Legislative Watch: 3 Federal Healthcare Rules Plans Should Watch in 2020

by Matthew Albright, Chief Legislative Affairs Officer, Zelis

Over the coming year, the federal government intends to finalize three sets of proposals in the areas of surprise balance billing, transparency and interoperability.  All of them touch on provider reimbursement, albeit from different angles.

Surprise Balance Billing legislation veers away from specific benchmarks

In 2020, two new states – Washington and Nevada – will join the ranks of the 25 states with surprise balance billing laws.  Other states passed laws in 2019 that expanded their existing prohibitions on balance billing: California now prohibits balance billing for out-of-network air ambulance services, and both New Mexico and Texas expanded their balance bill protections from out-of-network emergency services to include non-emergency services as well.

With a few exceptions, the reimbursement approach at the state level with balance billing laws has been to allow payers and providers to work out reimbursements between themselves before government benchmarks or arbitration are triggered.  California, New York, New Jersey and others have such laws.  Other states, like Colorado and Connecticut, include payer-provider agreement as part of a series of benchmark options.

In contrast, last year Congress appeared to be heading toward a single benchmark for provider reimbursement, the median in-network rate.  However, after spending most of 2019 talking about it and despite bipartisan and bicameral support for such legislation, Congress was not able to come to an agreement before the end of the year.

In fact, by the end of 2019, the policy positions of various Congressional committees on surprise balance billing became more disparate – and further away from the idea of a single benchmark – than they had been all year.

A proposal put forth by the Senate Health, Education, Labor and Pensions Committee (HELP) and the House Energy and Commerce Committee in December suggested a benchmark of at least the median in-network rate, indicating that providers could bill and be paid more.  A counter proposal from the House Ways and Means Committee came out a few days later but proposed allowing payers and providers to come to agreement among themselves (like many of the states) and use a “robust reconciliation process” only if they could not agree.

Stay tuned: Washington’s next chance to get a balance billing law passed will be in late May when Congress is due to renew unrelated health programs within a broader healthcare package.

The Transparency in Coverage proposed rule puts requirements on payers

The Centers for Medicare & Medicaid Services (CMS) unexpectedly published a proposed rule at the end of November requiring all health plans to:

  1. Create a kind of pre-service explanation of benefits (EOB) online tool for plan members that can estimate what a member’s out-of-pocket costs may be (includes provider-specific negotiated rates), and
  2. Maintain a monthly data dump of the plan’s negotiated rates and allowed amounts for out-of-network.  This data dump is not meant for consumers, but rather for “innovators,” researchers and regulators.

A similar final transparency rule published the same day required hospitals to publish similar information, including negotiated rates with plans.  Within days, the administration was sued by hospital associations on the requirements, and we can expect similar litigation activity with the Transparency in Coverage rule.

The final rule is expected later this year.

The final Interoperability Rule is expected to put data requirements on Medicare Advantage and other plans

The proposed Interoperability Rule came out nearly a year ago, and the final rule, currently on the last step of the government’s review process, is expected any day.  The proposed rule requires Medicare Advantage plans, Medicaid Managed Care plans and Qualified Health Plans (QHPs) in Federally-facilitated Exchanges to create “openly published” application programming interfaces, or APIs, that allow third-party retrieval – with permission from the patient – of clinical and payment information.  Medicare Advantage plans must also provide API access to their provider directories.

CMS hopes that commercial payers will voluntarily design APIs that provide access to similar information.  In the coming years, we may see state laws require commercial plans to do just that.

While balance billing, transparency and interoperability are good election year buzzwords, the devil, as they say, is in 6-point type, deep in the back pages of proposed regulations and legislation.