According to a Dec. 9 press release, the American Hospital Association (AHA) and American Medical Association (AMA), representing hospitals, health systems, and physicians, sued the federal government over the “misguided implementation” of the federal surprise billing law. The AHA and AMA are joined in the suit by plaintiffs including Renown Health, UMass Memorial Health, and two physicians based in North Carolina.
The release states that “The lawsuit challenges a narrow but critical provision of a rule issued on Sept. 30, 2021, by the U.S. Department of Health and Human Services (HHS) and other agencies. The provision being challenged ignores requirements specified in the No Surprises Act and would result in reduced access to care for patients. The rule and this flawed provision are set to take effect Jan. 1, 2022.”
Further, “The AHA and AMA strongly support protecting patients from unanticipated medical bills and were instrumental in passing the landmark No Surprises Act to protect patients from billing disputes between providers and commercial health insurers.”
“The legal challenge became necessary because the federal regulators’ interpretation upends the careful compromise Congress deliberately chose for resolving billing disputes,” the release continues. “According to the lawsuit, the new rule places a heavy thumb on the scale of an independent dispute resolution process, unfairly benefiting commercial health insurance companies. The skewed process will ultimately reduce access to care by discouraging meaningful contracting negotiations, reducing provider networks, and encouraging unsustainable compensation for teaching hospitals, physician practices, and other providers that significantly benefit patients and communities.”
The release explains that Congress created an independent dispute resolution process that is mandatory when providers and insurers can’t reach agreement on payment for out-of-network services from providers who are not under contract with the insurer. But federal regulators have directed arbiters under independent dispute resolution to assume that the median in-network rate is the proper out-of-network rate and limiting when and how other factors come into play.
“The suit argues that the regulations are a clear deviation from the law as written and all but ensure that hospitals, physicians, and other providers will routinely be undercompensated by commercial insurers and patients will have fewer choices for access to in-network services,” the release says.
AHA president and CEO was quoted in the release saying that “No patient should fear receiving a surprise medical bill. That is why hospitals and health systems supported the No Surprises Act to protect patients and keep them out of the middle of disputes between providers and insurers. Congress carefully crafted the law with a balanced, patient-friendly approach and it should be implemented as intended.”
On Nov. 24, we reported that a report from HHS's Office of the Assistant Secretary for Planning and Evaluation found that surprise medical bills are common among privately-insured patients and will be addressed when the No Surprises Act takes effect next year.
The release concludes that “The AHA, AMA and their co-plaintiffs filed their lawsuit against the departments of HHS, Labor, and Treasury, along with the Office of Personnel Management in the U.S. District Court for the District of Columbia.”
