On September 26, 2023, the Departments of Health and Human Services, Labor, and the Treasury (collectively, “the Departments”) released a proposed rule that would again change the administrative fees for participating in the No Surprises Act’s (“NSA”) Independent Dispute Resolution (“IDR”) process. The proposed rule responds to the August 3, 2023 ruling from the U.S. District Court for the Eastern District of Texas (the “Court”) which concluded that the Departments’ increase of the IDR administrative fee from $50 to $350 violated the Administrative Procedure Act (“APA”) because the Departments failed to follow the APA’s requisite public notice and comment process. To read more about the prior court ruling, please see our previous article here.
Proposed Administrative Fee and Methodology
The IDR process is a mechanism for out-of-network providers and health insurers to determine the appropriate out-of-network rate for those services for which the NSA prohibits an out-of-network provider from balance billing a patient. For a more detailed discussion of the NSA IDR process, please see our previous articles here and here. Importantly, there are two fees parties must pay when utilizing the IDR process, an administrative fee and a certified IDR entity fee. The recently proposed rule clarifies that the Departments may only increase the IDR administrative fee and the range of allowable certified IDR entity fees through the APA’s notice and comment rulemaking procedure.
The Departments proposed determining the amount of the administrative fee by dividing the amount of the Departments’ total projected annual IDR process expenditures by the projected number of administrative fees disputing parties pay during the same period. Based on the Departments’ projections of the number of IDR disputes to be closed and the administrative costs of administering those disputes for 2024, the Departments propose an IDR administrative fee of $150 per party, per dispute starting January 1, 2024, or the finalization of the proposed rule.
The Departments proposed setting the allowable certified IDR entity fees to range between $200 to $840 for single determinations and to range between $268 to $1,173 for batched determinations. The upper limit of these ranges reflects a 20% and 25% increase from the current 2023 rates, respectively. As proposed, each certified IDR entity must, on an annual basis, provide a fixed fee for single determinations and separate fixed fees for batched determinations within the Departments’ established ranges. The Departments would require a certified IDR entity to seek prior approval from the Departments before charging a fee more than the limits set by the Departments.
Practical Takeaways
- The Departments intend to address other industry concerns related to the applicable IDR fees in future rulemaking, including a potential reduction in the administrative fee for IDR disputes involving low-dollar claims.
- The Departments anticipate issuing a proposed rule on an annual basis to increase the applicable IDR fees and to address other material concerns related to the IDR process, as needed.
- Interested parties can submit public comments on this proposed rule for the Departments’ consideration through October 26, 2023.
- Hall Render will continue to monitor all guidance, rules and other updates related to the NSA’s IDR process and will provide timely relevant updates.
For more information on the requirements of the No Surprises Act or the IDR process, please contact:
- Angela Smith at (317) 977-1448 or asmith@hallrender.com;
- Ben Fee at (720) 282-2030 or bfee@hallrender.com;
- Lisa Lucido at (248) 457-7812 or llucido@hallrender.com;
- Matt Reed at (317) 429-3609 or mreed@hallrender.com;
- Zeke Shen at (414) 721-0912 or zshen@hallrender.com; or
- Your primary Hall Render contact.
Hall Render blog posts and articles are intended for informational purposes only. For ethical reasons, Hall Render attorneys cannot give legal advice outside of an attorney-client relationship.
