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No Surprises Act Four Years Later: Payment Delays, Enforcement, and Independent Practice · Becker’s Healthcare Podcast

• 0:00
  - Hi, everyone. This is Lucas Voss with Becker's
• 0:02
  - Healthcare. Thanks so much for tuning in to
• 0:03
  - the Becker's Healthcare podcast series in our episode
• 0:06
  - on the No Surprises Act four years later,
• 0:09
  - progress goals and most certainly the road ahead.
• 0:12
  - I'm excited to welcome Patrick Velleke to the
• 0:14
  - podcast. Patrick is the chief external affairs officer
• 0:17
  - at HaloMD and has spent almost two decades
• 0:19
  - in the health care advocacy space with a
• 0:21
  - deep understanding
• 0:22
  - of health care policies. Also spent time in
• 0:24
  - Washington, DC, supporting congressional representatives
• 0:27
  - and their offices. So excited to have him.
• 0:30
  - Patrick, welcome to the podcast. Hey, Lucas. Good
• 0:32
  - to be here. So we mentioned it in
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  - the title four years after, right, after the
• 0:37
  - No Surprises Act took effect.
• 0:40
  - What's working as intended
• 0:42
  - today,
• 0:43
  - and where are we seeing those shortcomings
• 0:46
  - still for providers?
• 0:48
  - Yeah. So I think primarily,
• 0:51
  - the patient protections by and large have have
• 0:53
  - worked as intended. Right? Patients
• 0:55
  - are are generally not seeing,
• 0:58
  - exposure to to out of network bills in
• 1:00
  - a way that they did pre NSA. And
• 1:02
  - even that's not perfect, there are still some
• 1:03
  - instances where where we've seen,
• 1:05
  - insurers incorrectly
• 1:07
  - adjudicating claims. But by and large, the patient
• 1:10
  - protections have have worked, and that was really
• 1:13
  - the the core principle behind the NSA. The
• 1:15
  - patients should be able to seek care and
• 1:18
  - not worry that,
• 1:20
  - a provider was out of network without their
• 1:22
  - their knowledge. So that that's that's been really
• 1:25
  - positive.
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  - Where there have been real issues and ongoing
• 1:29
  - concerns,
• 1:30
  - is on the back end,
• 1:32
  - payment process related to the NSA's IDR,
• 1:36
  - system.
• 1:37
  - We have
• 1:38
  - seen pretty disturbing trends around insurer nonpayment
• 1:42
  - of arbitration awards
• 1:44
  - after
• 1:45
  - a valid arbitration outcome.
• 1:47
  - There are instances where certain payers have a
• 1:50
  - a 0% payment rate where they are just
• 1:52
  - simply ignoring,
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  - arbitration awards.
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  - So, I think that is a a real
• 1:57
  - concern and, frankly, a real threat to access
• 2:00
  - and stability stability for providers.
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  - I I wanna touch more on those
• 2:05
  - delays, etcetera.
• 2:07
  - What's driving that right now? Why is this
• 2:09
  - happening?
• 2:11
  - Yeah. It's a great question. So I think
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  - there are a couple of things. One, it
• 2:14
  - it's really important to understand just how different
• 2:17
  - the sort of financial structures of insurers are
• 2:20
  - as opposed to to physicians and and hospitals.
• 2:24
  - At the most basic level, insurers are paid
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  - in advance. Right? They collect premiums,
• 2:29
  - and they hold on to those premium dollars
• 2:31
  - until they have to pay for care.
• 2:33
  - Whereas providers and and facilities are paid in
• 2:36
  - arrears. Right? They're paid after they've already provided
• 2:39
  - a service.
• 2:40
  - And that means that each side has very,
• 2:43
  - very different incentives around
• 2:46
  - when to to pay or receive funds.
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  - In a nutshell, every day that an insurer
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  - gets to delay making a payment for a
• 2:54
  - service that's already been provided
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  - is another day that those unspent premium dollars
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  - remain invested
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  - in generating a return.
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  - So the longer insure can hold on to
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  - those premiums,
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  - the more financial benefit they obtain,
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  - through the time value of money.
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  - So I think,
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  - one, it is certainly that time value of
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  - money calculation.
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  - But two,
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  - they've made a risk assessment. Right?
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  - They've taken a look at the environment and
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  - said the risk of enforcement
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  - around timely payment
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  - is is very, very low.
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  - There haven't been, to date, any, at least,
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  - public
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  - enforcement actions that have created any meaningful consequence
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  - for the insurers.
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  - So, I mean, look. Worst case scenario,
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  - some regulator tells me I've gotta pay what
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  - I should have paid in the first place.
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  - Fine. You know, you end up,
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  - eventually paying what you should have paid
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  - just twelve months late, and in the meantime,
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  - generated interest off of the flow.
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  - So, yeah, it's it's that perverse incentive around
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  - holding on to those payments
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  - and the risk assessment that there is simply
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  - just not that much downside for the insurer,
• 4:06
  - in in noncompliance.
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  - So there are broader incentives in play. You've
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  - this touches, again, legal policy relations, etcetera, operations
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  - as you've just highlighted, but there are broader
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  - incentives at play here from what you've just
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  - described.
• 4:19
  - Oh, absolutely. Yeah. I mean, look. I have,
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  - a firmly held belief that if there's a
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  - behavior
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  - that you've you've witnessed that,
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  - you know, is is not undesirable in the
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  - policy space, Well, there's some incentive driving that
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  - behavior.
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  - So
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  - getting to the root of those incentives
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  - tends to be the key in driving the
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  - policy.
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  - Now we've seen, again, providers
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  - specifically, they've they've pursued litigation. There's certainly other
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  - avenues that they've
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  - gone through, mixed success, some success here, not
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  - no success there.
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  - Where are we at today on that front?
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  - And, again, what are those options for providers
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  - right now
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  - that prove more successful than others?
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  - Yeah.
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  - So federal
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  - district litigation has has so far mostly proven
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  - unsuccessful.
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  - I believe there have been about
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  - 45,
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  - maybe 50,
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  - separate
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  - federal cases brought against health insurers
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  - by provider groups trying to
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  - confirm arbitration awards, basically,
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  - trying to compel payment for these unpaid awards.
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  - And the vast majority of,
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  - federal district courts have found,
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  - against providers,
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  - essentially finding that there's no standing, that the
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  - NSA,
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  - doesn't create a private right of action,
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  - to pursue
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  - that through confirmation like you would for
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  - a a typical arbitration award outside of of
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  - the NSA process.
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  - Only, I believe,
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  - two,
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  - district courts have have found otherwise, a court
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  - in Connecticut and a court in Washington state.
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  - And,
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  - that basically means that by and large,
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  - the courts, at least federal courts, are not
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  - a viable avenue for,
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  - enforcing payment of these awards and and obtaining
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  - what providers are are owed.
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  - That generally means that the burden instead falls
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  - to federal regulators for the most part.
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  - HHS
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  - and Department of Labor
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  - primarily
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  - in trying to get some sort of enforcement
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  - activity and and
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  - compel
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  - that required payment.
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  - Now where there's litigation, there's often a response
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  - or most certainly always a response somehow.
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  - Some insurers have, pointed to eligibility reviews as
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  - the reason. Right? Some of the certain awards
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  - remain unpaid, etcetera.
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  - Is that a valid
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  - explanation from your perspective? Or, again, should those
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  - questions already have been resolved
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  - before an IER decision is issued?
• 6:56
  - Yeah. Great question. So
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  - the insurers would have you believe that,
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  - 40%
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  - of,
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  - disputes that could arbitration
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  - should be found ineligible.
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  - But in reality,
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  - there is no evidence to support that claim
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  - other than insurers being asked to to take
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  - their word for it. The arbitration process
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  - has several safeguards designed around eligibility.
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  - But first and foremost, it's important to understand
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  - that,
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  - it is the arbiter and
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  - CMS
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  - that has ultimate responsibility
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  - for determining eligibility,
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  - not the insurer.
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  - So
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  - what you've seen a lot is insurers simply
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  - asserting that they don't believe a dispute should
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  - have been eligible,
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  - and that as a result, they they don't
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  - intend to pay.
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  - And we've got lots and lots of examples
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  - internally
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  - where the plan is outright wrong about that
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  - eligibility determination that that they've reached. I have
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  - examples where an insurer has has told us,
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  - hey.
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  - This can't go to arbitration because, it's a
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  - a Medicaid claim.
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  - But then you actually go and and verify
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  - the information behind that claim, and it it's
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  - not. It is very, very clearly
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  - based on that health insurer's own
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  - portal and and website.
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  - It it's a an ERISA PPO, a commercial
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  - plan provided by an employer.
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  - So
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  - there is not a whole lot
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  - to to support
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  - the payer assertions around eligibility.
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  - And, frankly,
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  - even if there are instances
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  - where ineligible disputes
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  - make it through the process,
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  - CMS specifically created,
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  - what's known as the the TA process, the
• 8:38
  - technical assistance process, or,
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  - the process for reopening disputes that were closed
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  - in error.
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  - It it's an entire
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  - pathway
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  - for identifying to the IDRE and and to
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  - CMS,
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  - hey. It looks like the IDRE made an
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  - error in the way that they process this
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  - dispute.
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  - It was found to be eligible, but here
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  - I have evidence showing that it should have
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  - been.
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  - There's a very, very clear pathway that's been
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  - built to resolve those errors when they do
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  - happen. And CMS made really clear in their
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  - guidance on that that, hey. Just because you
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  - intend to initiate that reopening process or even
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  - if you already have initiated it but it
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  - hasn't been
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  - ruled on yet,
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  - that doesn't,
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  - undo your responsibility
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  - to pay timely.
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  - You have to treat every award as though
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  - it is binding
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  - until and unless,
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  - it is found to be otherwise.
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  - So, again, even if there are, you know,
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  - a handful of instances where ineligible disputes do
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  - unfortunately make it through,
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  - there's a process for resolving that,
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  - and, the plans aren't abiding by that process
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  - either.
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  - Just to come back to the number too.
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  - Right? 40% is such a staggering number when
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  - you think about this process that you've just
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  - described, which is incredible. And I do wanna
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  - close our conversation with a little bit of
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  - a different aspect of this too because, again,
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  - it sounds theoretical,
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  - and there's so many things that we touch
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  - on here. But, again, this has real impact.
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  - Specifically, when we talk about independent practices, for
• 10:10
  - example, they say, you know, delayed or unpaid
• 10:13
  - arbitration, again, creates that real cash flow pressure
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  - on their operation, which has impact direct impact
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  - on patient care, direct impact on their communities.
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  - To what extent do you think those financial
• 10:27
  - pressures are, again, then also contributing
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  - to a larger trend to continued consolidation of
• 10:32
  - these physician practices?
• 10:34
  - Yeah. Absolutely. And and, one item on on
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  - that 40% number that that Yeah. Payers have
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  - have mentioned.
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  - The the payers, AHIP and BCPSA, did a
• 10:43
  - a survey of their their plans to reach
• 10:45
  - that that number. And really importantly,
• 10:48
  - the largest category,
• 10:50
  - around the reasons that the plan said dispute
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  - should have been found ineligible
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  - was this category other,
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  - that includes a whole bunch of reasons that
• 11:00
  - have nothing to do with actual eligibility.
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  - Things like the initiating party didn't provide,
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  - a reason for initiating the dispute.
• 11:09
  - Well, the reason is clear. It was under
• 11:12
  - reimbursement. Right? So
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  - that that number is so drastically and
• 11:16
  - sort of in bad faith inflated
• 11:19
  - as to be comical.
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  - But to your your very important question on
• 11:23
  - sort of the impact of this nonpayment,
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  - there are groups that that we represent as
• 11:29
  - as HaloMD
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  - that employ fewer than five physicians. Right? Truly
• 11:34
  - small groups. In fact, about 73%
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  - of of the groups that we represent
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  - have fewer than 100
• 11:41
  - physicians, about 23 of fewer than five.
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  - So,
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  - truly,
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  - you've got these small independent groups
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  - that
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  - getting reimbursed timely is the difference between,
• 11:53
  - hiring an additional
• 11:54
  - staff member to provide care or or not.
• 11:57
  - Different physicians thrive in different environments. Right? I
• 12:00
  - don't think there's anything inherently bad about large
• 12:02
  - groups. I don't think there's anything inherently
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  - amazing about small groups. You know, some physicians
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  - thrive in employed model and others really need
• 12:09
  - to be part of a a independent democratic
• 12:11
  - group.
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  - But what I do worry about
• 12:14
  - is the loss of that choice and that
• 12:16
  - optionality for practice type. Right?
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  - We're getting to a point where
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  - if
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  - the revenue and reimbursement from these services that
• 12:25
  - have already been performed
• 12:27
  - isn't reliably provided,
• 12:29
  - well, the only choice for,
• 12:32
  - working clinically will be as part of,
• 12:35
  - a consolidated entity because
• 12:37
  - it would take that sort of consolidation,
• 12:40
  - in order to, you know, weather the uncertainty
• 12:42
  - of reimbursement.
• 12:43
  - So the nonpayment and the uncertainty
• 12:46
  - presents a very real and present threat to
• 12:49
  - the independent practice of medicine and
• 12:52
  - the optionality of of practice type.
• 12:55
  - Patrick, I always learn something new when we
• 12:56
  - have you on. Thank you so much for
• 12:58
  - spending some time with us. It's great to
• 12:59
  - have you. Yeah. Great to be here. Really
• 13:01
  - appreciate it. And we also want to thank
• 13:02
  - our podcast sponsor, Halo n d. You can
• 13:04
  - tune in to more podcasts from Becker's Healthcare
• 13:06
  - by visiting our podcast page at beckershospitalreview.com.