See the interim final rules published on October 7, 2021, which mainly addressed other provisions of  the No Surprises Act.

² PHSA section 2799B-6.

³ PHSA section 2799-1(f), Code section 9816(f), and ERISA section 716(f).

⁴ See footnote 13 on Federal Register page 56908 for the reference.

⁵ See Q3 of FAQs #49 for a brief discussion of those requirements.