For Now, the No Surprises Act Applies to All Providers

In a chat thread with colleagues on the American Society of Plastic Surgeons’ app message board, there was a question about providing Good Faith Estimates (GFE) for aesthetic procedures under the No Surprises Act (NSA). I said I didn’t think GFEs were required for aesthetic procedures but a representative from the ASPS commented that aesthetic procedures are potentially subject to the requirements of the Good Faith Estimate as specified in the No Surprises Act. Why the difference of opinion regarding this legislation?

THE NO SURPRISES ACT

First, some background. In December 2020, Congress passed the No Surprises Act as part of a larger COVID relief package. It went into effect on January 1, 2022. The No Surprises Act, as the name implies, had one overarching goal: to reduce the occurrence of surprise bills after a procedure.

There are the surprise bills that some might receive after receiving out-of-network care in an in-network facility during an emergency. For example, you’re taken to the hospital in an ambulance after a bicycle accident. You get X-rays that show a broken arm. The ER doctor places you in a splint and you go home to follow up with an orthopedic surgeon. Weeks later, you receive bills for the hospital, ER physician, X-ray, radiologist’s reading of the X-ray, and the ambulance ride. Your insurance covers the bills from the hospital, ER physician, and the X-ray because they are in your network of coverage. However, the bill from the radiologist and the ambulance service seems surprisingly high, and not covered by your insurance. That’s because those services were outside your network of coverage and if you don’t have out-of-network (OON) benefits on your insurance plan, then (Surprise!), you have to pay the full cost out of pocket.

Even if a patient has OON benefits, their cost sharing, i.e., the amount they’re responsible for, would be higher for the OON services. So for example, instead of a $1,500 deductible, $8,000 out-of-pocket maximum and 40% co-insurance for in-network services, your OON cost sharing would go up to $3,000, $16,000, and 50%, respectively.

OUT-OF-NETWORK SURPRISE BILLS

The NSA is meant to address these issues. It has outlawed surprise bills in the case where you receive out-of-network (OON) care in an emergency situation. As the consumer, you still must pay your deductible, out of pocket maximum, and co-insurance, but now the OON bill will be switched from the higher OON rate to the presumably lower “qualifying payment amount” (QPA), which will be closer to an in-network rate. So rather than the insurance company being required to pay the higher OON rate, or the patient paying it themselves, the doctor or provider who sent the bill can only charge the lower in-network rate. That decision to switch to the lower in-network rate was/is the subject of several lawsuits.¹

One of those lawsuits ended in favor of the Texas Medical Association (TMA). TMA believed the regulations written by the Centers for Medicare and Medicaid Services (CMS) did not reflect the intent of Congress. CMS regulations stated that the QPA would be the ”median in-network rate.” When Congress wrote the Act, they stated that the median in-network rate could be one element factored into the QPA but not the sole element. The TMA argued, and the judge agreed, that basing the QPA solely on the median in-network rate allowed the insurance company to put a thumb on the scale in favor of insurers. As of the time of this writing, CMS is re-formulating their final rule in determining the QPA. These other factors may include previously negotiated rates, the insurance company’s market share in the community, and complexity of the case, to name a few.

As an aside, the ambulance ride taken in the scenario above, which was also considered OON, will still have to be paid at the OON rate. Ground ambulance services were excluded from the No Surprises Act,² ostensibly because of the complexity of bureaucracy surrounding ambulances that are sometimes owned by a city or county. In other words, the government passed a bill that excluded a government entity from its own regulations. So in addition to being able to receive higher OON rates, ground ambulances that are owned by the county or city will also continue to receive tax revenue! Air ambulances, which are typically private, were included in the NSA.

The other type of OON bill that was outlawed in the Act relates to receiving non-emergent care from an out-of-network provider at an in-network facility. An example of this is a woman giving birth at an in-network hospital, having her baby delivered by an in-network ObGyn, but receiving her epidural from an OON anesthesiologist. The anesthesiologist’s bill will now be paid at the lower in-network rate due to the recent enactment of the No Surprises Act.

There are exceptions to the OON billing restrictions. In the case of a plastic surgeon who performs breast reconstruction as an out of network provider, they can still bill at the OON rate if they 1.) receive consent from the patient and 2.) provide an estimate of the OON costs the patient should expect. An example of the consent and estimate the patient needs to sign can be found at NoSurprisesAct.com.³

GOOD FAITH ESTIMATE

The other category of the NSA, and the one that relates to the difference of opinion on the ASPS message board, is the Good Faith Estimate (GFE) requirement. This is separate from the OON billing protections discussed above. The GFE relates to providing an estimate to patients who are either uninsured (self-pay) or not utilizing their insurance.

REQUIREMENTS OF THE GOOD FAITH ESTIMATE

If a patient is uninsured (self-pay) or doesn’t want to use their insurance, by law, the provider must provide an estimate that has various elements included in it. Aside from basic demographic information and all expected costs of the planned services to be rendered (physician fee, anesthesia fee, OR fee, ancillary fees), the estimate is required to have ICD-10 codes (e.g., Z41.1–Encounter for cosmetic surgery), CPT codes (leave blank if there’s no corresponding CPT code for a procedure), NPI and EIN numbers, and verbiage that explains the dispute resolution process if actual costs vary from the estimated costs by greater than $400. An example of a Good Faith Estimate can also be found at NoSurprisesAct.com.⁴

WHAT WAS THE INTENTION OF THE NEW REGULATION?

Of course, there’s nothing wrong with providing consumers with full price transparency prior to a procedure, medically necessary or cosmetic. I have a price estimator on my website⁵ for this purpose. But did the government intend to apply all of these other regulations to aesthetic services?

According to the ASPS, the answer is potentially “yes,” because of a gray area in the regulations. I believe their opinion arises from an official CMS document⁶ that states a Good Faith Estimate is required for all uninsured (or self-pay) individuals. That phrase, “uninsured (or self-pay),” is used 103 times in the document. The term cosmetic or aesthetic is never used. However, a liberal reading of the regulation would suggest “self-pay” not only refers to the uninsured or those forgoing insurance, but also patients who pay out of pocket for services not covered by insurance, as in the case of cosmetic procedures.

Within the jargon of medical billing, self-pay does not refer to patients paying for cosmetic services. But according to the letter of the law, cosmetic services are currently included in “self-pay.” While CMS may clarify otherwise in the future, there are several requirements that appear to be clear and apply to everyone. These include the posting of notices at the front desk and on the homepage of the practice’s website that alert the patient to their protections against surprise bills and the right to request and receive a Good Faith Estimate.^7,8

Will CMS dismiss aesthetics from the requirements of the law in the future? While they have provided additional updates and clarifications to the NSA, they have yet to include or exclude aesthetics. So if we’re looking for guidance in aesthetics, we have to extrapolate how these clarifications are applied to other areas of health care. For example, are you required to give someone a Good Faith Estimate for a neurotoxin visit? An update from CMS on April 6 offers insight.⁹ When it comes to walk-in lab services, a GFE is not required. It seems reasonable to apply this scenario to a walk-in neurotoxin or filler appointment. But the document also clarifies that any scheduled repeat treatments, such as physical therapy or counseling sessions do require a GFE—one GFE to cover all sessions in a year, rather than one GFE for each session. This suggests that a GFE would be required for any memberships/subscriptions an aesthetic provider offers, or scheduled sessions for laser hair removal.

Make no mistake, whether these laws apply to aesthetics, the end goal of the NSA and other Trump-era price transparency rules is clear.¹⁰ It is to remove the veil of price opacity from the health care sector and treat it like every other segment of the economy so consumers will know their personal financial responsibility before receiving any good, service or treatment.

1. https://www.healio.com/news/primary-care/20220105/no-surprises-act-faces-multiple-lawsuits-against-billing-dispute-provision

2. https://www.nytimes.com/2020/12/22/upshot/ground-ambulances-left-off-surprise-medical-bill-law.html

3. https://nosurprisesact.com

4. https://nosurprisesact.com

5. http://realdrbae.com/pricing

6. https://www.cms.gov/CCIIO/Resources/Regulations-and-Guidance/Downloads/Guidance-Good-Faith-Estimate-Patient-Provider-Dispute-Resolution-Process-for-Providers-Facilities-CMS-9908-IFC.pdf

7. https://www.buildmybod.com/blog/standard-notice-regarding-patient-protections-against-surprise-billing/

8. https://www.buildmybod.com/blog/notice-right-to-receive-good-faith-estimate/

9. https://www.buildmybod.com/blog/cms-faqs-about-consolidated-appropriations-act-2021-implementation-good-faith-estimates-gfe-for-uninsured-or-self-pay-individuals-part-2/

10. https://www.newsweek.com/winning-victory-cost-transparency-health-care-opinion-1687849