[Federal Register Volume 88, Number 212 (Friday, November 3, 2023)]
[Proposed Rules]
[Pages 75744-75888]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-23716]
[[Page 75743]]
Vol. 88
Friday,
No. 212
November 3, 2023
Part III
Office of Personnel Management
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5 CFR Part 890
Department of the Treasury
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Internal Revenue Service
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26 CFR Part 54
Department of Labor
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Employee Benefits Security Administration
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29 CFR Part 2590
Department of Health and Human Services
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Centers for Medicare & Medicaid Services
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45 CFR Part 149
Federal Independent Dispute Resolution Operations; Proposed Rule
Federal Register / Vol. 88 , No. 212 / Friday, November 3, 2023 /
Proposed Rules
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OFFICE OF PERSONNEL MANAGEMENT
5 CFR Part 890
RIN 3206-AO48
DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Part 54
[REG-122319-22]
RIN 1545-BQ55
DEPARTMENT OF LABOR
Employee Benefits Security Administration
29 CFR Part 2590
RIN 1210-AC17
DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services
45 CFR Part 149
[CMS-9897-P]
RIN 0938-AV15
Federal Independent Dispute Resolution Operations
AGENCY: Office of Personnel Management; Internal Revenue Service,
Department of the Treasury; Employee Benefits Security Administration,
Department of Labor; Centers for Medicare & Medicaid Services,
Department of Health and Human Services.
ACTION: Notice of proposed rulemaking.
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SUMMARY: This document sets forth proposed rules related to certain
provisions of the No Surprises Act regarding the Federal independent
dispute resolution (IDR) process, which was established as part of the
Consolidated Appropriations Act, 2021 (CAA). These proposed rules would
set forth new requirements relating to the disclosure of information
that group health plans and health insurance issuers offering group or
individual health insurance coverage must include along with the
initial payment or notice of denial of payment for certain items and
services subject to the surprise billing protections in the No
Surprises Act. These proposed rules would also require plans and
issuers to communicate information by using claim adjustment reason
codes (CARCs) and remittance advice remark codes (RARCs), as specified
in guidance, when providing any paper or electronic remittance advice
to an entity that does not have a contractual relationship with the
plan or issuer. This document also proposes to amend certain
requirements related to the open negotiation period preceding the
Federal IDR process, the initiation of the Federal IDR process, the
Federal IDR dispute eligibility review, and the payment and collection
of administrative fees and certified IDR entity fees. This document
also proposes to define bundled payment arrangements, amend
requirements related to batched items and services, and amend the rules
for extensions of timeframes due to extenuating circumstances.
Additionally, this document proposes to require plans and issuers to
register in the Federal IDR portal. In accordance with Federal law, a
summary of these rules may be found at https://www.regulations.gov/.
DATES: To be assured consideration, comments must be received at one of
the addresses provided below by January 2, 2024.
ADDRESSES: Written comments may be submitted to the addresses specified
below. Any comment that is submitted will be shared among the
Department of the Treasury, the Department of Labor, the Department of
Health and Human Services (the Departments), and the Office of
Personnel Management. Please do not submit duplicates.
Comments will be made available to the public. Warning: Do not
include any personally identifiable information (such as name, address,
or other contact information) or confidential business information that
you do not want publicly disclosed. Comments are posted on the internet
exactly as received and can be retrieved by most internet search
engines. No deletions, modifications, or redactions will be made to the
comments received, as they are public records. Comments may be
submitted anonymously.
In commenting, refer to file code RIN 0938-AV15. Because of staff
and resource limitations, the Departments cannot accept comments by
facsimile (FAX) transmission.
Comments, including mass comment submissions, must be submitted in
one of the following three ways (please choose only one of the ways
listed):
1. Electronically. You may submit electronic comments on this
regulation to https://www.regulations.gov. Follow the ``Submit a
comment'' instructions.
2. By regular mail. You may mail written comments to the following
address ONLY: Centers for Medicare & Medicaid Services, Department of
Health and Human Services, Attention: CMS-9897-P, P.O. Box 8016,
Baltimore, MD 21244-8016.
Please allow sufficient time for mailed comments to be received
before the close of the comment period.
3. By express or overnight mail. You may send written comments to
the following address ONLY: Centers for Medicare & Medicaid Services,
Department of Health and Human Services, Attention: CMS-9897-P, Mail
Stop C4-26-05, 7500 Security Boulevard, Baltimore, MD 21244-1850.
For information on viewing public comments, see the beginning of
the SUPPLEMENTARY INFORMATION section.
FOR FURTHER INFORMATION CONTACT: Padma Babubhai Shah, Office of
Personnel Management, at 202-606-4056; Shira B. McKinlay, Internal
Revenue Service, Department of the Treasury, at 202-317-5500; Elizabeth
Schumacher or Shannon Hysjulien, Employee Benefits Security
Administration, Department of Labor, at 202-693-8335; Zarah Ghiasuddin
or Bryan Kirk, Centers for Medicare & Medicaid Services, Department of
Health and Human Services, at 301-492-4308.
Customer Service Information: Information from the Office of
Personnel Management (OPM) on health benefits plans offered under the
Federal Employees Health Benefits (FEHB) Program can be found on the
OPM website (http://www.opm.gov/healthcare-insurance/healthcare/).
Individuals interested in obtaining information from the Department of
Labor (DOL) concerning employment-based health coverage laws may call
the Employee Benefits Security Administration (EBSA) Toll-Free Hotline
at 1-866-444-EBSA (3272) or visit the DOL's website (www.dol.gov/agencies/ebsa). In addition, information from the Department of Health
and Human Services (HHS) on private health insurance coverage and
coverage provided by non-Federal governmental group health plans can be
found on the Centers for Medicare & Medicaid Services (CMS) website
(http://www.cms.gov/marketplace), information on health care reform can
be found at http://www.healthcare.gov, and information on surprise
medical bills can be found at http://www.cms.gov/nosurprises.
SUPPLEMENTARY INFORMATION:
Inspection of Public Comments: Comments received before the close
of the comment period are available for viewing by the public,
including any personally identifiable or confidential
[[Page 75745]]
business information that is included in a comment. The Departments
post comments received before the close of the comment period on the
following website as soon as possible after they have been received:
http://www.regulations.gov. Follow the search instructions on that
website to view public comments. The Departments will not post on
Regulations.gov public comments that make threats to individuals or
institutions or suggest that the commenter will take actions to harm an
individual. The Departments continue to encourage individuals not to
submit duplicative comments. The Departments will post acceptable
comments from multiple unique commenters even if the content is
identical or nearly identical to other comments.
I. Background
A. Preventing Surprise Medical Bills and Establishing the Federal IDR
Process Under the Consolidated Appropriations Act, 2021
On December 27, 2020, the Consolidated Appropriations Act, 2021
(CAA) was enacted.\1\ Title I, also known as the No Surprises Act, and
title II (Transparency) of Division BB of the CAA amended chapter 100
of the Internal Revenue Code (Code), Part 7 of the Employee Retirement
Income Security Act (ERISA), and title XXVII of the Public Health
Service Act (PHS Act). The No Surprises Act provides Federal
protections against surprise billing by limiting out-of-network cost
sharing and prohibiting balance billing in many of the circumstances in
which surprise bills most frequently arise. In particular, the No
Surprises Act added new provisions applicable to group health plans and
health insurance issuers offering group or individual health insurance
coverage. Section 102 of the No Surprises Act added section 9816 of the
Code, section 716 of ERISA, and section 2799A-1 of the PHS Act, which
contain limitations on cost sharing and requirements regarding the
timing of initial payments and notices of denial of payment by plans
and issuers for emergency services furnished by nonparticipating
providers and nonparticipating emergency facilities, and for non-
emergency services furnished by nonparticipating providers with respect
to patient visits to participating health care facilities, generally
defined as hospitals, hospital outpatient departments, critical access
hospitals, and ambulatory surgical centers.\2\
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\1\ Public Law 116-260 (Dec. 27, 2020).
\2\ Section 102(d)(1) of the No Surprises Act amended the
Federal Employees Health Benefits Act, 5 U.S.C. 8901 et seq., by
adding a new subsection (p) to 5 U.S.C. 8902. Under this new
provision, each FEHB Program contract must require a carrier to
comply with requirements described in sections 9816 and 9817 of the
Code, sections 716 and 717 of ERISA, and sections 2799A-1 and 2799A-
2 of the PHS Act (as applicable) in the same manner as these
provisions apply with respect to a group health plan or health
insurance issuer offering group or individual health insurance
coverage.
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Section 103 of the No Surprises Act established a Federal IDR
process that plans and issuers and nonparticipating providers and
facilities may utilize to resolve certain disputes regarding out-of-
network rates under section 9816 of the Code, section 716 of ERISA, and
section 2799A-1 of the PHS Act.
Section 105 of the No Surprises Act added section 9817 of the Code,
section 717 of ERISA, and section 2799A-2 of the PHS Act. These
sections contain limitations on cost sharing and requirements for the
timing of initial payments and notices of denial of payment by plans
and issuers for air ambulance services furnished by nonparticipating
providers of air ambulance services and allow plans and issuers and
nonparticipating providers of air ambulance services to utilize the
Federal IDR process.
The No Surprises Act also added provisions to title XXVII of the
PHS Act in a new part E that apply to health care providers,
facilities, and providers of air ambulance services, such as
prohibitions on balance billing for certain items and services and
requirements related to disclosures about balance billing protections.
The Departments of the Treasury, Labor, and HHS (the Departments),
along with the Office of Personnel Management (OPM), are issuing
regulations in phases that implement provisions of the No Surprises Act
and have issued multiple rulemakings since 2021 to implement various
provisions. More specifically relevant to this proposed rulemaking, the
Departments and OPM issued interim final rules (July 2021 interim final
rules \3\ and October 2021 interim final rules),\4\ and the Departments
issued final rules (August 2022 final rules) \5\ implementing
provisions of sections 9816 and 9817 of the Code, sections 716 and 717
of ERISA, and sections 2799A-1 and 2799A-2 of the PHS Act. These rules
implement provisions to protect consumers from surprise medical bills
for emergency services, non-emergency services furnished by
nonparticipating providers with respect to patient visits to
participating facilities \6\ in certain circumstances, and air
ambulance services furnished by nonparticipating providers of air
ambulance services. These rules also implement provisions to establish
a Federal IDR process to determine payment amounts when there is a
dispute between plans or issuers and providers, facilities, or
providers of air ambulance services about the out-of-network rate for
these services in cases where a specified State law or an applicable
All-Payer Model Agreement does not provide a method for determining the
total amount payable.
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\3\ 86 FR 36872 (July 13, 2021).
\4\ 86 FR 55980 (Oct. 7, 2021).
\5\ 87 FR 52618 (Aug. 26, 2022).
\6\ References to a ``participating facility'' in this preamble
mean a ``participating health care facility,'' as defined at 26 CFR
54.9816-3T, 29 CFR 2590.716-3, and 45 CFR 149.30.
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The July 2021 interim final rules and October 2021 interim final
rules generally apply to plans and issuers (including grandfathered
health plans) for plan years (in the individual market, policy years)
beginning on or after January 1, 2022, and to health care providers,
facilities, and providers of air ambulance services for items and
services furnished during plan years (in the individual market, policy
years) beginning on or after January 1, 2022.\7\ The August 2022 final
rules became effective October 25, 2022, and are applicable for items
and services provided or furnished on or after October 25, 2022, for
plan years (in the individual market, policy years) beginning on or
after January 1, 2022. As discussed in sections I.D and I.F of this
preamble, certain provisions of these rules relating to the methodology
for calculating the qualifying payment amount (QPA), the information
that a certified IDR entity must consider in making a payment
determination, the establishment of the administrative fee to use the
IDR process, and certain restrictions on the qualified IDR items or
services that may be considered jointly as part of a batched
determination have been vacated \8\ by
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the United States District Court for the Eastern District of Texas
(District Court). On September 26, 2023, the Departments published the
Federal IDR Process Administrative Fee and Certified IDR Entity Fee
Ranges Proposed Rules (IDR Process Fees proposed rules) \9\ to amend
the administrative fee and certified IDR entity fee provisions in the
October 2021 interim final rules to provide additional guidance and
promote transparency in the administrative fee calculation and
certified IDR fee ranges. If finalized, the rules would apply for
disputes initiated on or after the later of the effective date or
January 1, 2024.
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\7\ The interim final rules also include interim final
regulations under 5 U.S.C. 8902(p) issued by OPM that specify how
certain provisions of the No Surprises Act apply to health benefit
plans offered by carriers under the Federal Employees Health
Benefits Act. These provisions apply to carriers in the FEHB Program
with respect to contract years beginning on or after January 1,
2022. The disclosure requirements at 45 CFR 149.430 regarding
patient protections against balance billing are applicable as of
January 1, 2022.
\8\ See Tex. Med. Ass'n, et al. v. U.S. Dep't of Health and
Human Servs., 587 F. Supp. 3d 528 (E.D. Tex. 2022) (TMA I), Tex.
Med. Ass'n, et al. v. U.S. Dep't of Health and Human Servs., Case
No. 6:22-cv-372 (E.D. Tex.) (Feb. 6, 2023) (TMA II), Tex. Med.
Ass'n, et al. v. U.S. Dep't of Health and Human Servs., Case No.
6:22-cv-450-JDK (E.D. Tex. Aug. 24, 2023) (TMA III), and Tex. Med.
Ass'n, et al. v. U.S. Dep't of Health and Human Servs., Case No.
6:23-cv-00059-JDK, (E.D. Tex. Aug. 3, 2023) (TMA IV).
\9\ 88 FR 65888 (Sept. 26, 2023).
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B. July 2021 Interim Final Rules
The July 2021 interim final rules implement sections 9816(a)-(b)
and 9817(a) of the Code, sections 716(a)-(b) and 717(a) of ERISA, and
sections 2799A-1(a)-(b), 2799A-2(a), 2799A-7, 2799B-1, 2799B-2, 2799B-
3, and 2799B-5 of the PHS Act.
The No Surprises Act directs the Departments to specify the
information that a plan or issuer must share with a nonparticipating
provider or nonparticipating emergency facility when determining the
QPA. Therefore, 26 CFR 54.9816-6T(d), 29 CFR 2590.716-6(d), and 45 CFR
149.140(d) require that plans and issuers make certain disclosures
about the QPA with each initial payment or notice of denial of payment,
and that plans and issuers provide certain additional information upon
the request of the provider, facility, or provider of air ambulance
services. This information must be provided in writing, either on paper
or electronically, to a nonparticipating provider, facility, or
provider of air ambulance services, as applicable, when the QPA serves
as the recognized amount.
With an initial payment or notice of denial of payment, a plan or
issuer must provide the QPA for each item or service involved, as well
as a statement certifying that based on the determination of the plan
or issuer: (1) the QPA applies for purposes of the recognized amount
(or, in the case of air ambulance services, for calculating the
participant's, beneficiary's, or enrollee's cost sharing), and (2) each
QPA shared with the provider, facility, or provider of air ambulance
services was determined in compliance with the methodology outlined in
the July 2021 interim final rules.\10\
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\10\ 86 FR 36888; 26 CFR 54.9816-6T(d)(1)(iii), 29 CFR 2590.716-
6(d)(1)(iii), and 45 CFR 149.140(d)(1)(iii). For guidance regarding
the certification statement in light of the decision in TMA III, see
U.S. Department of Health and Human Services, U.S. Department of
Labor, U.S. Department of the Treasury, Office of Personnel
Management, FAQs about Consolidated Appropriations Act, 2021
Implementation Part 62 (Oct. 6, 2023), Q3, available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/aca-part-62.pdf and https://www.cms.gov/files/document/faqs-part-62.pdf.
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A plan or issuer is also required to provide a statement that if
the provider, facility, or provider of air ambulance services wishes to
initiate a 30-day open negotiation period for purposes of determining
the amount of total payment, the provider, facility, or provider of air
ambulance services may contact the appropriate person or office to
initiate open negotiation, and that if the 30-day open negotiation
period does not result in an agreement on the payment amount,
generally, the provider, facility, or provider of air ambulance
services may initiate the Federal IDR process within 4 days after the
end of the open negotiation period.\11\ The plan or issuer must provide
contact information, including a telephone number and email address,
for the appropriate office or person for the provider, facility, or
provider of air ambulance services to contact to initiate open
negotiation for purposes of determining a payment amount (inclusive of
cost sharing) for the item or service.\12\
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\11\ 86 FR 36899; 26 CFR 54.9816-6T(d)(1)(iv), 29 CFR 2590.716-
6(d)(1)(iv), and 45 CFR 149.140(d)(1)(iv).
\12\ 86 FR 36899; 26 CFR 54.9816-6T(d)(1)(v), 29 CFR 2590.716-
6(d)(1)(v), and 45 CFR 149.140(d)(1)(v).
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In addition, upon request by the provider or facility,\13\ a plan
or issuer must provide in a timely manner information about whether the
QPA includes contracted rates that were not set on a fee-for-service
basis for the specific items and services and whether the QPA for those
items and services was determined using underlying fee schedule rates
or a derived amount.\14\ If an eligible database was used to determine
the QPA, upon request by the provider or facility, the plan or issuer
must provide information to identify which database was used.\15\
Similarly, if a related service code was used to determine the QPA for
an item or service billed under a new service code, upon request by the
provider or facility the plan or issuer must provide information to
identify which related service code was used.\16\
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\13\ As discussed further in section II.C. of this preamble,
this proposed rule would add a reference to providers of air
ambulance services in 26 CFR 54.9816-6T(d)(2), 29 CFR 2590.716-
6(d)(2), and 45 CFR 149.140(d)(2).
\14\ 26 CFR 54.9816-6T(d)(2)(i), 29 CFR 2590.716-6(d)(2)(i), and
45 CFR 149.140(d)(2)(i). Under the July 2021 interim final rules,
plans and issuers are required to calculate the QPA using underlying
fee schedule rates or derived amounts when the plan or issuer has
sufficient information to calculate the median of its contracted
rates but the payments under the contractual agreements are not on a
fee-for-service basis (such as bundled or capitation payments). 86
FR 36893; 26 CFR 54.9816-6T(b)(2)(iii), 29 CFR 2590.716-
6(b)(2)(iii), 45 CFR 149.140(b)(2)(iii). Plans and issuers are not
otherwise permitted to use underlying fee schedule rates or derived
amounts to calculate the QPA.
\15\ 86 FR 36899; 26 CFR 54.9816-6T(d)(2)(ii), 29 CFR 2590.716-
6(d)(2)(ii), and 45 CFR 149.140(d)(2)(ii).
\16\ 86 FR 36899; 26 CFR 54.9816-6T(d)(2)(iii), 29 CFR 2590.716-
6(d)(2)(iii), and 45 CFR 149.140(d)(2)(iii).
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Finally, upon request by the provider or facility, the plan or
issuer must provide a statement, if applicable, that the plan's or
issuer's contracted rates include risk-sharing, bonus, penalty, or
other incentive-based or retrospective payments or payment adjustments
that were excluded for purposes of calculating the QPA for the items
and services involved.\17\
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\17\ 86 FR 36899; 26 CFR 54.9816-6T(d)(2)(iv), 29 CFR 2590.716-
6(d)(2)(iv), and 45 CFR 149.140(d)(2)(iv).
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C. October 2021 Interim Final Rules and Related Guidance
The October 2021 interim final rules implement the Federal IDR
process under sections 9816(c) and 9817(b) of the Code, sections 716(c)
and 717(b) of ERISA, and sections 2799A-1(c) and 2799A-2(b) of the PHS
Act. The Federal IDR process may be used by group health plans and
health insurance issuers offering group or individual health insurance
coverage and nonparticipating providers, facilities, and providers of
air ambulance services to determine the out-of-network rate for certain
items and services. These are emergency services, non-emergency
services furnished by nonparticipating providers for patient visits to
certain participating facilities (unless an individual has been
provided notice and waived the individual's balance billing
protections, in accordance with 45 CFR 149.410 or 149.420, as
applicable), and air ambulance services furnished by nonparticipating
providers of air ambulance services, for situations in which neither an
All-Payer Model Agreement under section 1115A of the Social Security
Act nor a specified State law as defined in 26 CFR 54.9816-3T, 29 CFR
2590.716-3, and 45 CFR 149.30 applies.
To implement the Federal IDR process, the October 2021 interim
final
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rules include requirements governing the 30-business-day open
negotiation period; the initiation of the Federal IDR process; the
Federal IDR process following initiation, including the selection of a
certified IDR entity, submission of offers, payment determinations, and
written decisions; costs of the Federal IDR process; certification of
IDR entities, including the denial or revocation of certification of an
IDR entity; and the collection of information related to the Federal
IDR process from certified IDR entities to satisfy reporting
requirements under the statute.
To be eligible for the Federal IDR process, the subject of the
dispute must be a qualified IDR item or service as defined in 26 CFR
54.9816-8T(a)(2)(xi), 29 CFR 2590.716-8(a)(2)(xi), and 45 CFR
149.510(a)(2)(xi). The October 2021 interim final rules define
``qualified IDR item or service'' to mean an emergency service
furnished by a nonparticipating provider or nonparticipating facility
subject to the protections of 26 CFR 54.9816-4T, 29 CFR 2590.716-4, or
45 CFR 149.110, for which the exception under 45 CFR 149.410(b)
(regarding receipt of notice and consent to waive surprise billing
protections) does not apply. A qualified IDR item or service may also
be an item or service furnished by a nonparticipating provider at a
participating health care facility subject to the requirements of 26
CFR 54.9816-5T, 29 CFR 2590.716-5, and 45 CFR 149.120, for which the
exception under 45 CFR 149.420(c)-(i) (regarding receipt of notice and
consent to waive surprise billing protections) does not apply. For an
item or service to be considered a qualified IDR item or service, the
provider, facility, or provider of air ambulance services or plan or
issuer, as applicable, must submit a valid notice of IDR initiation
through the Federal IDR portal for the item or service. The notice of
IDR initiation is not valid if the 30-business-day open negotiation
period under 26 CFR 54.9816-8T(b)(1), 29 CFR 2590.716-8(b)(1), and 45
CFR 149.510(b)(1) has not elapsed or an agreement on the payment amount
has been reached. The term ``qualified IDR item or service'' also
includes air ambulance services furnished by nonparticipating providers
of air ambulance services subject to the protections of 26 CFR 54.9817-
1T, 29 CFR 2590.717-1, and 45 CFR 149.130, as these services are
defined in 26 CFR 54.9816-3T, 29 CFR 2590.716-3, and 45 CFR 149.30, for
which the open negotiation period under 26 CFR 54.9816-8T(b)(1), 29 CFR
2590.716-8(b)(1), and 45 CFR 149.510(b)(1) has elapsed, no agreement on
the payment amount has been reached, and a valid notice of IDR
initiation has been submitted after the 30-business-day open
negotiation period has been satisfied.
The term ``qualified IDR item or service'' does not include items
and services for which the out-of-network rate is determined by an All-
Payer Model Agreement under section 1115A of the Social Security Act or
by reference to a specified State law. Additionally, this term does not
include an item or service submitted by the initiating party that is
subject to the 90-calendar-day suspension period (also referred to as
the ``cooling-off period'') under 26 CFR 54.9816-8T(c)(4)(vii)(B), 29
CFR 2590.716-8(c)(4)(vii)(B), and 45 CFR 149.510(c)(4)(vii)(B) except
to the extent that it is submitted during the subsequent 30-business-
day period, as allowed under the October 2021 interim final rules.\18\
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\18\ In the case of a determination made by a certified IDR
entity, the party that submitted the initial notification initiating
the Federal IDR process may not submit a subsequent notification
involving the same other party with respect to a claim for the same
or similar item or service that was the subject of the initial
notification during the 90-calendar-day period following the
determination (the ``cooling off period'').
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The open negotiation period may be initiated by either party during
the 30-business-day period beginning on the day the nonparticipating
provider, facility, or nonparticipating provider of air ambulance
services receives either an initial payment or a notice of denial of
payment for an item or service.\19\ In order for a plan, issuer,
provider, facility, or provider of air ambulance services to know when
it is a party to an open negotiation and the item or service for which
the payment is to be negotiated, the party initiating the open
negotiation period must provide written notice to the other party of
its intent to negotiate using a standardized form, referred to as an
open negotiation notice. The open negotiation notice must include
information sufficient to identify the item or service subject to
negotiation, including the date the item or service was furnished, the
service code, the initial payment amount or notice of denial of
payment, as applicable, an offer for the out-of-network rate, and the
contact information of the party sending the open negotiation notice.
The open negotiation notice must be sent during the 30-business-day
period beginning on the day the initial payment or notice of denial of
payment from the plan or issuer regarding such item or service was
received and must be provided in writing. The party sending the open
negotiation notice may satisfy this requirement by providing the notice
to the opposing party electronically (such as by email) if the
following two conditions are satisfied: (1) the party sending the open
negotiation notice has a good faith belief that the electronic method
is readily accessible to the other party; and (2) the notice is
provided in paper form free of charge upon request. The 30-business-day
open negotiation period begins on the day on which the open negotiation
notice is first sent by a party.
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\19\ As clarified in the July 2021 interim final rules, the
initial payment should be an amount that the plan or issuer
reasonably intends to be payment in full based on the relevant facts
and circumstances, prior to the beginning of any open negotiations
or initiation of the Federal IDR process. See 86 FR 36900-36901.
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As stated in the preamble to the October 2021 interim final rules,
parties should be able to provide effective notice because the parties
have already made initial contact (that is, the provider, facility, or
provider of air ambulance services has transmitted a bill to the plan
or issuer, and the plan or issuer sent an initial payment or a notice
of denial of payment to the provider, facility, or provider of air
ambulance services).\20\ The Departments encouraged the parties to take
reasonable measures to ensure that actual notice is provided, such as
by confirming that the email address is correct, and cautioned that if
the open negotiation notice is not properly provided to the other party
(and no reasonable measures have been taken to ensure actual notice has
been provided), the Departments or a certified IDR entity may determine
that the 30-business-day open negotiation period has not begun. In such
a case, any subsequent payment determination from a certified IDR
entity may be unenforceable due to the failure of the party sending the
open negotiation notice to meet the open negotiation requirement of the
October 2021 interim final rules. In guidance, the Departments
clarified how a provider, facility, or provider of air ambulance
services should proceed if the plan or issuer fails to disclose
information necessary to initiate the open negotiation period when
providing the initial payment or notice of denial of payment and
whether providers, facilities, or providers of air ambulance services
are required to use a plan's or issuer's online portal to submit an
open negotiation notice.\21\
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\20\ 86 FR 55980, 55990.
\21\ See U.S. Department of Health and Human Services, U.S.
Department of Labor, and U.S. Department of the Treasury FAQs about
Affordable Care Act and Consolidated Appropriations Act, 2021
Implementation Part 55, Q20 and Q21 (Aug. 19, 2022), available at
https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/aca-part-55.pdf and https://www.cms.gov/files/document/faqs-part-55.pdf.
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[[Page 75748]]
The October 2021 interim final rules provide that if the parties
have not negotiated an agreement on the out-of-network rate by the last
day of the open negotiation period, either party may initiate the
Federal IDR process during the 4-business-day period beginning on the
31st business day after the start of the open negotiation period.\22\
To initiate the Federal IDR process, the initiating party must submit
the standard notice of IDR initiation to the other party and to the
Departments. As stated in the preamble of the October 2021 interim
final rules, this notice must be provided to the Departments and the
other party on the same day.\23\ The notice of IDR initiation must
include: (1) information sufficient to identify the qualified IDR items
and services (and whether the qualified IDR items or services are
designated as batched items and services), including the furnishing
date(s) and location(s) of the item or service, the type of qualified
IDR item or service (such as emergency services, post-stabilization
professional services, hospital-based services), corresponding service
and place-of-service code(s), the amount of cost sharing allowed, and
the amount of the initial payment made by the plan or issuer for the
qualified IDR item or service, if applicable; (2) the names and contact
information of the parties involved, including email addresses, phone
numbers, and mailing addresses; (3) the State where the qualified IDR
item or service was furnished; (4) the commencement date of the open
negotiation period; (5) the initiating party's preferred certified IDR
entity; (6) an attestation that the item or service is a qualified IDR
item or service within the scope of the Federal IDR process; (7) the
QPA; (8) information about the QPA as described in 26 CFR 54.9816-
6T(d), 29 CFR 2590.716-6(d), and 45 CFR 149.140(d); and (9) general
information describing the Federal IDR process as specified by the
Departments.\24\ The general information should include a description
of the scope of the Federal IDR process and key deadlines in the
Federal IDR process, including the dates to initiate the Federal IDR
process, how to select a certified IDR entity, and the process for
selecting an offer.\25\ The Departments have developed a form that
parties must use to satisfy this requirement to provide general
information describing the Federal IDR process.
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\22\ 86 FR 55991; 26 CFR 54.9816-8T(b)(2)(i), 29 CFR 2590.716-
8(b)(2)(i), and 45 CFR 149.510(b)(2)(i).
\23\ 86 FR 55991.
\24\ 26 CFR 54.9816-8T(b)(2)(iii)(A), 29 CFR 2590.716-
8(b)(2)(iii)(A), and 45 CFR 149.510(b)(2)(iii)(A).
\25\ 86 FR 55991.
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Under section 9816(c)(1)(B) of the Code, section 716(c)(1)(B) of
ERISA, and section 2799A-1(c)(1)(B) of the PHS Act, the date of
initiation of the Federal IDR process is the date of the submission of
the notice of IDR initiation or another date specified by the
Departments that is not later than the date of receipt of the notice of
IDR initiation by both the other party to the dispute and the
Departments. The October 2021 interim final rules establish that the
initiation date of the Federal IDR process is the date of receipt of
the notice of IDR initiation by the Departments.\26\
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\26\ Id.
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Under the October 2021 interim final rules, the plan or issuer and
the nonparticipating provider, nonparticipating emergency facility, or
nonparticipating provider of air ambulance services (as applicable) may
jointly select a certified IDR entity no later than 3 business days
following the date of the IDR initiation.\27\ As previously stated, the
initiating party will select its preferred certified IDR entity in the
notice of IDR initiation. The party in receipt of the notice of IDR
initiation (non-initiating party) may agree or object to the preferred
certified IDR entity identified by the initiating party in the notice
of IDR initiation. If the non-initiating party does not object within 3
business days of the date of initiation of the Federal IDR process, the
preferred certified IDR entity identified in the notice of IDR
initiation will be the selected certified IDR entity, provided that the
certified IDR entity does not have a conflict of interest. If the non-
initiating party objects, that party must timely notify the initiating
party of the objection and propose an alternative preferred certified
IDR entity. The initiating party must then agree or object to the
alternative preferred certified IDR entity. If the initiating party
fails to object to the alternative preferred certified IDR entity
within 3 business days of the date of initiation of the Federal IDR
process, the alternative preferred certified IDR entity proposed by the
non-initiating party will be the selected certified IDR entity,
provided that the certified IDR entity does not have a conflict of
interest. If both parties agree on and select a certified IDR entity or
fail to agree upon a certified IDR entity within the specified
timeframe, the initiating party must notify the Departments by
electronically submitting the notice of the certified IDR entity
selection or failure to select (as applicable), no later than 1
business day after the end of the 3-business-day period (or in other
words, 4 business days after the date of initiation of the Federal IDR
process) through the Federal IDR portal. If the parties fail to jointly
select a certified IDR entity, the Departments will then randomly
select a certified IDR entity not later than 6 business days after the
date of initiation of the Federal IDR process and will notify the
parties of the selection. In addition, in instances in which the non-
initiating party believes that an item or service is not eligible for
the Federal IDR process, the non-initiating party must notify the
Departments through the Federal IDR portal within the same timeframe
that the notice of certified IDR entity selection or failure to select
is required (or in other words, 4 business days after the date of
initiation of the Federal IDR process) and provide information that
demonstrates why an item or service is not eligible for the Federal IDR
process.
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\27\ 86 FR 55991 through 55992, 26 CFR 54.9816-8T(c)(1)(i), 29
CFR 2590.716-8(c)(1)(i), and 45 CFR 149.510(c)(1)(i).
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After being notified of selection (either by the parties or the
Departments), certified IDR entities are required within 3 business
days of selection to attest that they do not have a conflict of
interest as specified under 26 CFR 54.9816-8T(c)(1)(ii), 29 CFR
2590.716-8(c)(1)(ii), and 45 CFR 149.510(c)(1)(ii). Certified IDR
entities are also required to review the information submitted in the
notice of IDR initiation and any additional requested information to
determine whether the dispute is for a qualified IDR item or service,
as defined in 26 CFR 54.9816-8T(a)(2)(xi), 29 CFR 2590.716-8(a)(2)(xi),
and 45 CFR 149.510(a)(2)(xi), that is eligible for the Federal IDR
process, including whether an All-Payer Model Agreement or specified
State law applies. If an item or service is not a qualified IDR item or
service eligible for the Federal IDR process, certified IDR entities
must notify the Departments and the parties within 3 business days of
making this determination.
The October 2021 interim final rules provide that, not later than
30 business days after the selection of a certified IDR entity, the
certified IDR entity must select one of the offers submitted by either
party to the dispute to be the out-of-network rate for the qualified
IDR
[[Page 75749]]
item or service.\28\ For each qualified IDR item or service, the total
plan or coverage payment is the amount by which this out-of-network
rate exceeds the cost-sharing amount for the qualified IDR item or
service (with any initial payment made by the plan or issuer counted
toward the total plan or coverage payment).
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\28\ 26 CFR 54.9816-8T(c)(4)(ii), 29 CFR 2590.716-8(c)(4)(ii),
and 45 CFR 149.510(c)(4)(ii).
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The October 2021 interim final rules also provided that, after
considering the QPA, the statutory factors under sections
9816(c)(5)(C)(ii) and 9817(b)(5)(C)(ii) of the Code, sections
716(c)(5)(C)(ii) and 717(b)(5)(C)(ii) of ERISA, and sections 2799A-
1(c)(5)(C)(ii) and 2799A-2(b)(5)(C)(ii) of the PHS Act, additional
information requested by the certified IDR entity from the parties, and
all of the additional credible information submitted by the parties
that was not prohibited information under 26 CFR 54.9816-8T(c)(4)(v),
29 CFR 2590.716-8(c)(4)(v), and 45 CFR 149.510(c)(4)(v), the certified
IDR entity must select the offer closest to the QPA, unless the
certified IDR entity determined that the credible information submitted
by the parties clearly demonstrated that the QPA was materially
different from the appropriate out-of-network rate, or the offers were
equally distant from the QPA but in opposing directions.\29\ In those
situations, the October 2021 interim final rules required the certified
IDR entity to select the offer that the certified IDR entity determined
best represented the value of the item or service, which could be
either party's offer.\30\ However, as discussed in sections I.D. and
I.F. of this preamble, the District Court vacated portions of these
rules related to certified IDR entity determinations.\31\
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\29\ 86 FR 55995.
\30\ Id.
\31\ TMA I and TMA II.
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The October 2021 interim final rules also provide that not later
than 30 business days after the selection of the certified IDR entity,
the certified IDR entity must notify parties to the dispute of the
selection of the offer and provide a written decision,\32\ which must
be submitted to the parties and the Departments through the Federal IDR
portal.\33\
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\32\ 86 FR 55995, 26 CFR 54.9816-8T(c)(4)(ii), 29 CFR 2590.716-
8(c)(4)(ii), and 45 CFR 149.510(c)(4)(ii).
\33\ The Federal IDR portal is available at https://www.nsa-idr.cms.gov and must be used throughout the Federal IDR process to
maximize efficiency and reduce burden.
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Section 9816(c)(3)(A) of the Code, section 716(c)(3)(A) of ERISA,
and section 2799A-1(c)(3)(A) of the PHS Act direct the Departments to
specify criteria under which multiple qualified IDR items and services
are permitted to be considered jointly as part of a single
determination (``batched determination'' or ``batched dispute'') by a
certified IDR entity for purposes of encouraging the efficiency
(including minimizing costs) of the Federal IDR process. These sections
further require that items and services may be considered as part of a
batched determination only if the items and services are furnished by
the same provider or facility; payment for the items and services is
required to be made by the same group health plan or health insurance
issuer; such items and services are related to the treatment of a
similar condition; and the items and services were furnished during the
30-day period following the date on which the first item or service
included in the batched determination was furnished, or during an
alternative period as determined by the Departments, for use in limited
situations, such as by the consent of the parties or in the case of
low-volume items and services, to encourage procedural efficiency and
minimize health plan and provider administrative costs. The October
2021 interim final rules implemented these requirements for batched
determinations at 26 CFR 54.9816-8T(c)(3)(i), 29 CFR 2590.716-
8(c)(3)(i), and 45 CFR 149.510(c)(3)(i), which are subject to the
certified IDR entity fee for batched determinations.\34\
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\34\ 86 FR 55994. See also the October 2021 interim final rules
in which the Departments defined ``batched items and services'' as
``multiple qualified IDR items or services that are considered
jointly as part of one payment determination by a certified IDR
entity for purposes of the Federal IDR process.'' 86 FR 55987
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The October 2021 interim final rules also establish requirements
related to the costs of the Federal IDR process. Under the October 2021
interim final rules, each party must pay a non-refundable
administrative fee for participating in the Federal IDR process.\35\
The certified IDR entity may invoice the parties for the administrative
fee at the time the certified IDR entity is selected, and the parties
must pay the administrative fee by the time of offer submission.\36\
The administrative fee is paid by each party to the certified IDR
entity and remitted to the Departments.\37\ Under the October 2021
interim final rules, the administrative fee was to be established
annually through guidance in a manner such that the total
administrative fees collected for a year are estimated to be equal to
the amount of expenditures estimated to be made by the Departments to
carry out the Federal IDR process for that year.
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\35\ 26 CFR 54.9816-8T(d)(2)(i), 29 CFR 2590.716-8(d)(2)(i), and
45 CFR 149.510(d)(2)(i).
\36\ See Federal Independent Dispute Resolution (IDR) Process
Guidance for Disputing Parties, available at: https://www.cms.gov/files/document/rev-102822-idr-guidance-disputing-parties.pdf.
\37\ 26 CFR 54.9816-8T(e)(2)(ix), 29 CFR 2590.716-8(e)(2)(ix),
and 45 CFR 149.510(e)(2)(ix). The No Surprises Act directed the
Departments to jointly establish one Federal IDR process. To
operationalize the Federal IDR process, HHS collects administrative
fees for all disputes initiated under the Federal IDR process,
including the administrative fees paid in connection with the
Federal IDR process for health plans that are subject to the Code or
ERISA.
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Additionally, under the October 2021 interim final rules, each
party must also pay a certified IDR entity fee to the certified IDR
entity at the time that the party submits its offer.\38\ However, the
non-prevailing party is ultimately responsible for the full certified
IDR entity fee, which is retained by the certified IDR entity for the
services it performed.\39\ The certified IDR entity fee that was paid
by the prevailing party is returned to the prevailing party by the
certified IDR entity within 30 business days following the date of the
payment determination.\40\ If the parties reach an agreement after
initiating the Federal IDR process but before the certified IDR entity
makes a payment determination, the certified IDR entity fee is split
evenly between the parties, unless the parties agree on an alternative
method for allocating the certified IDR entity fee.\41\ Similarly, if
the initiating party withdraws a dispute after a certified IDR entity
has been assigned but before the certified IDR entity makes a payment
determination, responsibility for the certified IDR entity fee is split
evenly between the parties.\42\ In the case of batched determinations,
the certified IDR entity may make different payment determinations for
each qualified IDR item or service under dispute. In these cases, the
party with the fewest determinations in its favor is considered the
non-prevailing party and is responsible for the full certified IDR
entity fee. If each party prevails in an equal number of
determinations, the certified IDR entity fee is split evenly between
the parties. Under the October 2021 interim final rules, the
[[Page 75750]]
Departments set certified IDR entity fee ranges annually through
guidance.
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\38\ 26 CFR 54.9816-8T(d)(1)(ii), 29 CFR 2590.716-8(d)(1)(ii),
and 45 CFR 149.510(d)(1)(ii).
\39\ 26 CFR 54.9816-8T(d)(1)(i), 29 CFR 2590.716-8(d)(1)(i), and
45 CFR 149.510(d)(1)(i).
\40\ 26 CFR 54.9816-8T(d)(1)(ii), 29 CFR 2590.716-8(d)(1)(ii),
and 45 CFR 149.510(d)(1)(ii).
\41\ 26 CFR 54.9816-8T(c)(2)(ii), 29 CFR 2590.716-8(c)(2)(ii),
and 45 CFR 149.510(c)(2)(ii).
\42\ See https://www.cms.gov/cciio/resources/regulations-and-guidance/downloads/patient-provider-dispute-resolution-administrative-fee-cy-2023.pdf.
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D. Litigation Regarding the July 2021 and October 2021 Interim Final
Rules and Related Guidance
On October 28, 2021, the Texas Medical Association, a trade
association representing physicians, and a Texas physician filed a
lawsuit against the Departments and OPM (TMA I),\43\ stating that
certain provisions of the October 2021 interim final rules relating to
the certified IDR entities' consideration of the QPA, as well as
additional factors related to items and services that are not air
ambulance services, should be vacated. Plaintiffs argued that the
October 2021 interim final rules ignored Congress's intent that
certified IDR entities weigh the QPA and other factors without favoring
any factor, and the plaintiffs stated that as a result, the rules would
skew IDR results in favor of plans and issuers. On February 23, 2022,
the District Court issued a memorandum opinion and order that vacated
portions of the October 2021 interim final rules governing aspects of
the Federal IDR process related to non-air ambulance qualified IDR
items or services including: (1) the definition of ``material
difference''; (2) the requirement that a certified IDR entity must
select the offer closest to the QPA unless the certified IDR entity
determines that credible information submitted by either party under 26
CFR 54.9816-8T(c)(4)(i), 29 CFR 2590.716-8(c)(4)(i), and 45 CFR
149.510(c)(4)(i) clearly demonstrates that the QPA is materially
different from the appropriate out-of-network rate for non-air
ambulance qualified IDR items or services, or if the offers are equally
distant from the QPA but in opposing directions; (3) the requirement
that the certified IDR entity may only consider the additional
information submitted by either party to the extent that the credible
information related to the circumstances under 26 CFR 54.9816-
8T(c)(4)(i), 29 CFR 2590.716-8(c)(4)(i), and 45 CFR 149.510(c)(4)(i)
clearly demonstrates that the QPA is materially different from the
appropriate out-of-network rate for non-air ambulance qualified IDR
items or services; (4) the dispute resolution examples; and (5) the
requirement that, if the certified IDR entity does not choose the offer
closest to the QPA, the certified IDR entity's written decision must
include an explanation of the credible information that the certified
IDR entity determined demonstrated that the QPA was materially
different from the appropriate out-of-network rate, based on the
factors certified IDR entities are permitted to consider for the
qualified IDR item or service.\44\
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\43\ Tex. Med. Ass'n, et al. v. U.S. Dep't of Health and Human
Servs., 587 F. Supp. 3d 528 (E.D. Tex. 2022).
\44\ Id.
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On April 27, 2022, LifeNet, Inc., a provider of air ambulance
services, filed a lawsuit against the Departments and OPM (LifeNet)
\45\ seeking the vacatur of additional provisions of the October 2021
interim final rules applicable to air ambulance services. In
particular, LifeNet alleged that the requirement codified in the last
sentence of 26 CFR 54.9817-2T(b)(2), 29 CFR 2590.717-2(b)(2), and 45
CFR 149.520(b)(2), which specifies the certified IDR entity may
consider information submitted by a party only if the information
``clearly demonstrate[s] that the qualifying payment amount is
materially different from the appropriate out-of-network rate,'' should
be vacated. On July 26, 2022, the District Court issued a memorandum
opinion and order vacating this language.\46\
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\45\ LifeNet, Inc. v. U.S. Dep't of Health and Human Servs., 617
F.Supp.3d 547 (E.D. Tex. July 26, 2022).
\46\ Id.
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On November 30, 2022, the Texas Medical Association, Tyler Regional
Hospital, and a Texas physician filed a lawsuit (TMA III) \47\ against
the Departments and OPM, asserting that the July 2021 interim final
rules, including the provisions of the regulations governing the
methodology for calculating the QPA, and certain related guidance
documents were in conflict with the statutory language. On August 24,
2023, the District Court issued a memorandum opinion and order \48\
that vacated certain portions of the July 2021 interim final rules and
associated regulatory provisions \49\ and portions of guidance
documents,\50\ including portions related to the methodology for
calculating the QPA and interpretations for certified IDR entities
related to the processing of disputes for air ambulance services.
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\47\ Tex. Med. Ass'n., et al. v. U.S. Dep't of Health and Human
Servs., Case No. 6:22-cv-00450-JDK (E.D. Tex. November 30, 2022).
\48\ See Memorandum Opinion and Order, Tex. Med. Ass'n., et al.
v. U.S. Dep't of Health and Human Servs., No. 6:22-cv-00450-JDK
(E.D. Tex. August 24, 2023).
\49\ Specifically, the District Court vacated certain provisions
of 54.9816-6T and 54.9817-1T, 29 CFR 2590.716-6 and 2590.717-1, and
45 CFR 149.130 and 149.140. The District Court also vacated 5 CFR
890.114(a), insofar as it requires compliance with the vacated
regulations and guidance.
\50\ Specifically, the District Court vacated FAQs about
Affordable Care Act and Consolidated Appropriations Act, 2021
Implementation Part 55 (Aug. 19, 2022), Q14 and 15, as well as
portions of Technical Guidance for Certified IDR Entities at 2-3
(Aug. 18, 2022).
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On January 30, 2023, the Texas Medical Association, Houston
Radiology Associated, Texas Radiological Society, Tyler Regional
Hospital, and a Texas physician filed a lawsuit (TMA IV) \51\ against
the Departments and OPM, asserting that the December 2022 fee guidance
\52\ and the October 2021 interim final rules were unlawfully issued
without notice and comment rulemaking and were arbitrary and
capricious.\53\ On August 3, 2023, the District Court issued a
memorandum opinion and order \54\ that vacated the portion of the
December 2022 fee guidance increasing the administrative fee for the
Federal IDR process to $350 per party for disputes initiated during the
calendar year beginning January 1, 2023. The District Court also
vacated certain provisions of the October 2021 interim final rules
setting forth the batching criteria under which multiple IDR items or
services are treated as related to the ``treatment of a similar
condition.'' \55\ In light of the TMA IV order, on August 3, 2023, the
Departments instructed certified IDR entities to pause all work in the
Federal IDR portal until the Departments updated Federal IDR process
guidance, systems, and related documents to make them consistent with
the TMA IV order. Subsequently, on August 7, 2023, the Departments
directed certified IDR entities to resume processing all single and
bundled disputes for which the administrative fee had already been paid
and all batched disputes for which the certified IDR entity had already
determined the dispute eligible and
[[Page 75751]]
administrative fees had been paid (or the deadline for collecting fees
had expired) before August 3, 2023.\56\ On August 8, 2023, the
Departments directed certified IDR entities to resume processing single
and bundled disputes initiated in 2022 for which the administrative fee
had not been paid before August 3, 2023. On August 11, 2023, the
Departments released guidance to reflect the TMA IV order related to
the administrative fee and to clarify the administrative fee amount for
2023.\57\ On the same date, the Departments directed certified IDR
entities to resume processing single and bundled disputes initiated in
2023 for which the administrative fees had not been paid before August
3, 2023.
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\51\ Tex. Med. Ass'n., et al. v. U.S. Dep't of Health and Human
Servs., Case No. 6:23-cv-00059-JDK, (E.D. Tex. Jan. 30, 2023).
\52\ Centers for Medicare & Medicaid Services (Dec. 23, 2022).
Amendment to the Calendar Year 2023 Fee Guidance for the Federal
Independent Dispute Resolution Process Under the No Surprises Act:
Change in Administrative Fee. https://www.cms.gov/cciio/resources/regulations-and-guidance/downloads/amended-cy2023-fee-guidance-federal-independent-dispute-resolution-process-nsa.pdf.
\53\ See Motion for Summary Judgment and Reply in Support of
Summary Judgment, p. 1, Tex. Med. Ass'n., et al. v. U.S. Dep't of
Health and Human Servs., No. 6:23-cv-00059-JDK (E.D. Tex. March 27,
2023).
\54\ See Memorandum Opinion and Order, Tex. Med. Ass'n. v. U.S.
Dep't of Health and Hum. Servs, No. 6:23-cv-00059-JDK (E.D. Tex.
August 3, 2023).
\55\ Specifically, the District Court vacated the requirement
under 26 CFR 54.9816-8T(c)(3)(i)(C), 29 CFR 2590.716-8(c)(3)(i)(C),
and 45 CFR 149.510(c)(3)(i)(C) that for a qualified IDR item and
service to be considered the same or similar item and service, it
must be billed under the same service code or a comparable code
under a different procedural code system, such as the Current
Procedural Terminology (CPT) codes with modifiers, if applicable,
Healthcare Common Procedure Coding System (HCPCS) with modifiers, if
applicable, or Diagnosis-Related Group (DRG) codes with modifiers,
if applicable.
\56\ For the purposes of the Federal IDR process, the
Departments in guidance interpreted a bundled payment arrangement to
be an arrangement under which: (1) a provider, facility, or provider
of air ambulance services bills for multiple items or services under
a single service code; or (2) a plan or issuer makes an initial
payment or denial of payment to a provider, facility, or provider of
air ambulance services under a single service code that represents
multiple items or services (e.g., a DRG). See U.S. Department of
Health and Human Services, U.S. Department of Labor, and U.S.
Department of Treasury, Federal Independent Dispute Resolution (IDR)
Process Technical Assistance for Certified IDR Entities, August
2022, available at https://www.cms.gov/files/document/TA-certified-independent-dispute-resolution-entities-August-2022.pdf. These
rules, discussed in section II.A. of this preamble, propose to
codify that definition in the regulations.
\57\ Centers for Medicare & Medicaid Services (Aug. 11, 2023).
Federal Independent Dispute Resolution (IDR) Process Administrative
Fee FAQs. https://www.cms.gov/cciio/resources/regulations-and-guidance/downloads/no-surprises-act-independent-dispute-resolution-administrative-fee-frequently-asked-questions.pdf.
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As a result of the TMA III order issued on August 24, 2023, the
Departments again paused all IDR-related activities in order to
evaluate the District Court's order and review current Federal IDR
processes, templates, and system functions necessary to comply with the
order. On September 5, 2023, the Departments directed certified IDR
entities to resume making eligibility and conflict-of-interest
determinations for all single and bundled disputes submitted on or
before August 3, 2023, and encouraged disputing parties to continue
engaging in open negotiations. On September 21, 2023, the Departments
directed certified IDR entities to resume processing all single and
bundled disputes submitted on or before August 3, 2023. On October 6,
2023, the Departments and OPM released ``FAQs About Consolidated
Appropriations Act, 2021 Implementation Part 62'' \58\ to provide
guidance in light of the TMA III order. On the same day, the
Departments reopened the Federal IDR portal for the initiation of
certain new single and bundled disputes. At the time of this proposed
rulemaking and in accordance with the TMA III and TMA IV orders, the
Departments plan to release guidance to clarify how certified IDR
entities should determine whether a dispute is appropriately batched.
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\58\ See U.S. Department of Health and Human Services, U.S.
Department of Labor, U.S. Department of the Treasury, Office of
Personnel Management, FAQs about Consolidated Appropriations Act,
2021 Implementation Part 62 (Oct. 6, 2023), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/aca-part-62.pdf and https://www.cms.gov/files/document/faqs-part-62.pdf.
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E. August 2022 Final Rules
The August 2022 final rules included amendments to remove from the
regulations the language vacated by the District Court in TMA I and
LifeNet,\59\ as described in section I.D. of this preamble. In
addition, the August 2022 final rules amended and finalized certain
disclosure requirements related to information that plans and issuers
must share about the QPA under the July 2021 interim final rules.\60\
The August 2022 final rules also amended and finalized select
provisions of the October 2021 interim final rules on the information
to be considered by a certified IDR entity when it makes a payment
determination under the Federal IDR process.\61\
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\59\ 87 FR 52622.
\60\ 87 FR 52622-52623.
\61\ 87 FR 52628.
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Specifically, the Departments amended and finalized parts of the
July 2021 and October 2021 interim final rules related to: (1) the
information that must be disclosed about the QPA under 26 CFR 54.9816-
6T(d), 29 CFR 2590.716-6(d), and 45 CFR 149.140(d) to address
downcoding; (2) the certified IDR entity's consideration of the
statutory factors when making a payment determination under the Federal
IDR process at 26 CFR 54.9816-8T(c)(4)(iii)-(iv) and 54.9817-2T(b)(2),
29 CFR 2590.716-8(c)(4)(iii)-(iv) and 2590.717-2(b)(2), and 45 CFR
149.510(c)(4)(iii)-(iv) and 149.520(b)(2); and (3) the certified IDR
entity's written decision at 26 CFR 54.9816-8T(c)(4)(vi)(B), 29 CFR
2590.716-8(c)(4)(vi)(B), and 45 CFR 149.510(c)(4)(vi)(B).
For the information that must be disclosed with the QPA, the August
2022 final rules require that if a QPA is based on a downcoded service
code or modifier, in addition to the information already required to be
provided with an initial payment or notice of denial of payment, a plan
or issuer must provide a statement that the service code or modifier
billed by the provider, facility, or provider of air ambulance services
was downcoded; an explanation of why the claim was downcoded, including
a description of which service codes were altered, if any, and which
modifiers were altered, added, or removed, if any; and the amount that
would have been the QPA had the service code or modifier not been
downcoded. The August 2022 final rules define the term ``downcode,'' as
described in the preamble to the October 2021 interim final rules, to
mean the alteration by a plan or issuer of a service code to another
service code, or the alteration, addition, or removal by a plan or
issuer of a modifier, if the changed code or modifier is associated
with a lower QPA than the service code or modifier billed by the
provider, facility, or provider of air ambulance services.\62\
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\62\ 87 FR 52626.
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The August 2022 final rules also provided that in determining which
offer to select during the Federal IDR process, the certified IDR
entity must consider the QPA for the applicable year for the same or
similar item or service and then must consider all additional
information submitted by a party to determine which offer best reflects
the appropriate out-of-network rate, provided that the information
relates to the party's offer for the payment amount for the qualified
IDR item or service that is the subject of the payment determination
and does not include information that the certified IDR entity is
prohibited from considering in making the payment determination under
section 9816(c)(5)(D) of the Code, section 716(c)(5)(D) of ERISA, and
section 2799A-1(c)(5)(D) of the PHS Act. For this purpose, the preamble
to the August 2022 final rules stated that information requested by a
certified IDR entity, or submitted by a party, would be information
relating to a party's offer if it tends to show that the offer best
represents the value of the item or service under dispute. The August
2022 final rules required the certified IDR entity to evaluate whether
the information relates to the offer submitted by either party for the
payment amount for the qualified IDR item or service that is the
subject of the payment determination. The August 2022 final rules
clarified that in considering this additional information, the
certified IDR entity should evaluate whether the information that is
offered is credible and should not give weight to information that is
not credible. The appropriate out-of-network rate must be the offer
that the certified IDR entity
[[Page 75752]]
determines best represents the value of the qualified IDR item or
service.
Additionally, the August 2022 final rules provided that when
considering the additional information under 26 CFR 54.9816-
8(c)(4)(iii), 29 CFR 2590.716-8(c)(4)(iii), and 45 CFR
149.510(c)(4)(iii), the certified IDR entity should evaluate the
information and should not give weight to that information if it is
already accounted for by any of the other information submitted by the
parties, to avoid weighting the same information twice.
For the written decision, the August 2022 final rules require the
certified IDR entity to include what information the certified IDR
entity used to determine that the offer selected as the out-of-network
rate is the offer that best represents the value of the qualified IDR
item or service, including the weight given to the QPA and any
additional credible information submitted in accordance with the rules.
The August 2022 final rules required that if the certified IDR entity
relied on additional information in selecting an offer, its written
decision must include an explanation of why the certified IDR entity
concluded that this information was not already reflected in the QPA.
F. Litigation Regarding the August 2022 Final Rules
On September 22, 2022, the Texas Medical Association, Tyler
Regional Hospital, a Texas physician, LifeNet, Inc., Air Methods
Corporation, Rocky Mountain Holdings, LLC, and East Texas Air One, LLC
filed a lawsuit against the Departments (TMA II),\63\ asserting that
certain provisions of the August 2022 final rules relating to the
certified IDR entities' consideration of the QPA, as well as additional
factors, should be vacated. Plaintiffs argued that the August 2022
final rules unlawfully conflict with the No Surprises Act in the same
manner as the vacated provisions of the October 2021 interim final
rules--that is, such rules improperly restrict arbitrators' discretion
and unlawfully tilt the arbitration process in favor of the QPA. On
February 6, 2023, the District Court issued a memorandum opinion and
order that vacated portions of the August 2022 final rules related to
the certified IDR entity's consideration of the statutory factors when
making a payment determination under the Federal IDR process at 26 CFR
54.9816-8(c)(4)(iii)-(iv) and 54.9817-2(b)(3), 29 CFR 2590.716-
8(c)(4)(iii)-(iv) and 2590.717-2(b)(3), and 45 CFR 149.510(c)(4)(iii)-
(iv) and 149.520(b)(3) and part of the provision related to the
certified IDR entity's written decision at 26 CFR 54.9816-
8(c)(4)(vi)(B), 29 CFR 2590.716-8(c)(4)(vi)(B), and 45 CFR
149.510(c)(4)(vi)(B). The vacated portions of the rules include: (1)
the requirement that certified IDR entities consider the QPA and then
the additional statutory factors under 26 CFR 54.9816-
8(c)(4)(iii)(B)(1)-(5) and 54.9817-2(b)(3), 29 CFR 2590.716-
8(c)(4)(iii)(B)(1)-(5) and 2590.717-2(b)(3), and 45 CFR
149.510(c)(4)(iii)(B)(1)-(5) and 149.520(b)(3); (2) the provision that
a certified IDR entity should evaluate whether the information
submitted under 26 CFR 54.9816-8(c)(4)(iii)(B)-(D) and 54.9817-2(b)(3),
29 CFR 2590.716-8(c)(4)(iii)(B)-(D) and 2590.717-2(b)(3), and 45 CFR
149.510(c)(4)(iii)(B)-(D) and 149.520(b)(3) is credible and relates to
the offer submitted by either party for the payment amount for the
qualified IDR item or service that is the subject of the payment
determination, and the certified IDR entity should not give weight to
information to the extent it is not credible, it does not relate to
either party's offer for the payment amount for the qualified IDR item
or service, or it is already accounted for by the QPA or another
factor; (3) the dispute resolution examples; and (4) the requirement
that, if the certified IDR entity relies on additional information in
selecting an offer, its written decision must include an explanation of
why the certified IDR entity concluded that this information was not
already reflected in the QPA.
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\63\ Tex. Med. Ass'n, et. al. v. U.S. Dep't of Health and Human
Servs., Case No. 6:22-cv-372 (E.D. Tex. February 06, 2023) (TMA II).
Air Methods Corporation, Rocky Mountain Holdings, LLC, and East
Texas Air One, LLC are providers of air ambulance services.
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As a result of the TMA II order, on February 10, 2023, the
Departments instructed certified IDR entities to hold all payment
determinations until the Departments updated Federal IDR process
guidance, systems, and related documents to make them consistent with
the TMA II order.\64\ Subsequently, the Departments directed certified
IDR entities to resume making payment determinations on February 27,
2023, for disputes involving an item or service furnished before
October 25, 2022 (the effective date of the August 2022 Final
Rules).\65\ On March 17, 2023, the Departments released updated
guidance \66\ to reflect the TMA II order and directed certified IDR
entities to resume making payment determinations in accordance with the
guidance for disputes involving items or services furnished on or after
October 25, 2022.
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\64\ Centers for Medicare & Medicaid Services. (February 10,
2023). Payment Disputes Between Providers and Health Plans, Notices.
https://www.cms.gov/nosurprises/help-resolve-payment-disputes/payment-disputes-between-providers-and-health-plans.
\65\ Centers for Medicare & Medicaid Services. (February 27,
2023). Payment Disputes Between Providers and Health Plans, Notices.
https://www.cms.gov/nosurprises/help-resolve-payment-disputes/payment-disputes-between-providers-and-health-plans.
\66\ Centers for Medicare & Medicaid Services. (March 2023).
Federal Independent Dispute Resolution (IDR) Process for Certified
IDR Entities (Revised). https://www.cms.gov/files/document/federal-idr-guidance-idr-entities-march-2023.pdf and Federal Independent
Dispute Resolution (IDR) Process for Disputing Parties (Revised).
https://www.cms.gov/files/document/federal-idr-guidance-disputing-parties-march-2023.pdf.
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On April 6, 2023, the Departments filed a notice of appeal to the
United States Court of Appeals for the Fifth Circuit from the District
Court's order granting summary judgement to the plaintiffs and denying
summary judgment to the Departments.
G. Federal IDR Process Administrative Fee and Certified IDR Entity Fee
Ranges 2023 Proposed Rules
In light of TMA IV and to promote transparency in the
administrative fee calculation, the Departments published the IDR
Process Fees proposed rules on September 26, 2023. The IDR Process Fees
proposed rules propose to amend the October 2021 interim final rules to
provide that the administrative fee would be set in notice and comment
rulemaking rather than annual guidance, propose an administrative fee
amount that, if finalized, would apply for disputes initiated on or
after the later of the effective date of the IDR Process Fees proposed
rules or January 1, 2024, and propose a methodology that the
Departments would use to calculate the administrative fee in the
future. Additionally, the IDR Process Fees proposed rules would propose
to amend the October 2021 interim final rules to provide that the
certified IDR entity fee ranges for single and batched determinations
would be set in notice and comment rulemaking rather than annual
guidance, propose the certified IDR entity fee ranges for single and
batched determinations, including a fixed tiered fee for batched
disputes, and propose the considerations that the Departments would use
to calculate the certified IDR entity fee ranges in the future. If
finalized, the proposed certified IDR entity fee ranges and fixed
tiered fees would apply for disputes initiated on or after the later of
the effective date of the IDR Process Fees proposed rules or January 1,
2024. If finalized, the proposed administrative fee and certified IDR
entity fee ranges would remain in effect until changed by subsequent
rulemaking.
[[Page 75753]]
H. The Federal IDR Process to Date
On April 15, 2022, the Departments launched the Federal IDR portal
to accept disputes regarding the appropriate out-of-network rate for
claims subject to the surprise billing protections of the No Surprises
Act. From April 15, 2022 to July 1, 2023, disputing parties submitted
over 489,000 disputes. In the first year of operations, disputing
parties submitted 14 times the number of disputes that the Departments
had expected to receive in an entire calendar year.67 68 Due
to this unexpectedly high volume, the limited number of certified IDR
entities,\69\ the complexity of determining disputes' eligibility for
the Federal IDR process, and a large number of ineligible disputes
submitted, it is taking certified IDR entities longer than the
timeframes established under the No Surprises Act and the October 2021
interim final rules to process payment disputes. Further, the District
Court's successive orders have resulted in multiple temporary closures
of the Federal IDR portal, requiring the Departments to alter guidance,
implement significant system updates, and communicate changes to
disputing parties and certified IDR entities to comply with the orders.
These interruptions to the Federal IDR process have exacerbated delays
and required certified IDR entities and disputing parties to rapidly
adjust to changing operations and guidance. Accordingly, a large number
of disputes still await payment determinations.
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\67\ Federal Independent Dispute Resolution Process--Status
update. Available at: https://www.cms.gov/files/document/federal-idr-processstatus-update-april-2023.pdf.
\68\ In the regulatory impact analysis of the October 2021
interim final rules, the Departments estimated that 17,333 disputes
involving non-air ambulance services and 4,899 disputes involving
air ambulance services would be submitted to the Federal IDR process
during the first year of implementation.
\69\ https://www.cms.gov/nosurprises/help-resolve-payment-disputes/certified-idre-list.
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Several factors are likely contributing to the high volume of
initiated disputes. First, providers, facilities, and providers of air
ambulance services \70\ have alleged that plans' and issuers' QPA
calculations are sometimes artificially low and are even at times lower
than Medicare rates. Providers, facilities, and providers of air
ambulance services further allege that plans and issuers are making
initial payments based on these artificially low QPAs, which
incentivizes providers, facilities, and providers of air ambulance
services to use the Federal IDR process for a larger number of items
and services than they otherwise would.
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\70\ For purposes of these proposed rules, unless otherwise
stated, whenever the Departments are referring to providers,
facilities, and providers of air ambulance services, the Departments
are referring to nonparticipating providers, facilities, and
providers of air ambulance services.
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A second factor contributing to the high volume of disputes is that
the disputing parties are not yet able to predict how disputes will be
resolved by certified IDR entities. As the Departments stated in the
preamble to the October 2021 interim final rules, a Federal IDR process
with predictable outcomes will reduce the use of the Federal IDR
process over time because, if outcomes are predictable in advance,
parties will generally prefer to reach an agreement in line with the
predicted outcome outside of the Federal IDR process to avoid the
administrative costs of utilizing the process.
Third, disputing parties are failing to engage in meaningful open
negotiations. Parties representing providers, facilities, providers of
air ambulance services, plans, and issuers have all asserted that they
experience challenges in negotiating with other parties during the 30-
business-day open negotiation period, resulting in low levels of
engagement during open negotiation. This lack of engagement has
resulted in relatively few disputes being settled outside of the
Federal IDR process, contributing to a higher-than-expected volume of
disputes being initiated in the Federal IDR process. As discussed later
in this section, interested parties also shared that the lack of
meaningful engagement in open negotiation contributes to inefficiencies
within the Federal IDR process, because disputing parties that fail to
engage in open negotiation may not exchange information that would
facilitate the Federal IDR process, such as contact information and
other required disclosures, or may exchange only incomplete
information.
Fourth, the District Court's successive rulings have necessitated
multiple temporary shutdowns of the Federal IDR process to comply with
the District Court's orders. Each shutdown has halted parts, or all, of
the Federal IDR process, interrupting the advancement of ongoing
disputes through the process and preventing new disputes from being
submitted. Reopening the Federal IDR portal each time has required the
Departments to draft new guidance, engage in new rulemaking, implement
significant system updates, and communicate changes to disputing
parties and certified IDR entities. These interruptions to the Federal
IDR process have exacerbated delays and required certified IDR entities
and disputing parties to rapidly adjust to changing operations and
guidance, which causes confusion regarding the current state of the
process while certified IDR entities and disputing parties adapt to new
or different processes, such as those discussed in section I.D. of this
preamble related to the TMA III order.
Finally, initiating parties are submitting a large number of
disputes that are not eligible for the Federal IDR process, leading to
both a high volume of dispute submissions and slow processing of
disputes. Certified IDR entities have indicated to the Departments that
determining the eligibility of disputes for the Federal IDR process is
more time-consuming and burdensome than they expected. In fact,
certified IDR entities report spending 50 to 80 percent of their time
working on eligibility determinations. From April 15, 2022 to July 1,
2023, non-initiating parties challenged the eligibility of 190,465
disputes for the Federal IDR process, and certified IDR entities found
59,604 disputes ineligible. A dispute is not eligible for the Federal
IDR process unless it concerns an item or service that meets the
definition of a qualified IDR item or service.\71\ Ineligible disputes
often involve an item or service that is not a qualified IDR item or
service because it is covered by a health plan or coverage that is not
subject to the surprise billing protections of the No Surprises Act,
such as Medicare or Medicaid, or because the item or service is subject
to a specified State law or an All-Payer Model Agreement. Additionally,
many batched disputes were found ineligible due to the initiating party
incorrectly batching items or services in a manner that did not comply
with the regulations, such as batching claims paid by different plans
or issuers.\72\ Certified IDR entities have similarly reported
encountering incorrectly bundled disputes for which providers are
attempting to submit, for example, an emergency room facility code as a
bundled code with various item and service codes included as line
items, rather than properly submitting a single service code (for
example, a Diagnosis-Related Group (DRG) code under which a provider,
facility, or provider of air ambulance services can bill for multiple
items or services).\73\ Disputes are also ineligible when the disputing
parties have failed to satisfy the 30-business-day open negotiation
period requirements specified under 26 CFR
[[Page 75754]]
54.9816-8T(b)(1), 29 CFR 2590.716-8(b)(1), and 45 CFR 149.510(b)(1) or
have failed to initiate the Federal IDR process within 4 business days
after the end of the 30-business-day open negotiation period as
specified under 26 CFR 54.9816-8T(b)(2)(i), 29 CFR 2590.716-8(b)(2)(i),
and 45 CFR 149.510(b)(2)(i).
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\71\ 26 CFR 54.9816-8T(a)(2)(xi), 29 CFR 2590.716-8(a)(2)(xi),
and 45 CFR 149.510 (a)(2)(xi).
\72\ 26 CFR 54.9816-8T(c)(3)(i)(B), 29 CFR 2590.716-
8(c)(3)(i)(B), and 45 CFR 149.510(c)(3)(i)(B).
\73\ 26 CFR 54.9816-8T(c)(3)(ii), 29 CFR 2590.716-8(c)(3)(ii),
and 45 CFR 149.510(c)(3)(ii).
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The Departments' review of the disputes submitted to date and
feedback received from interested parties and certified IDR entities
via letters, email communication and listening sessions shows a pattern
of initiating parties submitting ineligible disputes to the Federal IDR
process due to miscommunication or a lack of communication between the
disputing parties. The Departments intended that sufficient information
would be communicated through the disclosures that plans and issuers
are required to provide with their initial payment or notice of denial
of payment or would be subsequently communicated during the required
30-business-day open negotiation period to identify whether the item(s)
or service(s) involved in the dispute is a qualified IDR item(s) or
service(s). Plans and issuers assert that providers, facilities, and
providers of air ambulance services submit overwhelming numbers of
ineligible disputes that overload the plans' and issuers' ability to
identify and respond to dispute initiations, while providers,
facilities, and providers of air ambulance services assert that plans
and issuers do not provide required contact information and disclosures
in a clear and convenient manner and fail to respond to their notices
initiating open negotiation.
Although plans and issuers are required to provide disclosures with
the initial payment or notice of denial of payment containing
information related to the QPA and contact information to initiate open
negotiations, providers, facilities, and providers of air ambulance
services have reported difficulty locating this information. The
inability of providers, facilities, and providers of air ambulance
services to locate required disclosures has led to confusion about how
they should contact and engage in open negotiations with the plan or
issuer and ultimately submit the dispute to the Federal IDR process. If
disputing parties fail to share the required information, or if they
provide inaccurate information, certified IDR entities will have
incomplete or inaccurate information when making eligibility
determinations. As a result, certified IDR entities must dedicate
additional resources and conduct outreach to determine eligibility.
Many interested parties have stated that the exchange of key
information in a more standardized fashion, such as through the
inclusion of the information on electronic remittance advice (ERA)
transactions, discussed in greater detail in section II.B. of this
preamble, would ensure that disputing parties have timely access to
complete and accurate information and therefore help reduce the number
of ineligible disputes submitted to the Federal IDR process. This is
primarily because disputing parties would have timely access to the
information they need to determine whether (1) an item or service is a
qualified IDR item or service and (2) it is in their interest to
initiate the Federal IDR process regarding such item or service. The
Departments are of the view that timely access to that type of
information would help reduce the overall number of ineligible
disputes, resulting in more manageable workloads for certified IDR
entities and more efficient dispute processing overall.
Additionally, providers and facilities have raised concerns that
the existing disclosure rules do not require plans and issuers to
provide information necessary for determining whether the item or
service is subject to a specified State law, an All-Payer Model
Agreement, or the Federal IDR process for determining the out-of-
network rate. In particular, providers, facilities, and providers of
air ambulance services have identified significant challenges in
determining whether a claim involves a plan that is a self-insured
group health plan subject to ERISA (and, if the claim involves an item
or service covered by the No Surprises Act, is therefore generally
subject to the Federal IDR process) or a fully-insured plan to which a
specified State law or All-Payer Model Agreement may apply.\74\ The
Departments also are aware that there are further challenges in
identifying whether a plan subject to ERISA has opted into a specified
State law and, separately, whether a specific item or service, or
specific provider, facility, or provider of air ambulance services, is
subject to a given specified State law or All-Payer Model Agreement.
Additionally, providers, facilities, and providers of air ambulance
services have identified difficulties in determining the correct legal
business name of the plan or issuer. As a result, when initiating the
Federal IDR process, providers, facilities, and providers of air
ambulance services may initiate their dispute against the wrong party
or may incorrectly batch claims that were paid by different plans or
issuers.
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\74\ The July 2021 interim final rules allow self-insured group
health plans, including self-insured non-Federal governmental plans,
to voluntarily opt in to a State law that provides for a method for
determining the total amount payable under such a plan, where a
State has chosen to expand access to such plans, to satisfy their
obligations under section 9816(a)-(d) of the Code, section 716(a)-
(d) of ERISA, and section 2799A-1(a)-(d) of the PHS Act. A self-
insured plan that has chosen to opt-in to a State law must
prominently display in its plan materials describing the coverage of
out-of-network services a statement that the plan has opted in to a
specified State law, identify the relevant State (or States), and
include a general description of the items and services provided by
nonparticipating facilities, providers, and providers of air
ambulance services that are covered by the specified State law.
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To address the high volume of disputes submitted to the Federal IDR
process and the growing backlog of cases, the Departments have provided
ongoing technical assistance to certified IDR entities and disputing
parties by issuing guidance as well as performing research and outreach
on dispute eligibility determinations.\75\ In addition, the Departments
have implemented Federal IDR portal system enhancements. These system
enhancements, such as enabling non-initiating parties to submit
supporting documentation to contest dispute eligibility within their
response to the notice of IDR initiation, allow the Departments to
collect information regarding dispute eligibility earlier in the
process to identify whether the eligibility requirements are met.
However, despite the efforts to date, the Departments and certified IDR
entities continue to experience challenges related to determining
eligibility for the Federal IDR process, such as delays due to
necessary outreach by the certified IDR entities to the disputing
parties to obtain or verify information regarding the eligibility of a
dispute.
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\75\ U.S. Department of Health and Human Services, U.S.
Department of Labor, and U.S. Department of the Treasury, Federal
Independent Dispute Resolution (IDR) Process Technical Assistance
for Certified IDR Entities, August 2022, available at https://www.cms.gov/files/document/TA-certified-independent-dispute-resolution-entities-August-2022.pdf.
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I. Scope and Purpose of Rulemaking
This proposed rulemaking is intended to address specific issues
that are critical to ensuring the timely rendering of payment
determinations and to address feedback from interested parties and
certified IDR entities to improve the functioning of the Federal IDR
process.
These proposed rules are intended to address some of the common
communication issues between disputing parties, including those
stemming from a lack of clarity as to whether items and services are
qualified IDR items and services covered by the
[[Page 75755]]
No Surprises Act. These proposed rules would impose requirements and
create incentives for parties to engage with one another during the
open negotiation period, which would help reduce the volume of
ineligible disputes being submitted. Specifically, these proposed rules
would make changes to the information that plans, issuers, providers,
facilities, and providers of air ambulance services must share before
initiating the Federal IDR process by including proposals at 26 CFR
54.9816-6A, 29 CFR 2590.716-6A, and 45 CFR 149.100 to require plans and
issuers to provide claim adjustment reason codes (CARCs) and remittance
advice remark codes (RARCs) when providing any paper or electronic
remittance advice in response to a claim for payment for health care
items or services furnished by an entity with which it does not have a
direct or indirect contractual relationship. Additionally, the
Departments propose amendments at 26 CFR 54.9816-6, 29 CFR 2590.716-6,
and 45 CFR 149.140 to the information that must be disclosed about the
QPA. These proposed rules would also establish new requirements at 26
CFR 54.9816-9, 29 CFR 2590.716-9, and 45 CFR 149.530, which would
require plans and issuers to register with the Federal IDR portal to
better enable a provider, facility, or provider of air ambulance
services to identify the appropriate plan or issuer with which it has a
dispute and determine whether its coverage of an item or service that
is the subject of the dispute is subject to a specified State law, an
All-Payer Model Agreement, or the Federal IDR process for determining
the out-of-network rate.
To further facilitate communication and improve open negotiations,
these proposed rules would amend the open negotiation process that
precedes the Federal IDR process. Specifically, at 26 CFR 54.9816-
8(b)(1), 29 CFR 2590.716-8(b)(1), and 45 CFR 149.510(b)(1), these
proposed rules would amend the content requirements of the standard
open negotiation notice, would establish requirements related to an
open negotiation response notice, and would clarify the timing for when
the open negotiation period begins. These proposed rules would also
amend the process for initiating the Federal IDR process. Specifically,
at 26 CFR 54.9816-8(b)(2), 29 CFR 2590.716-8(b)(2), and 45 CFR
149.510(b)(2), these proposed rules would amend the content of the
notice of IDR initiation and establish new requirements for a notice of
IDR initiation response from the non-initiating party. At 26 CFR
54.9816-8T(b)(3), 29 CFR 2590.716-8(b)(3), and 45 CFR 149.510(b)(3)
these proposed rules would also establish a new manner for providing
notices to the other party and the Departments.
These proposed rules would also provide additional clarity
regarding timeframes within the Federal IDR process. The No Surprises
Act includes timeframes by which certain steps of the Federal IDR
process must be completed. For example, the parties to a dispute must
jointly select a certified IDR entity not later than the last day of
the 3-business-day period following the date of the initiation of the
Federal IDR process, and if the parties fail to jointly select a
certified IDR entity, the Departments must select a certified IDR
entity not later than 6 business days after the date of IDR
initiation.\76\ While the No Surprises Act also provides detailed
timeframes for certain other steps in the process, the steps that must
be conducted before a payment determination can be issued are not as
clearly defined, such as when a certified IDR entity must conduct a
conflict-of-interest review and must determine whether an item or
service is a qualified IDR item or service, as defined in 26 CFR
54.9816-8T(a)(2)(xi), 29 CFR 2590.716-8(a)(2)(xi), and 45 CFR
149.510(a)(2)(xi), and eligible for the Federal IDR process. Therefore,
the provisions in these proposed rules would adjust certain steps and
establish associated timeframes (see Table 1). This includes proposed
provisions related to establishing a process for the preliminary
selection of the certified IDR entity and the final selection of the
certified IDR entity as set out in 26 CFR 54.9816-8(c)(1), 29 CFR
2590.716-8(c)(1), and 45 CFR 149.510(c)(1), in order to account for the
time it takes certified IDR entities to confirm that they do not have a
conflict of interest with either party. To allow more time for
certified IDR entities to conduct eligibility reviews, these proposed
rules would include proposed amendments to the Federal IDR process
eligibility review proposed in 26 CFR 54.9816-8T(c)(2), 29 CFR
2590.716-8(c)(2), and 45 CFR 149.510(c)(2). As discussed in section
I.H. of this preamble, eligibility reviews have proven to be complex
and time consuming. In extenuating circumstances, such as when dispute
volume is high, it may be more appropriate for the Departments, rather
than certified IDR entities, to conduct eligibility reviews to
facilitate quicker dispute processing. Therefore, these proposed rules
would establish a departmental eligibility review process in proposed
paragraph 26 CFR 54.9816-8(c)(2)(ii), 29 CFR 2590.716-8(c)(2)(ii), and
45 CFR 149.510(c)(2)(ii). Further, to support eligibility
determinations, conflict-of-interest reviews, or payment
determinations, the Departments propose requirements for the submission
of additional information from the disputing parties at 26 CFR 54.9816-
8(c)(2)(iii), 29 CFR 2590.716-8(c)(2)(iii), and 45 CFR
149.510(c)(2)(iii). To clarify and establish a standard process for
disputes to be withdrawn from the Federal IDR process, the Departments
propose four conditions in which a dispute may be withdrawn at 26 CFR
54.9816-8(c)(3)(i), 29 CFR 2590.716-8(c)(3)(i), and 45 CFR
149.510(c)(3)(ii). To further adjust timeframes and processes
associated with the Federal IDR process, these proposed rules would
include proposed amendments related to submission of offers and payment
determination and notification at 26 CFR 54.9816-8(c)(5), 29 CFR
2590.716-8(c)(5), and 45 CFR 149.510(c)(5); the collection of the
certified IDR entity fee at 26 CFR 54.9816-8(d)(1), 29 CFR 2590.716-
8(d)(1), and 45 CFR 149.510(d)(1); and the collection of the
administrative fee, including a process for setting a reduced
administrative fee for low-dollar amount disputes and for non-
initiating parties in cases of ineligible disputes, at 26 CFR 54.9816-
8(d)(2), 29 CFR 2590.716-8(d)(2), and 45 CFR 149.510(d)(2). These
proposed rules also include provisions to expand upon situations in
which Federal IDR process timeframes may be waived due to extenuating
circumstances at 26 CFR 54.9816-8T(g), 29 CFR 2590.716-8(g), and 45 CFR
149.510(g).
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\76\ Section 9816(c)(4)(F) of the Code, section 716(c)(4)(F) of
ERISA, and section 2799A-1(c)(4)(F) of the PHS Act.
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Lastly, to address concerns regarding the vacated batching
provision at 26 CFR 54.9816-8T(c)(3)(i)(C), 29 CFR 2590.716-
8(c)(3)(i)(C), and 45 CFR 149.510(c)(3(i)(C) and to create more
efficiencies in the process, these proposed rules at 26 CFR 54.9816-
8(c)(4), 29 CFR 2590.716-8(c)(4), and 45 CFR 149.510(c)(4) would
include provisions that would allow for more flexibility in batching
multiple items or services in a single dispute.
It is the Departments' intention that the implementation of the
proposed provisions in these proposed rules, if finalized, would lead
to a more efficient
[[Page 75756]]
Federal IDR process and more timely payment determinations.
BILLING CODE 6325-63-P; 4830-01-P; 4510-29-P; 4120-01-P
[GRAPHIC] [TIFF OMITTED] TP03NO23.002
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[GRAPHIC] [TIFF OMITTED] TP03NO23.003
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[GRAPHIC] [TIFF OMITTED] TP03NO23.004
BILLING CODE 6325-63-C; 4830-01-C; 4510-29-C; 4120-01-C
II. Overview of the Proposed Rules--Departments of the Treasury, Labor,
and HHS
A. Definition of Bundled Payment Arrangement
Section 9816(c)(3)(B) of the Code, section 716(c)(3)(B) of ERISA,
and section 2799A-1(c)(3)(B) of the PHS Act state that the Departments
shall provide that, in the case of items and services which are
included by a provider or facility as part of a bundled payment, such
items and services included in such bundled payment may be part of a
single determination. The October 2021 interim final rules specify that
in the case of qualified IDR items and services billed by a provider,
facility, or provider of air ambulance services as part of a bundled
payment arrangement, or if a plan or issuer makes or denies an initial
payment as a bundled payment, the qualified IDR items and services may
be submitted as part of one payment determination and are subject to
the rules for batched determinations and the certified IDR entity fee
for single determinations.\78\ The preamble to the October 2021 interim
final rules describes a bundled payment arrangement as an instance in
which a group health plan or health insurance issuer pays a provider,
facility, or provider of air ambulance services a single payment for
multiple items or services furnished during an episode of care to a
single patient.\79\ To clarify how certified IDR entities can identify
a dispute that includes a bundled payment arrangement, the Departments
provided a definition for a bundled payment arrangement in the August
2022 Technical Assistance for Certified IDR Entities.\80\ In that
guidance, the Departments clarified that a single payment to one
provider, facility, or provider of air ambulance services for multiple
items or services must be made at the service code level for the entire
bundle in order to be considered a bundled payment and therefore be
treated as a single payment determination for the multiple items and
services under the Federal IDR process. The Departments defined a
bundled payment arrangement at the service code level because service
codes are the principal mechanism by which health care services and
supplies are identified and reimbursed. These rules propose to codify
the clarification set forth in the August 2022 Technical Assistance for
Certified IDR Entities. Specifically, the Departments propose to amend
26 CFR 54.9816-3T, 29 CFR 2590.716-3, and 45 CFR 149.30 by defining the
term ``bundled payment arrangement'' as an arrangement under which: (1)
a provider, facility, or provider of air ambulance services bills for
multiple items or services furnished to a single patient under a single
service code that represents multiple items or services (for example, a
DRG code); or
[[Page 75759]]
(2) a plan or issuer makes an initial payment or notice of denial of
payment to a provider, facility, or provider of air ambulance services
under a single service code that represents multiple items or services
furnished to a single patient (for example, a DRG code).
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\77\ For a chart outlining the Federal IDR Process under the
current regulations, see the Federal IDR Process Guidance for
Disputing Parties at https://www.cms.gov/files/document/federal-idr-guidance-disputing-parties-march-2023.pdf.
\78\ 86 FR 55994.
\79\ Id.
\80\ U.S. Department of Health and Human Services, U.S.
Department of Labor, and U.S. Department of the Treasury. (August
2022). Technical Assistance for Certified IDR Entities. https://www.cms.gov/files/document/TA-certified-independent-dispute-resolution-entities-August-2022.pdf.
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For example, the August 2022 Technical Assistance for Certified IDR
Entities, the National Correct Coding Initiative (NCCI) Policy Manual
\81\ explains that if a physician performs bilateral mammography, the
provider shall report (or for the purpose of the Federal IDR process,
the provider shall bill) Current Procedural Terminology (CPT) code
77066 (Diagnostic mammography . . . bilateral). The provider should not
submit CPT code 77065 (Diagnostic mammography . . . unilateral) with 2
UOS or CPT code 77065 LT (unilateral left breast mammography) plus CPT
code 77065 RT (unilateral right breast mammography). Under this
example, the provider performed multiple services, and therefore, if
the services are billed or reimbursed under one service code (CPT code
77066), all services performed under that service code (CPT codes 77065
LT and 77065 RT) may be considered a bundled payment arrangement for
purposes of the Federal IDR process.
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\81\ The NCCI, developed by the Centers for Medicare & Medicaid
Services, promotes correct national coding methodologies. Although
created for the purpose of reducing improper Medicare Part B
payments, the NCCI policy manual is also used by commercial payers.
CMS. (Feb. 28, 2023). Medicare National Correct Coding Initiative
(NCCI) Edits. https://www.cms.gov/medicare-medicaid-coordination/national-correct-coding-initiative-ncci/ncci-medicare/medicare-ncci-policy-manual.
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Further, under current rules at 26 CFR 54.9816-8T(c)(3)(ii), 29 CFR
2590.716-8(c)(3)(ii), and 45 CFR 149.510(c)(3)(ii), bundled payment
arrangements can be submitted as a single dispute and are subject to
certified IDR entity fees for a single dispute rather than the higher
fees for batched disputes (which may include multiple items or services
from different claims between the same provider and plan but reflect
the same service code or a similar code under a different procedural
coding system).
To further clarify the process for resolving IDR disputes for
bundled payment arrangements, the Departments propose an amendment that
would remove the language in the October 2021 interim final rules
stating that a bundled payment arrangement is subject to the rules for
batched determinations. While a bundled payment arrangement by
definition is billed by the same provider or group of providers,
facility, or same provider of air ambulance services and paid by the
same group health plan or health insurance issuer, not all requirements
for batched determinations \82\ apply to bundled payment arrangements.
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\82\ 26 CFR 54.9816-8T(c)(3), 29 CFR 2590.716-8(c)(3), and 45
CFR 149.510(c)(3).
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The Departments solicit comment on the definition and treatment of
bundled payment arrangements. The Departments also solicit comment on
examples of service or procedural codes other than DRGs that would meet
the proposed definition of a bundled payment arrangement.
B. Use of CARCs and RARCs
1. Existing Payment Communication Practice and Requirements
As described in section I.E. of this preamble, plans and issuers
are currently required to disclose certain information to providers,
facilities, and providers of air ambulance services when making an
initial payment or notice of denial of payment when the recognized
amount is the QPA.\83\ The Health Insurance Portability and
Accountability Act of 1996 (HIPAA) mandated the adoption of electronic
standards for certain health care transactions, including health care
payment and remittance advice. Under HIPAA and regulations implementing
the electronic transaction standards, these disclosures, when
transmitted from a plan or issuer to a provider, facility, or provider
of air ambulance services,\84\ meet the definition of a health care
remittance advice transaction.\85\ Therefore, plans and issuers must
comply with the Accredited Standards Committee (ASC) X12 implementation
guide adopted at 45 CFR 162.1602 when electronically transmitting the
QPA disclosures required under 26 CFR 54.9816-6T(d), 29 CFR 2590.716-
6(d), and 45 CFR 149.140(d) to a provider, facility, or provider of air
ambulance services.\86\ Further, plans and issuers are required to send
remittance information electronically upon the request of a provider,
facility, or provider of air ambulance services, regardless of whether
the requesting individual or entity is in the plan's or issuer's
network or otherwise affiliated with the plan or issuer.\87\ When
remittance advice is transmitted electronically, it is commonly
referred to as an ERA.
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\83\ 26 CFR 54.9816-6T(d), 29 CFR 2590.716-6(d), and 45 CFR
149.140(d). As explained in section II.C. of this preamble, the
Departments are proposing the following amendments to 26 CFR
54.9816-6T(d), 29 CFR 2590.716-6(d), and 45 CFR 149.140(d) to
reflect that the concept of the recognized amount is not applicable
to providers of air ambulance services: (1) requiring plans and
issuers to disclose the QPA and certain information about the QPA
when cost sharing is calculated using the QPA for an air ambulance
service; and (2) requiring plans and issuers to provide these
disclosures when the recognized amount (or with respect to air
ambulance services, the amount on which cost sharing is based) is
the QPA or the amount billed by the provider, facility, or provider
of air ambulance services.
\84\ HIPAA requirements related to health care remittance advice
transactions apply to ``covered entities,'' including ``health
plans'' (which generally include plans and issuers) and ``health
care providers'' (which include providers, facilities, and providers
of air ambulance services that transmit any health information in
electronic form in connection with an electronic transaction for
which a standard has been adopted under HIPAA). 45 CFR 160.102 and
45 CFR 160.103. For purposes of continuity with the rest of this
preamble, this section uses the terms ``plan'' and ``issuer'' to
refer to entities that are subject to HIPAA requirements that apply
to ``health plans'' and the term ``providers, facilities, and
providers of air ambulance services'' to refer to entities that are
subject to HIPAA requirements that apply to ``health care
providers.'' However, self-administered group health plans with
fewer than 50 participants are excluded from the term ``health
plan'' under 45 CFR 160.103 and are not subject to HIPAA
requirements.
\85\ 45 CFR 162.1601 (``The health care electronic funds
transfers (EFT) and remittance advice transaction is the
transmission of either of the following for health care: (a) The
transmission of any of the following from a health plan to a health
care provider: (1) Payment. (2) Information about the transfer of
funds. (3) Payment processing information. (b) The transmission of
either of the following from a health plan to a health care
provider: (1) Explanation of benefits. (2) Remittance advice.'').
\86\ The ASC X12N 835 Version 5010 (835 transaction) is the
current HIPAA standard that plans and issuers must use to
electronically transmit explanation of benefits or remittance advice
information to providers and facilities. As discussed later in this
section II.B. of this preamble, the current ASC X12 standards
predate, and therefore do not address, the No Surprises Act
requirements.
\87\ 45 CFR 162.925(a)(1). See also Gerhardt, C. (March 22,
2022). Guidance on health plans' payment of health care claims using
Virtual Credit Cards (VCCs) and adopted HIPAA standards for Health
Care Electronic Funds Transfers (EFT) and Electronic Remittance
Advice (ERA) transactions. Centers for Medicare & Medicaid Services.
https://www.cms.gov/files/document/guidance-letter-vcc-eft-era.pdf.
HIPAA regulations require that a covered entity conduct a
transaction as a standard transaction when using electronic media to
transmit a transaction for which the Secretary has adopted a
standard (see 45 CFR 162.923(a)). HIPAA regulations also require a
health plan to conduct transactions as standard transactions when
requested to do so (see 45 CFR 162.925(a)(1)). HIPAA does not,
however, obligate a health plan to conduct a transaction(s) that it
would not otherwise conduct.
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An ERA explains how a plan or issuer has adjusted claim charges
based on factors like contract agreements, secondary payers, benefits
coverage, and expected cost sharing.\88\ As noted earlier in this
preamble section with reference to QPA disclosures, all ERAs must
[[Page 75760]]
comply with the ASC X12 835 transaction standard adopted by HHS under
45 CFR 162.1602. The X12 835 implementation guide mandates the use of
CARCs and RARCs to communicate remittance information (as opposed to
any other code systems, such as proprietary codes developed by
individual plans and issuers).\89\ The terms ``CARC'' and ``RARC'' are
not defined in Federal statute but are described in the ASC X12 835
implementation guide and the Council for Affordable Quality Healthcare
Committee on Operating Rule for Information Exchange (CAQH CORE)
operating rule adopted at 45 CFR 162.1603(a)(4). CARCs explain why a
claim or service line was paid differently than it was billed.\90\
RARCs provide additional explanations for an adjustment already
described by a CARC or convey information about remittance processing.
RARCs are either ``supplemental,'' meaning that they provide additional
explanation for an adjustment already described by a CARC, or
``informational,'' meaning they convey information about remittance
processing and are never related to a specific adjustment or CARC.\91\
The lists of approved CARCs and RARCs are maintained by separate
committees (the CARC Committee and the RARC Committee) designated by
HHS to review requests to add, remove, or modify existing CARCs and
RARCs. The HIPAA operating rule adopted at 45 CFR 162.1603(a)(4)
requires plans and issuers to use a uniform set of CARCs and RARCs for
defined business scenarios. Updated lists of approved CARCs and RARCs,
along with an updated list of approved code combinations and business
scenarios, are published three times each year.\92\
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\88\ Centers for Medicare & Medicaid Services. (June 16, 2022).
Health Care Payment and Remittance Advice and Electronic Funds
Transfer. https://www.cms.gov/Regulations-and-Guidance/Administrative-Simplification/Transactions/HealthCarePaymentandRemittanceAdviceandElectronicFundsTransfer.
\89\ CARCs and RARCs are required by the ASC X12 835 transaction
standard and are not currently required to be used on paper
remittance advice.
\90\ X12. (Nov. 16, 2022). Claim Adjustment Reason Codes.
https://x12.org/codes/claim-adjustment-reason-codes.
\91\ X12. (March 1, 2023). Remittance Advice Remark Codes.
https://x12.org/codes/remittance-advice-remark-codes.
\92\ CAQH CORE. (n.d). Ongoing Maintenance of the CORE Code
Combinations. https://www.caqh.org/core/ongoing-maintenance-core-code-combinations.
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The RARC Committee has approved a set of specific RARCs that convey
information related to the No Surprises Act, including which of the No
Surprises Act provisions apply to a claim, how cost sharing was
calculated under the No Surprises Act, and whether a payment for a
claim was an initial or final payment calculated in accordance with the
No Surprises Act.\93\ These RARCs are currently available for use by
plans and issuers, although the existing No Surprises Act-specific
RARCs do not address all required QPA disclosures. The current
standards and operating rules that govern ERA transactions under HIPAA
were adopted prior to the enactment of the No Surprises Act and do not
include specific requirements that dictate which combinations of CARCs
and RARCs must be used to communicate claim adjudication information in
business scenarios anticipated by the No Surprises Act.\94\
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\93\ X12. (March 1, 2023). Remittance Advice Remark Codes.
https://x12.org/codes/remittance-advice-remark-codes (complete list
of approved RARC codes including No Surprises Act-specific codes);
and Centers for Medicare & Medicaid Services. (March 1, 2022).
Remittance Advice Remark Codes Related to the No Surprises Act.
(unofficial reference list of No Surprises Act-specific RARC codes).
\94\ The ASC X12 835 transaction standard requires health plans
to convey information about the adjudication of a claim using CARCS
and RARCS. The Phase III 360 CORE Uniform Use of CARCs and RARCs
(835) Rule, adopted at 45 CFR 162.1603 requires plans to use
specified combinations of CARCs and RARCs in certain business
scenarios. CAQH CORE. (August 2022). CAQH CORE Payment and
Remittance (835) Uniform Use of CARCs and RARCs Rule, Version
PR.1.1. https://www.caqh.org/sites/default/files/core/Payment-Remittance-CARCs-RARCs-Rule.pdf.
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Plans and issuers consequently convey the disclosures required
under the No Surprises Act to providers, facilities, and providers of
air ambulances through a variety of methods, including electronic and
paper remittance advice. These disclosures, if more effectively
communicated, would provide providers, facilities, and providers of air
ambulance services with more accessible information to determine
whether they may initiate open negotiation and the Federal IDR process.
However, in part because plans and issuers are not able to transmit all
of the required disclosures through standard transactions,\95\ such as
the ASC X12 835 transaction, providers, facilities, and providers of
air ambulance services have reported to the Departments that they are
not always aware of, or cannot understand, the disclosures even when
the plan or issuer claims to have met the disclosure requirements.\96\
Moreover, the Departments' ability to assess how often CARCs and RARCs
are used to convey information related to the No Surprises Act is
limited due to the minimal available data on uptake and the absence of
guidance, standards, or operational rules specifying how these codes
must be used. Informal feedback from providers, facilities, and
providers of air ambulance services and plans and issuers suggests that
some plans and issuers are using some of these codes, including when
providing paper remittance advice, but there is not yet widespread
usage.
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\95\ ``Standard transaction'' means a transaction that complies
with an applicable standard and associated operating rules adopted
under the HIPAA Administrative Simplification requirements at 45 CFR
part 162. 45 CFR 162.103.
\96\ For example, the Departments are aware of some cases where
providers, facilities, and providers of air ambulance services used
third parties to process remittances and did not realize the process
for viewing the remittances through those third parties was
filtering out information related to the No Surprises Act.
Similarly, some providers, facilities, and providers of air
ambulance services may view electronic remittance advice without
realizing plans and issuers provided the QPA and related information
on paper remittance advice.
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2. Proposal To Require CARCs and RARCs To Improve Communication Between
Plans and Issuers and Providers, Facilities, and Providers of Air
Ambulance Services
Gaps in communication between plans and issuers and providers,
facilities, and providers of air ambulance services contribute to
inefficiencies in resolving disputes in the Federal IDR process. The
Departments have identified the following areas of confusion, reported
by plans, issuers, providers, facilities, providers of air ambulance
services, and certified IDR entities, which are also consistent with
the Departments' experience administering the Federal IDR process: (1)
whether the consumer protections against balance billing and out-of-
network cost sharing under the No Surprises Act apply to an item or
service; (2) how cost sharing and the out-of-network rates are
determined (that is, through an All-Payer Model Agreement, specified
State law, or the Federal rules); (3) how and with whom to initiate
open negotiations; and (4) which items or services eligible for the
Federal IDR process can be batched or bundled into one dispute.
To address communication challenges described in section II.B.1. of
this preamble, the Departments propose new disclosure rules at 26 CFR
54.9816-6A, 29 CFR 2590.716-6A, and 45 CFR 149.100. These proposed
provisions would require plans and issuers to use CARCs and RARCs, as
specified in guidance issued by the Departments (and discussed
elsewhere in this section II.B. of this preamble), or as required under
any applicable adopted standards and operating rules under 45 CFR part
162, to communicate information related to whether a claim for an item
or service furnished by an entity that does not have a direct or
indirect
[[Page 75761]]
contractual relationship with the plan or issuer with respect to the
furnishing of such item or service under the plan or coverage is
subject to the provisions of 26 CFR 54.9816 and 54.9817; 29 CFR
2590.716 and 2590.717; or 45 CFR part 149, subparts B, E, or F. To
improve the functioning of the Federal IDR process and ensure timely
rendering of payment determinations, the Departments are of the view
that providers, facilities, and providers of air ambulance services
need information to understand not only when items and services are
subject to the No Surprises Act, but also when they are not, to avoid
submission of ineligible disputes to the Federal IDR process.
The Departments have the authority under section 9816(a)(2)(B)(ii)
of the Code, section 716(a)(2)(B) of ERISA, and section 2799A-
1(a)(2)(B)(ii) of the PHS Act to establish through rulemaking the
information that a plan or issuer must share with a provider or
facility when making a determination of the QPA, including the form and
manner of such disclosures.\97\ The Departments also have authority
under section 9833 of the Code, section 734 of ERISA, and section 2792
of the PHS Act to issue such regulations as may be necessary and
appropriate to carry out the provisions of chapter 100 of the Code,
part 7 of ERISA, and title XXVII of the PHS Act, including the
provisions directing the Departments to establish the Federal IDR
process.
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\97\ The No Surprises Act does not include the same language
addressing disclosures to providers of air ambulance services.
However, the July 2021 interim final rules implemented the statute's
cost-sharing requirements for air ambulance services by requiring
that plans and issuers base any coinsurance and deductible for air
ambulance services furnished by a nonparticipating provider of air
ambulance services on the lesser of the QPA or the billed amount for
the services. 86 FR 36884. Therefore, the July 2021 interim final
rules also applied the requirement to make disclosures regarding the
QPA with respect to providers of air ambulance services. As stated
in the preamble to the July 2021 interim final rules, the
Departments recognize that providers of air ambulance services
subject to the surprise billing rules (as well as providers and
emergency facilities) need transparency regarding how the QPA was
calculated in order to inform the open negotiation process and the
decision whether to initiate the Federal IDR process and what offer
to submit. 86 FR 36898.
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Under these authorities, the Departments propose to require plans
and issuers to use CARCs and RARCs to convey specific information about
the No Surprises Act when a plan or issuer provides a paper or
electronic remittance advice to any entity with which it does not have
a direct or indirect contractual relationship with respect to the
furnishing of an item or service under the plan or coverage.
Specifically, under these proposed rules, a plan or issuer would be
required to use CARCs and RARCs in accordance with guidance issued by
the Departments when, with respect to an entity with which it does not
have a direct or indirect contractual relationship, the plan or issuer
provides a paper or electronic remittance advice to a provider,
facility, or provider of air ambulance services for an initial payment,
notice of denial of payment, or total plan or coverage payment required
under the No Surprises Act.
These proposed requirements would also apply to plans and issuers
when sending remittance advice to entities with which they do not have
a direct or indirect contractual relationship with respect to items and
services to which the No Surprises Act surprise billing requirements do
not apply, in order to convey that the No Surprises Act does not apply.
Requiring plans and issuers to use approved CARCs and RARCs to
convey information related to the No Surprises Act on both electronic
and paper remittance advice would better facilitate the flow of
information between plans and issuers and providers, facilities, and
providers of air ambulance services and increase efficiencies in the
processing of claims subject to the No Surprises Act's surprise billing
protections. This requirement would also assist providers, facilities,
and providers of air ambulance services in identifying items and
services that are not eligible for the Federal IDR process as early as
the initial payment or notice of denial of payment, thereby reducing
the submission of ineligible payment disputes to the Federal IDR
process. This would decrease the need for outreach by certified IDR
entities and allow them to concentrate resources on making payment
determinations for eligible disputes.
In addition, the Departments anticipate that the proposed
requirement to use CARCs and RARCs would provide valuable information
to certified IDR entities in determining whether disputing parties
agree on the eligibility of a dispute for the Federal IDR process after
it has been submitted. As described in section II.D.1. of this
preamble, the Departments propose to require that the open negotiation
notice include a copy of the initial payment or notice of denial of
payment, which would, under the proposal described in this section of
this preamble, include CARCs and RARCs related to the No Surprises Act.
The Departments also propose, as described in section II.D.1. of this
preamble, to require the open negotiation notice be submitted to the
Departments through the Federal IDR portal. This would help ensure
that, even if a plan or issuer does not respond to a notice of IDR
initiation, the certified IDR entity has access to certain information
regarding whether the plan or issuer believes the dispute could be
eligible for the Federal IDR process, thereby avoiding unnecessary or
duplicative outreach to the parties when possible.
As discussed in section V.D. of this preamble, requiring the use of
CARCs and RARCs as described in these proposed rules would result in an
increase in burden for plans (or their third party administrators
(TPAs)) and issuers, as they would need to implement and automate the
use of new CARCs and RARCs. However, because all plans and issuers that
provide ERA transactions subject to the HIPAA Administrative
Simplification requirements already are required to use CARCs and
RARCs, the Departments anticipate that most plans and issuers would
generally have the capacity to provide No Surprises Act-specific CARCs
and RARCs. The Departments seek comment on any circumstances in which
it would not be possible for a plan or issuer to determine whether an
item or service included on a remittance advice is, or is not, subject
to the Federal IDR process at the time the remittance advice is issued
to a provider, facility, or provider of air ambulance services. The
Departments also seek comment on the technical and operational steps
that would be necessary to initially implement new No Surprises Act-
specific CARCs and RARCs, including for plans and issuers that do not
currently use CARCs and RARCs, or that are currently able to
accommodate only one CARC and RARC combination per line item.
The Departments propose that certain procedural aspects of this
proposal would be implemented through guidance issued by the
Departments.\98\ Should the proposal described in this section of the
preamble be finalized, the Departments would be authorized to require
plans and issuers to use CARCs and RARCs to communicate information
related to whether a claim for an out-of-network item or service is or
is not subject to the surprise billing provisions of the No Surprises
Act. The guidance issued under this authority would identify specific
CARCs and RARCs and describe the specific circumstances in
[[Page 75762]]
which the identified CARCs and RARCs must be used. As discussed in
section II.B.1. of this preamble, this approach also mirrors the
existing framework under HIPAA, in which required CARC and RARC code
combinations are issued through guidance, as authorized by regulation.
This would provide the Departments with the flexibility to specify the
use of CARCs and RARCs, including new No Surprises Act-specific RARCs
that may be developed in the future, while the Departments work to
address communication challenges affecting the surprise billing
provisions of the No Surprises Act. It would also provide flexibility
for the Departments to discontinue the use of certain CARCs and RARCs
should the information communicated using those CARCs and RARCs become
readily available to providers, facilities, or providers of air
ambulance services through a different mechanism or otherwise become
unnecessary. As discussed in more detail in section II.H.1. of this
preamble, the Departments propose that plans and issuers would have a
period of time following the issuance of guidance to implement the use
of CARCs and RARCs in accordance with the guidance.
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\98\ This proposal would not alter HHS' authority under HIPAA to
implement future guidance with respect to electronic remittance
advice or to adopt new or modified standards or operating rules in
accordance with Title XI Part C--Administrative Simplification of
the Social Security Act.
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HHS is not proposing changes to the HIPAA transaction standards
(such as the X12 835 standard) or operating rules in these proposed
rules. HHS continues to monitor the implementation of the No Surprises
Act in order to determine whether future changes to the HIPAA
transaction standards and operating rules, in accordance with the
mandated HIPAA standards and operating rules development and adoption
processes,\99\ might provide a long-term mechanism for facilitating
communication related to the No Surprises Act between plans and issuers
and providers, facilities, and providers of air ambulance services.
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\99\ Sections 1172 and 1173 of the Social Security Act and 45
CFR 162.910.
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The Departments are of the view that it would be beneficial to
standardize No Surprises Act-related communications between plans and
issuers and providers, facilities, and providers of air ambulance
services, regardless of whether the information is transmitted using
HIPAA standard transactions. Therefore, under this proposal, the
Departments would issue guidance regarding the use of CARCs and RARCs
in both electronic transactions as well as formats outside the purview
of the HIPAA transaction standards, including paper remittance advice.
While CARCs and RARCs have not been widely used to transmit information
outside of ERA transactions, the Departments understand that some plans
and issuers routinely communicate with providers, facilities, and
providers of air ambulance services using paper remittance advice and
other formats outside the purview of the HIPAA transaction standards.
In addition to the RARCs related to the No Surprises Act described
previously in this section of the preamble that have been approved for
use, the Departments are assessing whether additional CARCs or RARCs
could be helpful for improving communication between parties about how
out-of-network claims are being processed in relation to the No
Surprises Act. For example, the Departments are considering whether it
would be beneficial to require the use of CARCs and RARCs when plans
and issuers have insufficient information to determine coverage for a
claim from a nonparticipating provider of air ambulance services.\100\
The Departments are also considering whether it would be beneficial to
require the use of RARCs that could be used to provide any of the
information required to be disclosed about the QPA under 26 CFR
54.9816-6T(d), 26 CFR 54.9816-6(d), 29 CFR 2590.716-6(d), and 45 CFR
149.140(d). It also may be helpful to have a RARC that specifies that
the No Surprises Act surprise billing protections do not apply. In
addition, a large proportion of the disputes determined ineligible for
the Federal IDR process by certified IDR entities involve items or
services that providers, facilities, or providers of air ambulance
services batched improperly because they did not realize that a TPA was
administering coverage for multiple self-insured plans rather than a
single issuer or group health plan, and the items and services were
thus ineligible to be batched.\101\ Certified IDR entities have
determined that other disputes are ineligible for the Federal IDR
process because the self-insured plan involved in the dispute had
voluntarily opted in to a specified State law.\102\ A RARC that could
clearly identify a payer as a self-insured plan may reduce the number
of disputes that are initiated and determined ineligible on the basis
of a batching or jurisdictional error. The Departments solicit comment
on whether and what information not conveyed in the existing RARCs
would be helpful to convey through the creation of additional RARCs
related to the No Surprises Act's surprise billing provisions.
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\100\ In TMA III, the District Court vacated the language in 26
CFR 54.9817-1T(b)(4)(i), 29 CFR 2590.717-1(b)(4)(i), and 45 CFR
149.130(b)(4)(i), that stated with respect to air ambulance
services, ``For purposes of this paragraph (b)(4)(i), the 30-
calendar-day period begins on the date the plan or issuer receives
the information necessary to decide a claim for payment for the
services.'' See Memorandum Opinion and Order, Tex. Med. Ass'n., et
al. v. U.S. Dep't of Health and Hum. Servs., No. 6:22-cv-00450-JDK
(E.D. Tex. August 24, 2023). Because a plan or issuer may not have
the information necessary to decide a claim for payment within the
30-calendar-day period, the Departments are considering whether
CARCs and RARCs may be useful in such circumstances.
\101\ 26 CFR 54.9816-8T(c)(3)(i)(B), 29 CFR 2590.716-
8(c)(3)(i)(B), and 45 CFR 149.510(c)(3)(i)(B).
\102\ See discussion in section I.H. of of this preamble related
to the provisions of the July 2021 interim final rules that allow
self-insured group health plans, including self-insured non-Federal
governmental plans, to voluntarily opt into a specified State law.
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The Departments are aware that some States require issuers to use
CARCs and RARCs to communicate information about State surprise billing
laws. The Departments seek comment regarding experience with these
requirements, including whether such requirements have been effective,
and any challenges related to implementing such requirements. Should
these proposed rules be finalized, the Departments note that nothing in
these proposed rules would prevent a State from requiring that issuers
use specific CARCs or RARCs in addition to those specified in the No
Surprises Act-specific Federal guidance that the Departments would be
authorized to issue; nor would a State or other entity be prevented
from engaging with the relevant committees to request the creation or
use of a CARC or RARC in addition to those specified in such guidance.
Prior to the enactment of the No Surprises Act, out-of-network
providers, facilities, and providers of air ambulance services commonly
sought reimbursement directly from patients rather than from a plan or
issuer, requiring a participant, beneficiary, or enrollee to then seek
reimbursement for all or part of the cost of the out-of-network service
directly from their plan or issuer. Because the No Surprises Act
prohibits nonparticipating providers, facilities, and providers of air
ambulance services from billing or holding liable a participant,
beneficiary, or enrollee for an amount greater than the applicable in-
network cost-sharing requirement for items and services subject to the
No Surprises Act, direct billing of patients is now largely limited to
items and services to which surprise billing protections in the No
Surprises Act do not apply. The Departments understand that requiring
the plan or issuer to convey CARC or RARC information related to
eligibility for such processes to a participant,
[[Page 75763]]
beneficiary, or enrollee in this circumstance would represent an
administrative burden on the plan or issuer without any clear benefit
to the participant, beneficiary, or enrollee. In addition, such a
requirement would not further the aims of these proposed rules to
facilitate timely rendering of payment determinations and to improve
the functioning of the Federal IDR process, in which a participant,
beneficiary, or enrollee cannot participate as a party. Therefore, the
requirement to use CARCs and RARCs under these proposed rules would not
apply for out-of-network items and services for which the plan or
issuer makes payment directly to the participant, beneficiary, or
enrollee. The Departments seek comment on whether a plan or issuer
should generate a remittance advice that can be obtained upon request
by the provider, facility, or provider of air ambulance services when
the plan or issuer makes a payment directly to a participant,
beneficiary, or enrollee, and whether the requirement to use CARCs and
RARCs to convey No Surprises Act-specific information as proposed in
these rules should apply in these circumstances.
While the proposal refers to any paper or electronic remittance
advice,\103\ the Departments seek comment on whether a more general
term, such as ``any remittance advice,'' would be helpful in
characterizing the types of communications accompanying payments for
items and services. The Departments also seek comment on this proposal
generally.
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\103\ The Departments are aware that different terms are
sometimes used, such as paper remittance advice or explanation of
payment, when referring to the paper communication that accompanies
a payment or notice of denial of payment to a provider or facility
for a claim and provides additional information about the
adjudication of the claim for which payment is being made.
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C. Information To Be Shared About the QPA
As described in sections I.B. and I.E. of this preamble, the July
2021 interim final rules and August 2022 final rules provide that if
the recognized amount with respect to an item or service is the QPA,
plans and issuers must make certain disclosures about the QPA with each
initial payment or notice of denial of payment and must also provide
certain additional information upon request.\104\ This information must
be provided in writing, either on paper or electronically, to a
provider, facility, or provider of air ambulance services, as
applicable.\105\
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\104\ 86 FR 36898; 87 FR 52633.
\105\ 26 CFR 54.9816-6T(d) and 54.9816-6(d), 29 CFR 2590.716-
6(d), and 45 CFR 149.140(d).
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While these requirements were intended to ensure the disclosure of
information about the QPA in any instance in which an item or service
would be eligible for the Federal IDR process, the text of the current
regulation directs plans and issuers to make these disclosures only if
the recognized amount with respect to an item or service furnished by a
provider, facility, or provider of air ambulance services is the QPA.
The Departments propose a change to reflect that the term ``recognized
amount'' is not used in the statute or regulations for purposes of
determining cost sharing with respect to air ambulance services
furnished by nonparticipating providers of air ambulance services.
Rather, under the July 2021 interim final rules, plans and issuers must
calculate the cost-sharing amount for air ambulance services furnished
by a nonparticipating provider of air ambulance services as if the
total amount that would have been charged were equal to the lesser of
the QPA or the billed amount for the services.\106\ Therefore, the
Departments propose to amend the regulations to specify that plans and
issuers must, in the case of air ambulance services, disclose the QPA
and certain information about the QPA when cost sharing is calculated
using the QPA. In addition, the Departments propose to require plans
and issuers to make the same disclosures when the recognized amount (or
with respect to air ambulance services, the amount on which cost
sharing is based) is the amount billed by the provider, facility, or
provider of air ambulance services, and not only when the recognized
amount (or with respect to air ambulance services, the amount on which
cost sharing is based) is the QPA, as these items and services would
also be eligible for the Federal IDR process (provided all other
eligibility criteria are satisfied).
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\106\ 86 FR 36884.
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Under 26 CFR 54.9816-6T(d)(1)(iv), 29 CFR 2590.716-6(d)(1)(iv), and
45 CFR 149.140(d)(1)(iv), a plan or issuer making disclosures about the
QPA must include a statement that if the provider or facility wishes to
initiate a 30-day open negotiation period for purposes of determining
the amount of total payment, the provider or facility may contact the
appropriate person or office to initiate open negotiation, and if the
30-day open negotiation period does not result in a determination,
generally the provider or facility may initiate the Federal IDR process
4 days after the end of the open negotiation period. Under 26 CFR
54.9816-6T(d)(2), 29 CFR 2590.716-6(d)(2), and 45 CFR 149.140(d)(2),
plans and issuers are required to disclose additional information in a
timely manner upon the request of the provider or facility.
The Departments propose technical and conforming amendments to
align these requirements with the October 2021 interim final rules
\107\ and current practice. First, the Departments acknowledge that 26
CFR 54.9816-6T(d), 29 CFR 2590.716-6(d), and 45 CFR 149.140(d) do not
consistently include references to providers of air ambulances services
when referring to providers and facilities, and propose amendments to
clarify that these disclosure requirements apply with respect to
providers of air ambulance services (in addition to providers and
facilities). Specifically, in 26 CFR 54.9816-6T, 29 CFR 2590.716-6, and
45 CFR 149.140, the Departments propose to amend the introductory
language in paragraph (d), paragraph (d)(1)(iv), and the introductory
language of paragraph (d)(2) to clarify the applicability with respect
to disclosures to providers of air ambulance services.\108\ Second, the
Departments propose to align the timeframes described in the disclosure
with the timeframes established in the October 2021 interim final
rules,\109\ by specifying that days are counted using business days
(rather than calendar days), where applicable. The Departments also
propose an amendment to align the language in 26 CFR 54.9816-
6T(d)(1)(iv), 29 CFR 2590.716-6(d)(1)(iv), and 45 CFR 149.140(d)(1)(iv)
with the same requirements established in the October 2021 interim
final rules by replacing the phrase ``amount of total payment'' with
the term ``out-of-network rate,'' as defined in 26 CFR 54.9816-3T, 29
CFR 2590.716-3, and 45 CFR 149.30, and by describing an unsuccessful
open negotiation period as not resulting in an ``agreement on the
amount of payment'' rather than a ``determination.''
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\107\ 86 FR 55980.
\108\ The Departments anticipate finalizing additional
corrections to address this issue when finalizing the remainder of
the July 2021 interim final rules.
\109\ 26 CFR 54.9816-8T(b)(1)(i), 29 CFR 2590.716-8(b)(1)(i),
and 45 CFR 149.510(b)(1)(i).
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The Departments further propose to require that the statement also
explain that the provider, facility, or provider of air ambulance
services must notify the Departments as described under proposed 26 CFR
54.9816-8(b)(1)(i), 29 CFR 2590.716-8(b)(1)(i), and 45 CFR
149.510(b)(1)(i), as applicable, to initiate
[[Page 75764]]
open negotiation.\110\ The Departments propose that plans and issuers
include this explanation as part of the disclosure once the open
negotiation notice can be submitted through the Federal IDR portal.
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\110\ For a discussion of the proposed requirement to notify the
Departments when initiating open negotiation, see section II.D.1.c.
of this preamble.
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As stated in the preamble to the July 2021 interim final rules
\111\ and the August 2022 final rules,\112\ the Departments seek to
ensure transparent and meaningful disclosure of information relating to
the calculation of the QPA for providers, facilities, and providers of
air ambulance services, while at the same time minimizing
administrative burdens on plans and issuers and on the Federal IDR
process. The Departments are now of the view that additional disclosure
of information with the QPA is critical to ensuring that all parties
have the information necessary to determine whether a payment dispute
is eligible for the Federal IDR process. The Departments therefore
propose to amend 26 CFR 54.9816-6T, 29 CFR 2590.716-6, and 45 CFR
149.140 by re-designating paragraph (d)(1)(v) as (d)(1)(vi) and adding
a new paragraph (d)(1)(v) that would require plans and issuers to
disclose the legal business name of the plan (if any) or issuer; the
legal business name of the plan sponsor (if applicable); and the
registration number assigned under proposed 26 CFR 54.9816-9, 29 CFR
2590.716-9, or 45 CFR 149.530, as applicable, if the plan or issuer is
registered with the Federal IDR registry.\113\ The Departments seek
comment on the specific technical and operational steps that would be
necessary for plans and issuers to disclose this additional information
when providing an initial payment or notice of denial of payment.
Further, the Departments are seeking comment on the appropriate
implementation period that would allow plans and issuers to complete
these steps to comply with these proposed rules, if finalized. As noted
in section II.B. of this preamble, the Departments are also seeking
comment on whether any of the additional proposed disclosures should be
required to be communicated using a CARC or RARC specified in guidance
issued by the Departments.
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\111\ 86 FR 36898.
\112\ 87 FR 52625.
\113\ For a discussion of the proposal to establish a Federal
IDR registry and assign a registration number to each plan and
issuer, see section II.F. of this preamble.
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D. Open Negotiation and Initiation of the Federal IDR Process
Section 9816(c)(1)(A) of the Code, section 716(c)(1)(A) of ERISA,
section 2799A-1(c)(1)(A) of the PHS Act, and the October 2021 interim
final rules establish that, when the out-of-network rate is not
determined by reference to an All-Payer Model Agreement under section
1115A of the Social Security Act or specified State law as defined in
26 CFR 54.9816-3T, 29 CFR 2590.716-3, and 45 CFR 149.30, the plan or
issuer or provider or facility may engage in open negotiations to
determine the total out-of-network rate (inclusive of any cost
sharing).\114\ If the parties fail to reach an agreement through open
negotiation, they may initiate the Federal IDR process. Section 9817(b)
of the Code, section 717(b) of ERISA, and section 2799A-2(b) of the PHS
Act provide that out-of-network rates for air ambulance services may be
determined through open negotiation or an IDR process that is largely
identical to the process provided for in section 9816(c) of the Code,
section 716(c) of ERISA, and section 2799A-1(c) of the PHS Act. Thus,
the preamble and regulatory text describing open negotiations and the
Federal IDR process generally apply to providers of air ambulance
services, unless otherwise specified.
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\114\ 86 FR 55990.
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1. Open Negotiation
The Departments propose to amend the open negotiation provisions of
26 CFR 54.9816-8T(b)(1)(i) and (ii), 29 CFR 2590.716-8(b)(1)(i) and
(ii), and 45 CFR 149.510(b)(1)(i) and (ii) to establish additional
requirements for initiating open negotiation and to revise the open
negotiation period start date. In addition, the Departments propose to
add a new paragraph at 26 CFR 54.9816-8(b)(1)(iii), 29 CFR 2590.716-
8(b)(1)(iii), and 45 CFR 149.510(b)(1)(iii) that would establish a
requirement that in response to a party's written notice of its intent
to negotiate (open negotiation notice), the party in receipt of the
notice must provide a written open negotiation response notice. In
these proposed rules, the Departments propose amendments to the content
requirements for the open negotiation notice. The Departments also
propose to require an open negotiation response notice from non-
initiating parties, including specific content requirements.
Section 9816(c)(1)(A) of the Code, section 716(c)(1)(A) of ERISA,
section 2799A-1(c)(1)(A) of the PHS Act, and the October 2021 interim
final rules establish that the open negotiation period may be initiated
by either party during the 30-business-day period beginning on the day
the provider, facility, or provider of air ambulance services receives
either an initial payment or a notice of denial of payment for an item
or service.\115\ The October 2021 interim final rules provide that in
order for a plan, issuer, provider, facility, or provider of air
ambulance services to know when it is a party to an open negotiation
period and the item or service for which the payment is the subject of
open negotiation, the party initiating open negotiation must provide to
the other party a written open negotiation notice.\116\ Under 26 CFR
54.9816-8T(b)(1)(ii)(A), 29 CFR 2590.716-8(b)(1)(ii)(A), and 45 CFR
149.510(b)(1)(ii)(A), an open negotiation notice must include
information sufficient to identify the item(s) and service(s)
(including the date(s) the item(s) or service(s) were furnished, the
service code, and the initial amount, if applicable, an offer of an
out-of-network rate, and contact information for the party sending the
open negotiation notice). The day on which the open negotiation notice
is first sent by the party is the date that the 30-business-day open
negotiation period begins. Consistent with the October 2021 interim
final rules, negotiation during the open negotiation period occurs
without the involvement of the Departments or a certified IDR
entity.\117\ Furthermore, the requirement to complete a 30-business-day
open negotiation period before initiating the Federal IDR process does
not preclude the parties from reaching an agreement in fewer than 30
business days. However, in the event the parties do not reach an
agreement, they still must exhaust the 30-business-day open negotiation
period before either party may initiate the Federal IDR process. The
Departments encourage disputing parties to negotiate in good faith
during this time period to reach an agreement on the out-of-network
rate. The Departments expect parties to make a genuine effort to
exchange information with one another at reasonable times and intervals
with the goal of reaching a solution satisfactory to both parties. To
the extent parties reach an agreement during the open negotiation
period, they can avoid the administrative fee and
[[Page 75765]]
other costs associated with the Federal IDR process.
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\115\ As clarified in the July 2021 interim final rules, the
initial payment should be an amount that the plan or issuer
reasonably intends to be payment in full based on the relevant facts
and circumstances, prior to the beginning of any open negotiations
or initiation of the Federal IDR process. (86 FR 36900 through
36901).
\116\ 86 FR 55990.
\117\ See 86 FR 55991.
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The preamble to the October 2021 interim final rules explained
that, given that the parties already would have made initial contact
(namely, the provider, facility, or provider of air ambulance services
transmitted a bill to the plan or issuer, and the plan or issuer sent
an initial payment or notice of denial of payment to the provider,
facility, or provider of air ambulance services), the Departments
expected the parties to provide effective notice and encouraged the
parties to take reasonable measures to confirm the other party's
contact information and confirm electronic receipt through approaches
such as read receipts, especially if a party does not initially respond
to an open negotiation notice.\118\ Further, the Departments
contemplated that issues related to eligibility and jurisdiction would
be resolved through the disclosures that plans and issuers are required
to provide with their initial payment or notice of denial of payment
or, through the required 30-business-day open negotiation period.
However, disputing parties and certified IDR entities have reported
that disputing parties are sometimes not actively negotiating with each
other during the required period as expected by the Departments. In
addition, non-initiating parties and certified IDR entities continue to
express concern that initiating parties sometimes do not properly
initiate or complete the open negotiation period before initiating the
Federal IDR process. Plans and issuers also have expressed concern with
the Departments and the certified IDR entities, that providers,
facilities, and providers of air ambulance services overwhelm them with
requests to negotiate items or services that are ineligible for the
Federal IDR process. At the same time, providers, facilities, and
providers of air ambulance services assert that plans and issuers
rarely respond to their notices initiating open negotiation or provide
inadequate information to determine whether the Federal IDR process
applies during the open negotiation period.
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\118\ 86 FR 55990.
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a. Determination of Payment Amount Through Open Negotiation
To improve communication and information exchange between disputing
parties and promote efficiencies in the Federal IDR process, the
Departments propose to amend the open negotiation provisions of 26 CFR
54.9816-8(b), 29 CFR 2590.716-8(b), and 45 CFR 149.510(b)(1) to impose
new information exchange requirements and processes and to establish a
process for tracking open negotiations through the Federal IDR portal
in anticipation of initiation of a Federal IDR dispute.
First, the Departments propose to amend paragraph 26 CFR 9816-
8(b)(1)(i), 29 CFR 2590.716-8(b)(1)(i), and 45 CFR 149.510(b)(1)(i) to
establish a requirement that a party must provide a written open
negotiation notice to the other party and to the Departments through
the Federal IDR portal to initiate the open negotiation period.\119\
Requiring a party to submit the open negotiation notice to the
Departments in addition to the other party would provide a record of
whether and when the open negotiation period was properly initiated,
which is essential in determining eligibility for the Federal IDR
process, and would create greater transparency among parties engaged in
open negotiation, the Departments, and certified IDR entities.
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\119\ 26 CFR 9816-8T(b)(3), 29 CFR 2590.716-8(b)(3), and 45 CFR
149.510(b)(3).
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Second, the Departments propose to amend 26 CFR 54.9816-8(b)(1)(i),
29 CFR 2590.716-8(b)(1)(i), and 45 CFR 149.510(b)(1)(i) to specify that
the 30-business-day open negotiation period begins on the day a party
first submits the open negotiation notice and a copy of the initial
payment, notice of denial of payment, or other remittance advice, as
specified at proposed 26 CFR 54.9816-8(b)(1)(ii)(A)(12), 29 CFR
2590.716-8(b)(1)(ii)(A)(12), and 45 CFR 149.510(b)(1)(ii)(A)(12), to
the other party and the Departments through the Federal IDR portal.
This amendment would not change the timeframe for engaging in open
negotiations but would provide greater clarity for parties engaged in
open negotiation and improve the shared understanding of deadlines
related to the open negotiation period. The Departments seek comment on
these proposed amendments.
b. Open Negotiation Response Notice
To have a meaningful open negotiation, the Departments are of the
view that both parties must be active and responsive participants. The
Departments' experience and feedback from disputing parties and
certified IDR entities indicate that the Federal IDR process is less
efficient overall when disputing parties are not engaging with each
other during the open negotiation period. Therefore, the Departments
propose at 26 CFR 54.9816-8(b)(1)(iii), 29 CFR 2590.716-8(b)(1)(iii),
and 45 CFR 149.510(b)(1)(iii) to require that the party in receipt of
the open negotiation notice provide a written notice and supporting
documentation in response to the open negotiation notice (open
negotiation response notice) to the other party and the Departments
through the Federal IDR portal as soon as practicable, but no later
than the 15th business day of the 30-business-day open negotiation
period. Requiring the party in receipt of the open negotiation notice
to submit an open negotiation response notice to both the other party
and the Departments through the Federal IDR portal would help ensure
that parties are responding to open negotiation notices and engaging
with one another during the open negotiation period. To better inform
the parties' negotiations, the Departments are proposing this 15-
business-day timeframe to give the party in receipt of the open
negotiation notice sufficient time to review and respond to the open
negotiation notice. This would also allow the party that submitted the
open negotiation notice to consider, at its discretion, the information
included in the open negotiation response notice during (at a minimum)
the remaining 15 business days in the 30-business-day open negotiation
period.
These deadlines are intended to encourage meaningful participation
in open negotiations and allow both parties time to consider offers and
raise eligibility concerns prior to initiating the Federal IDR process.
If a party were to fail to furnish an open negotiation response notice
containing all required information to the other party and the
Departments, the Departments would review and determine whether
enforcement actions may be appropriate. However, failure to timely
furnish an open negotiation response notice in any specific open
negotiation would not extend the open negotiation period, delay the
timeframe for initiation of the Federal IDR process, or affect either
party's ability to initiate the Federal IDR process.
The Departments solicit comment on the proposed modifications to
the requirements for submitting the open negotiation notice and the
newly proposed open negotiation response notice. Specifically, the
Departments seek comment on whether the party in receipt of the open
negotiation notice should be required to furnish the open negotiation
response notice to the other party and the Departments earlier than
proposed to allow additional time for the party submitting the open
negotiation notice to review the open negotiation response notice. The
Departments also seek comment on imposing a deadline for the open
[[Page 75766]]
negotiation response notice later than the proposed deadline, including
by the 20th business day or up to the last day of the 30-business-day
open negotiation period. A longer response timeframe may be necessary
for a party in receipt of open negotiation notice to review and respond
if the party receives a high number of open negotiation notices within
a short time period. However, submission of the open negotiation
response notice at the end of the open negotiation period would not
provide the party that submitted the open negotiation notice sufficient
time to review, consider, and engage with the party submitting the open
negotiation response notice in a meaningful manner prior to the
deadline for initiation of the Federal IDR process. Additionally, the
Departments seek comment on allowing the certified IDR entities, as a
means of incentivizing participation in the proposed exchange of
notices, to take into consideration a party's compliance with the 15-
business-day deadline for the open negotiation response notice when
making their payment determinations.
c. Open Negotiation Notice Content
The Departments propose to amend 26 CFR 54.9816-8(b)(1)(ii)(A), 29
CFR 2590.716-8(b)(1)(ii)(A), and 45 CFR 149.510(b)(1)(ii)(A) and add 26
CFR 54.9816-8(b)(1)(ii)(A)(1) through (12), 29 CFR 2590.716-
8(b)(1)(ii)(A)(1) through (12), and 45 CFR 149.510(b)(1)(ii)(A)(1)
through (12) to require that the open negotiation notice include
additional information regarding the item or service under dispute and
the party sending the open negotiation notice. The proposed amendments
would add new elements and expand the information required on the open
negotiation notice.
Under these proposed rules, the content elements to identify the
item or service on the open negotiation notice would align with those
that the Departments propose to require in the notice of IDR initiation
to identify an item or service under dispute as specified in 26 CFR
54.9816-8(b)(2)(iii)(A), 29 CFR 2590.716-8(b)(2)(iii)(A), and 45 CFR
149.510(b)(2)(iii)(A) and would encourage consistency between open
negotiation and the Federal IDR process. The Departments are of the
view that requiring the additional elements as part of the open
negotiation notice would help parties identify the item or service, the
reasons for the denial of payment or initial payment amount, and
whether the Federal IDR process applies. Each proposed new or amended
element on the open negotiation notice is described in this section,
and the Departments' reasoning for the proposed change is explained.
Under current rules, the open negotiation notice must include
contact information for the party sending the notice. At proposed
paragraphs 26 CFR 54.9816-8(b)(2)(iii)(A)(1) through (3), 29 CFR
2590.716-8(b)(2)(iii)(A)(1) through (3), and 45 CFR
149.510(b)(1)(ii)(A)(1) through (3), the Departments would require
specific contact information sufficient to identify the provider,
facility, or provider of air ambulance services, the plan or issuer,
and any third party representing the parties in the open negotiation.
This contact information would include legal business name, email
address, phone number, and mailing address, as provided with the claim
form submitted by the provider, facility, or air ambulance provider to
the plan or issuer, which would encourage open negotiation initiation
between the correct parties and effective communication of the required
information.
In addition to the proposed standard contact information elements,
parties would also be required to include the National Provider
Identification (NPI) number to identify the provider, facility, or
provider of air ambulance services and the IDR registration number,
assigned under proposed 26 CFR 54.9816-9, 29 CFR 2590.716-9, and 45 CFR
149.530, to identify the plan or issuer (described further in section
II.F. of this preamble).
Providers, facilities, and providers of air ambulance services
would obtain the IDR registration number from the plan or issuer when
the plan or issuer provides it with the initial payment or notice of
denial of payment. The proposed registration number would help the
provider, facility, or provider of air ambulance services to accurately
identify the plan and issuer with which to initiate open negotiation,
and the contact and plan information necessary to initiate open
negotiation, particularly if the plan or issuer fails to clearly
disclose such information. Including this element on the open
negotiation notice would streamline the process of submitting the open
negotiation notice by providing a validated source of plan and issuer
business and contact information, which providers, facilities, and
providers of air ambulance services often struggle to identify on
documentation provided with the initial payment or the notice of denial
of payment and would promote greater consistency and accuracy in
initiating open negotiation with the correct plan or issuer.
The Departments acknowledge, as described in section II.F. of this
preamble, that the plan or issuer may not be registered in the IDR
registry at the time the provider, facility, or provider of air
ambulance services initiates the open negotiation period. In these
circumstances, the party submitting the open negotiation notice would
attest that the party receiving the open negotiation notice was not
registered prior to the date the party submitted its open negotiation
notice and the registration number would not be required to be included
in the notice. The submitting party would use the contact information
currently required by the disclosure requirements established in
sections 26 CFR 54.9816-6T(d)(1), 29 CFR 2590.716-6(d)(1), and 45 CFR
149.140(d)(1) with the initial payment or notice of denial of payment
to complete the open negotiation notice. Finally, if the party
submitting the open negotiation notice is a plan or issuer, the plan or
issuer would be required to include the plan type. It is the
Departments' view that the plan or issuer is best positioned to provide
this information and that this information is necessary in assessing
applicability of the Federal IDR process. If the plan or issuer is not
the party initiating open negotiation, the plan or issuer would be
required to include this information on the open negotiation response
notice form, as discussed in section II.D.1.d. of this preamble.
Under the current regulations, the open negotiation notice must
include information sufficient to identify the item(s) and service(s)
furnished by the provider, facility, or provider of air ambulance
services. These include the date(s) the item(s) or service(s) were
furnished, the service code, and initial payment amount, if applicable,
an offer of an out-of-network rate, and contact information for the
party sending the open negotiation notice. If finalized, these proposed
rules would add to this list of elements considered information
sufficient to identify the item or service and, therefore, required to
be included in the open negotiation notice at proposed paragraphs 26
CFR 54.9816-8(b)(1)(ii)(A)(4), 29 CFR 2590.716-8(b)(1)(ii)(A)(4), and
45 CFR 149.510(b)(1)(ii)(A)(4). The proposed additions include
information to identify the location where the item or service was
furnished (such as place of service code or bill type code \120\), type
of item or service, the State where the item or service was furnished,
and the
[[Page 75767]]
claim number. The place of service code is a two-digit code on health
care professional claims that indicates the setting in which a service
was furnished.\121\ Place of service code information is often needed
to determine the acceptability of direct billing of Medicare, Medicaid,
and private insurance services furnished by a given provider.\122\
Further, these proposed rules would require the open negotiation notice
to include the type of item or service, including whether the item or
service is an emergency service or a non-emergency service; whether the
item or service is an air ambulance service as defined in 26 CFR
54.9816-3T, 29 CFR 2590.716-3, and 45 CFR 149.30; and whether any
service is a professional service or a facility-based service. Parties
engaged in open negotiations may use place of service code and
information on the type of item or service to analyze the
appropriateness of the payment for the item or service and the
applicability of the Federal IDR process. The place of service code and
type of item or service along with the proposed requirement to include
the State where the item or service was furnished would help the
parties assess whether a specified State law or an All-Payer Model
Agreement might apply. In some States, a specified State law or All-
Payer Model Agreement may apply only to certain items or services or
with respect to services furnished by certain out-of-network providers
or at certain locations (``bifurcated States'').\123\
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\120\ Bill type code is the code relevant for billing by
facilities (as opposed to place of service code for providers).
\121\ See Centers for Medicare & Medicaid Services. (December 1,
2021). Place of Service Codes. https://www.cms.gov/Medicare/Coding/
place-of-service-
codes#:~:text=Place%20of%20Service%20Codes%20are,throughout%20the%20h
ealth%20care%20industry.
\122\ Id.
\123\ There are currently 21 bifurcated States: California,
Colorado, Connecticut, Delaware, Florida, Georgia, Illinois, Maine,
Maryland, Michigan, Missouri, Nebraska, Nevada, New Hampshire, New
Jersey, New Mexico, New York, Ohio, Texas, Virginia, and Washington.
See https://www.cms.gov/files/document/applicability-federal-idr-bifurcated-states.pdf.
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The combination of these requirements would help parties identify
whether the Federal IDR process applies or whether an applicable
specified State law or All-Payer Model Agreement governs the out-of-
network payment amount. The Departments are of the view that requiring
parties to provide this information on the open negotiation notice
would improve communication between parties and help identify and
resolve differences in their understanding of the items or services
that are the subject of open negotiation. Further, the Departments
expect that as the Federal IDR portal continues to evolve, this
information may also be helpful in providing automatic verifications
upon a party's initiation of the open negotiation period of eligibility
for the Federal IDR process, which may result in a reduction in
submission of ineligible items and services.\124\
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\124\ The Departments note that while this information may
assist parties in preliminarily assessing eligibility based on the
location of service, it would not eliminate the need for the
certified IDR entity or the Departments to determine whether a
specified State law applies to the specific item or service and
provider at issue.
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Plans and issuers have expressed concern that it is often difficult
to identify the item or service subject to the dispute within their
billing systems without the associated claim number provided by the
provider, facility, or provider of air ambulance services. Therefore,
the Departments amended the standard open negotiation notice to include
the claim number, as it is necessary to identify the item or service
that is subject of the dispute.\125\ Under these proposed rules, the
Departments are proposing to codify the requirement to include the
associated claim number in the open negotiation notice.
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\125\ U.S. Department of Health and Human Services, U.S.
Department of Labor, and U.S. Department of Treasury. (expiration
Nov. 30, 2025). Open Negotiation Notice. (OMB Control No. 1210-
0169). https://www.dol.gov/sites/dolgov/files/ebsa/laws-and-regulations/laws/no-surprises-act/surprise-billing-part-ii-information-collection-documents-attachment-2.pdf.
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At proposed paragraph 26 CFR 54.9816-8(b)(1)(ii)(A)(5), 29 CFR
2590.716-8(b)(1)(ii)(A)(5), and 45 CFR 149.510(b)(1)(ii)(A)(5), the
Departments would specify that the open negotiation notice must include
the initial payment amount (including $0 if, for example, the payment
is denied) of the item or service subject to the open negotiation. The
initial payment amount is an existing requirement of the open
negotiation notice, and this proposed amendment relocates it to 26 CFR
54.9816-8(b)(1)(ii)(A)(5), 29 CFR 2590.716-8(b)(1)(ii)(A)(5), and 45
CFR 149.510(b)(1)(ii)(A)(5) in the regulatory text and clarifies that
the plan or issuer must specify $0 if payment is denied.
The Departments propose to add paragraph 26 CFR 54.9816-
8(b)(1)(ii)(A)(6), 29 CFR 2590.716-8(b)(1)(ii)(A)(6), and 45 CFR
149.510(b)(1)(ii)(A)(6) to require a party initiating open negotiations
to provide the QPA for the item or service that is the subject of the
negotiation if it has been provided on the initial payment or notice of
denial of payment or if the party submitting the open negotiation
notice is a plan or issuer. Similarly, by requiring the QPA to be
disclosed on the open negotiation notice, the Departments intend to
facilitate better communication between parties in identifying whether
there may be a mistake in the identified QPA, such as a typographical
error or the incorrect use of the cost sharing amount rather than the
QPA, so the information can be rectified before initiating the Federal
IDR process, if applicable.
At proposed paragraph 26 CFR 54.9816-8(b)(1)(ii)(A)(7), 29 CFR
2590.716-8(b)(1)(ii)(A)(7), and 45 CFR 149.510(b)(1)(ii)(A)(7) the
Departments would specify that the open negotiation notice must include
an offer of an out-of-network rate for each item or service that is the
subject of the open negotiation. The offer of an out-of-network-rate is
an existing requirement of the open negotiation notice, and this
proposed amendment relocates it to new paragraph (b)(1)(ii)(A)(7) in
the regulatory text.
Under proposed 26 CFR 54.9816-8(b)(1)(ii)(A)(8), 29 CFR 2590.716-
8(b)(1)(ii)(A)(8), and 45 CFR 149.510(b)(1)(ii)(A)(8) the Departments
propose to require that if the party submitting the open negotiation
notice is a plan or issuer, it must include the amount of cost sharing
imposed for the item or service, if any. The Departments are of the
view that the plan or issuer is in the best position to provide this
information since non-participating providers, facilities, or providers
of air ambulance services generally would not have access to this
information. Because the amount of cost sharing for a qualified IDR
item or service would be determined by the QPA amount, requiring the
amount of cost sharing paid or owed by the participant, beneficiary, or
enrollee could help parties better inform their offers while
negotiating. The amount of cost sharing paid or owed by the
participant, beneficiary, or enrollee would be used, along with the
prevailing offer to calculate the final payment amount, should a party
choose to initiate the Federal IDR process for the item or service in
question. Having a shared understanding of this value and its impact on
payment during open negotiations would support the parties' ability to
negotiate with one another in good faith.
A non-emergency item or service is ineligible for the Federal IDR
process if the patient was properly provided notice and consented to
waive their protections from balance billing under
[[Page 75768]]
the No Surprises Act.\126\ To reduce the number of Federal IDR process
disputes initiated for items or services that are ineligible for this
reason, the Departments propose to require at new 26 CFR 54.9816-
8(b)(1)(ii)(A)(9), 29 CFR 2590.716-8(b)(1)(ii)(A)(9), and 45 CFR
149.510(b)(1)(ii)(A)(9) that if the party submitting the open
negotiation notice is a provider or facility, that party must provide a
statement that the items and services do not qualify for the notice and
consent exception described at 45 CFR 149.410(b) or 149.420(c) through
(i), either because the items and services are subject to the
prohibition on balance billing without exception or because the
provider or facility did not provide notice and receive consent.
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\126\ The notice and consent exception does not apply to
ancillary services, which include items and services related to
emergency medicine, anesthesiology, pathology, radiology, and
neonatology, whether furnished by a physician or non-physician
practitioner; items and services furnished by assistant surgeons,
hospitalists, and intensivists; diagnostic services, including
radiology and laboratory services; and items and services furnished
by a nonparticipating provider, if there is no participating
provider who can furnish such item or service at such facility.
Additionally, as specified in PHS Act section 2799B-2(c), the notice
and consent exception does not apply to items or services furnished
as a result of unforeseen, urgent medical needs that arise at the
time an item or service is furnished for which a nonparticipating
provider satisfied the notice and consent criteria.
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To further reduce the number of Federal IDR disputes initiated for
ineligible items or services, the Departments propose at 26 CFR
54.9816-8(b)(1)(ii)(A)(10), 29 CFR 2590.716-8(b)(1)(ii)(A)(10), and 45
CFR 149.510(b)(1)(ii)(A)(10) to require that the party submitting the
open negotiation notice provide a statement that the provider,
facility, or provider of air ambulance services was a nonparticipating
provider, facility, or provider of air ambulance services on the date
the item or service was furnished. Identification of this eligibility
factor at open negotiation may decrease the number of ineligible
disputes initiated by drawing the attention of the parties to the
statutory eligibility standards underlying the Federal IDR process.
Currently, the standard form \127\ for the open negotiation notice
provided by the Departments contains general information including a
description of the open negotiation period, what happens at the end of
the open negotiation period, and the Federal IDR process. The
Departments propose at 26 CFR 54.9816-8(b)(1)(ii)(A)(11), 29 CFR
2590.716-8(b)(1)(ii)(A)(11), and 45 CFR 149.510(b)(1)(ii)(A)(11) to
align the general information requirements for the open negotiation
notice with existing requirements under the October 2021 interim final
rules regarding the notice of IDR initiation, which specify that the
notice of IDR initiation must include a statement describing the
Federal IDR process and general information to help ensure that the
non-initiating party is informed about the process and is familiar with
the next steps.\128\
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\127\ See U.S. Department of Health and Human Services, U.S.
Department of Labor, and U.S. Department of the Treasury.
(expiration Nov. 30, 2025). Open Negotiation Notice. (OMB Control
No. 1210-0169). https://www.dol.gov/sites/dolgov/files/ebsa/laws-and-regulations/laws/no-surprises-act/surprise-billing-part-ii-information-collection-documents-attachment-2.pdf.
\128\ 86 FR 55991.
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To support the identification of items or services ineligible for
the Federal IDR process, the Departments propose to require the party
submitting the open negotiation notice to provide a copy of the initial
payment or notice of denial of payment or other remittance advice that
is required to include the proposed CARC and RARC disclosures described
in section II.B. of this preamble at proposed 26 CFR 54.9816-
8(b)(1)(ii)(A)(12), 29 CFR 2590.716-8(b)(1)(ii)(A)(12), and 45 CFR
149.510(b)(1)(ii)(A)(12). The remittance advice containing the proposed
CARC and RARC disclosures would provide information as to whether the
plan or issuer believes the claim is eligible for the Federal IDR
process and ensure that a provider initiating open negotiation
understands the position of the plan or issuer regarding the
eligibility of an item or service, even in situations in which a plan
or issuer in receipt of an open negotiation notice is not otherwise
responsive.
The Departments seek comment on the addition of these proposed
required elements to the open negotiation notice. The Departments also
solicit comment on whether the party submitting the open negotiation
notice should be required to provide a statement describing why the
party is initiating the open negotiation period, including any
considerations that serve as the basis for the initiation of open
negotiation for the item or service, such as any of the considerations
currently described in 26 CFR 54.9816-8T(c)(4)(iii) and 54.9817-
2T(b)(2), 29 CFR 2590.716-8(c)(4)(iii) and 2590.717-2(b)(2), and 45 CFR
149.510(c)(4)(iii) and 149.520(b)(2).
d. Open Negotiation Response Notice Content
The Departments propose to establish requirements for an open
negotiation response notice at 26 CFR 54.9816-8(b)(1)(iii)(A), 29 CFR
2590.716-8(b)(1)(iii)(A), and 45 CFR 149.510(b)(1)(iii)(A).
Specifically, the Departments propose to require that the party
receiving an open negotiation notice must provide a response to the
open negotiation notice, which would include the same information
specified in proposed 26 CFR 54.9816-8(b)(1)(ii)(A)(1) through (3), 29
CFR 2590.716-8(b)(1)(ii)(A)(1) through (3), and 45 CFR
149.510(b)(1)(ii)(A)(1) through (3) related to the requirements to
provide contact information sufficient to identify the provider,
facility, or provider of air ambulance services, the plan or issuer
that are parties to the open negotiation, and any third party
representing a party in the open negotiation. The Departments further
propose that the open negotiation response notice would include the
following additional information under proposed 26 CFR 54.9816-
8(b)(1)(iii)(A)(4) through (11), 29 CFR 2590.716-8(b)(1)(iii)(A)(4)
through (11), and 45 CFR 149.510(b)(1)(iii)(A)(4) through (11): (4)
information sufficient to identify the item or service included in the
open negotiation notice, including the date(s) the item or service was
furnished, the claim number, and if the party in receipt of the open
negotiation notice is a provider, facility, or provider of air
ambulance services, the date(s) that the provider, facility, or
provider of air ambulance services received the initial payment or
notice of denial of payment for such item or service from the plan or
issuer; (5) if the party in receipt of the open negotiation notice is a
plan or issuer, a statement as to whether it agrees that the initial
payment amount (including $0 if, for example, payment is denied) and
the QPA reflected in the open negotiation notice accurately reflects
the initial payment amount and QPA disclosed with the initial payment
for the item or service, and if not, the initial payment amount
(including $0 if, for example, payment is denied) and/or the QPA it
believes to be correct and documentation to support the statement (for
example, the remittance advice confirming the QPA amount); (6) if the
party in receipt of the open negotiation notice is a plan or issuer,
the amount of cost sharing imposed for the item or service, if any; (7)
a counteroffer of an out-of-network rate for each item or service or an
acceptance of the other party's offer; (8) if the party in receipt of
the open negotiation notice is a provider or facility, a statement that
the items and services do not qualify for the notice and consent
exception described at 45 CFR 149.410(b) or 149.420(c) through (i); (9)
with respect to each item
[[Page 75769]]
or service, a statement and supporting documentation that explains why
the item or service is ineligible for the Federal IDR process or a
statement agreeing that the item or service is eligible for the Federal
IDR process; (10) a statement as to whether any of the information
provided in the open negotiation notice is inaccurate and the basis for
the statement, as well as supporting documentation; and (11) a
statement confirming that the initial payment or notice of denial of
payment or other remittance advice provided by the party submitting the
open negotiation notice is accurate, and if inaccurate, a copy of the
accurate initial payment or notice of denial of payment or other
remittance advice that is required to include the disclosures under 26
CFR 54.9816-6T(d)(1), 26 CFR 54.9816-6(d)(1), 29 CFR 2590.716-6(d)(1),
and 45 CFR 149.140(d)(1), with respect to the item or service.
Based on feedback from the certified IDR entities, non-initiating
parties often do not object to the applicability of the Federal IDR
process or to the accuracy of the QPA until after the certified IDR
entity has been selected, including at the time of offer submission.
Also, at times, disputing parties disagree about the accuracy of
information relevant to the claim under dispute. In these cases, the
initiating party is unaware of the non-initiating party's statement
because this information is sent to the certified IDR entity and not to
the initiating party well after the open negotiation period has ended.
This significantly slows down the processing of disputes, as the
certified IDR entity then must contact both parties to determine the
appropriate QPA or solicit information necessary to confirm the Federal
IDR process applies. To implement an efficient Federal IDR process,
both parties must be active participants in the process. For this
reason, and to minimize communication challenges between parties, the
Departments are of the view that the party in receipt of the open
negotiation notice should provide the proposed content elements to the
party sending the open negotiation notice and to the Departments. All
of the proposed open negotiation response notice content requirements
are also included in the proposed open negotiation notice content
requirements, except for: (1) a statement that explains why the item or
service is not subject to the Federal IDR process or a statement
agreeing that the item or service is subject to the Federal IDR
process; (2) a statement as to whether the QPA reflected in the open
negotiation notice is accurate for the item or service, and if not, a
statement providing the QPA it believes to be correct and documentation
to support the statement (for example, the remittance advice confirming
the QPA amount); and (3) a statement confirming the accuracy of the
initial payment, notice of denial of payment, or other remittance
advice provided by the party submitting the open negotiation notice,
and a copy of an accurate initial payment, notice of denial of payment
or other remittance advice if inaccurate. By restating information on
both the open negotiation notice and open negotiation response notice,
parties would have an opportunity to confirm or update information
necessary to negotiate and identify any information discrepancies which
could impact eligibility and decisions to negotiate or participate in
the Federal IDR process. With respect to the three proposed open
negotiation response notice content requirements not included in the
open negotiation notice, this proposal, if finalized, would make the
party submitting the open negotiation notice aware of any objection
that the party in receipt of the open negotiation notice has to the
dispute's eligibility for the Federal IDR process or its objection to
the QPA or remittance advice accuracy. Additionally, this proposal
would require the party in receipt of the open negotiation notice to
provide an explanation and documentation to support its statement(s).
The Departments are of the view that this proposed method of
exchanging information would facilitate communication and understanding
between the parties as to the eligibility of an item or service for the
Federal IDR process. The Departments seek comment on the content
elements of the open negotiation response notice. The Departments also
seek comment on the requirement to submit a counteroffer for an out-of-
network rate for the item or service or a statement accepting the other
party's offer on the open negotiation response notice. Specifically,
the Departments seek comment on whether it would hinder meaningful
negotiation between the parties outside the Federal IDR portal, or
whether it would promote negotiation among parties that might otherwise
not negotiate.
e. Technical Amendments
The Departments propose several technical amendments to the open
negotiation regulatory text. These proposed changes correct or remove
regulatory text that is being updated by the open negotiation proposals
in these proposed rules. First, the Departments propose a technical
correction for the cross reference at 26 CFR 54.9816-8T(b)(1)(i), 29
CFR 2590.716-8(b)(1)(i), and 45 CFR 149.510(b)(1)(i) which directs
readers to the definition of a qualified IDR item or service at
paragraph (a)(2)(xii)(A), but should instead reference paragraph
(a)(2)(xi)(A) for the appropriate cross reference to the definition of
a qualified IDR item or service.
Second, the Departments propose to remove the current regulatory
text that describes the manner in which the open negotiation notice
must be provided. The requirements for submitting the open negotiation
notice described in paragraphs 26 CFR 54.9816-8T(b)(1)(ii)(B), 29 CFR
2590.716-8(b)(1)(ii)(B), and 45 CFR 149.510(b)(1)(ii)(B) would be
removed because they would no longer apply under the proposed changes
to the open negotiation notice, and the removal of this paragraph
aligns with the proposal described at section II.D.3. of this preamble,
which would establish uniform standards for submitting notices for both
open negotiations and the IDR initiation through the Federal IDR
portal.
f. Implementation of Open Negotiation Through the Federal IDR Portal
As discussed in section II.D.3. of this preamble, to implement the
proposed modifications to the requirements for submitting the open
negotiation notice and the newly proposed open negotiation response
notice, the Departments would need to modify the Federal IDR portal to
allow parties to send the open negotiation notice and open negotiation
response notice to the other party and the Departments through the
Federal IDR portal. While some plans or issuers have created their own
proprietary portals to facilitate open negotiations, providers,
facilities, and providers of air ambulance services are not required to
use them. Accordingly, providers and facilities are not considered to
have failed to provide an open negotiation notice or open negotiation
response notice solely because they did not use a plan's or issuer's
proprietary portal. The Departments are of the view that having one
central location where plans, issuers, providers, facilities, and
providers of air ambulance services could initiate open negotiations
would increase efficiency. Plans, issuers, providers, facilities,
providers of air ambulance services, and certified IDR entities have
also requested that the Departments amend the rules to require parties
to send the open negotiation notice through the Federal IDR portal to
[[Page 75770]]
streamline the process and create a centralized platform where parties
can better track their open disputes. The Departments note that though
these rules propose to require the open negotiation notice and the open
negotiation response notice to be submitted through the Federal IDR
portal, parties would not be required to conduct negotiations within
the Federal IDR portal.
The Federal IDR portal would facilitate transmittal of the open
negotiation notice to the appropriate party. Specifically, if the party
receiving the open negotiation notice is a provider, facility, or
provider of air ambulance services, the Federal IDR portal would
transmit the notice to the party based on the contact information
provided in the open negotiation notice. However, if the party in
receipt of the open negotiation notice is a plan or issuer, the Federal
IDR portal would transmit the notice to the party based on the contact
information provided through the IDR registry. As discussed in sections
II.D.1.c. and II.F. of these proposed rules, it is possible that a plan
or issuer would not have submitted their information to the registry by
the time a party submits an open negotiation notice to them. If, at the
time the open negotiation notice is submitted there is not a
registration number for the plan or issuer, the Federal IDR portal
would transmit the notice to the party based on the contact information
provided in the open negotiation notice.
The Departments seek comment on whether the disputing parties
should be required to use the Federal IDR portal for further
communication related to open negotiations beyond the initiation of
open negotiation and the submission of the open negotiation response
notice. The Departments seek comment on what modes of correspondence
might be useful to the parties during the open negotiation period (for
example, the submission of additional documentation to the other party,
live chat, or message exchange, etc.) and if the content of those
communications should be accessible to the certified IDR entities if a
dispute is initiated on the relevant item or service. Lastly, the
Departments solicit comment on whether there are any additional
challenges preventing the parties from, or clarifications needed to
assist the parties in, fully engaging in meaningful negotiations during
the open negotiation period.
2. Changes to the Initiation of the Federal IDR Process
Section 9816(c)(1)(B) of the Code, section 716(c)(1)(B) of ERISA,
section 2799A-1(c)(1)(B) of the PHS Act, and the October 2021 interim
final rules establish that, with respect to items or services that are
the subject of an open negotiation period, if the parties have not
agreed upon an amount for the out-of-network rate by the last day of
the open negotiation period, either party may initiate the Federal IDR
process during the 4-business-day period beginning on the 31st business
day after the start of the open negotiation period.\129\
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\129\ 86 FR 55991.
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a. Notice of IDR Initiation
As discussed in section II.D.1. of this preamble, an efficient and
transparent Federal IDR process requires both parties to be active
participants. Therefore, the Departments propose to amend the IDR
initiation provisions of 26 CFR 54.9816-8(b)(2), 29 CFR 2590.716-
8(b)(2), and 45 CFR 149.510(b)(2) to improve communication between
parties, accelerate dispute processing, and reduce the burden on
certified IDR entities when determining whether a case is eligible for
the Federal IDR process. Specifically, these proposed rules would
require the initiating party to include additional information in the
notice of IDR initiation and would require non-initiating parties to
provide a response to the notice of IDR initiation (notice of IDR
initiation response) to the Departments and to the initiating party
through the Federal IDR portal within 3 business days of receipt of the
notice of IDR initiation. Section II.D.3. of this preamble describes
how the parties would provide both the notice of IDR initiation and
notice of IDR initiation response to the other party and the
Departments.
The Departments propose to amend the content of the notice of IDR
initiation and redesignate proposed 26 CFR 54.9816-8(b)(2)(iii)(A), 29
CFR 2590.716-8(b)(2)(iii)(A), and 45 CFR 149.510(b)(2)(iii)(A) as 26
CFR 54.9816-8(b)(2)(ii)(A), 29 CFR 2590.716-8(b)(2)(ii)(A), and 45 CFR
149.510(b)(2)(ii)(A). As described in section II.D.1.c. of this
preamble, under these proposed rules several of the content elements in
the notice of IDR initiation would be required in the open negotiation
notice and open negotiation response notice.\130\ As discussed in
section II.D.1.d. of this preamble, by restating information on the
notices, parties would have an opportunity to confirm or update
information necessary to continue negotiations and identify any
information discrepancies that could impact eligibility for the Federal
IDR process. Further, the open negotiation notice and notice of IDR
initiation would often not be identical since disputing parties do not
always decide to initiate the Federal IDR process for all items and
services included in the open negotiation notice. The Departments
anticipate that the Federal IDR portal would be able to prepopulate
information included in the open negotiation notices and open
negotiation response notices, which would mitigate additional burden on
the disputing parties and would provide the certified IDR entity (or
the Departments in the event the departmental eligibility review
applies as described in section II.E.1.b.ii. of these proposed rules)
sufficient information with respect to the item or service and dispute
in a single document.
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\130\ See proposed regulations for the open negotiation notice
content at: 26 CFR 54.9816-8(b)(1)(ii)(A)(1)-(6) and (9)-(12); 29
CFR 2590.716-8(b)(1)(ii)(A)(1)-(6) and (9)-(12); and 45 CFR
149.510(b)(1)(ii)(A)(1)-(6) and (9)-(12). See proposed regulations
for the open negotiation response content at: 26 CFR 54.9816-
8(b)(1)(iii)(A)(1)-(4), (8), and (11); 29 CFR 2590.716-
8(b)(1)(iii)(A)(1)-(4), (8), and (11); and 45 CFR
149.510(b)(1)(iii)(A)(1)-(4), (8) and (11).
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Under current rules, the notice of IDR initiation must include
contact information for the parties to the dispute. The proposed rules
under 26 CFR 54.9816-8(b)(2)(ii)(A)(1) through (3), 29 CFR 2590.716-
8(b)(2)(ii)(A)(1) through (3), and 45 CFR 149.510(b)(2)(ii)(A)(1)
through (3), would require specific contact information depending on
whether the initiating party is a provider, facility, or provider of
air ambulance services, or the plan or issuer, as well as any third
party representing the initiating party in the dispute. This contact
information would include the legal business name, email address, phone
number, mailing address, and Tax Identification Number (TIN). The
initiating party would also be required to include the NPI to identify
the provider, facility, or provider of air ambulance services and the
plan or issuer IDR registration number, assigned under proposed 26 CFR
54.9816-9, 29 CFR 2590.716-9, and 45 CFR 149.530 to identify the plan
or issuer, if the plan or issuer is registered, or an attestation from
the initiating party that the plan or issuer was not registered prior
to the date of the notice (described further in section II.F. of this
preamble). Further, if there is any third party representing the
initiating party, the notice of IDR initiation would be required to
include an attestation that the third party has the authority to act on
behalf of the
[[Page 75771]]
party it represents in the Federal IDR process.\131\
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\131\ Proposed 26 CFR 54.9816-8(b)(2)(ii)(A)(3), 29 CFR
2590.716-8(b)(2)(ii)(A)(3), and 45 CFR 149.510(b)(2)(ii)(A)(3).
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Under current rules, the notice of IDR initiation must also include
information sufficient to identify the items or services that are the
subject of the dispute. These proposed rules would amend these
requirements to include whether the dispute being initiated includes
batched or bundled qualified IDR items or services \132\ (described in
section II.E.2. of this preamble); the date(s) the qualified IDR item
or service was furnished; if the initiating party is a provider,
facility, or provider of air ambulance services, the date(s) that the
provider, facility, or provider of air ambulance services received the
initial payment or notice of denial of payment for such item or service
from the plan or issuer; the date the open negotiation period began;
the type of item or service; the State where the item or service was
furnished; the claim number; the service code; and information to
identify the location the item or service was furnished (including the
place of service code or bill type code).\133\ The proposed rule
requiring plans and issuers to provide the claim number in the notice
of IDR initiation would codify existing content requirements in the
notice of IDR initiation. The claim number is an element on the notice
of IDR initiation that is currently approved for use by the initiating
party, as it is information that is necessary to identify the item or
service under dispute, as currently required by 26 CFR 54.9816-
8T(b)(2)(iii)(A)(1), 29 CFR 2590.716-8(b)(2)(iii)(A)(1), and 45 CFR
149.510(b)(2)(iii)(A)(1). The Departments also propose requiring the
initiating party to submit its TIN in the notice of IDR initiation in
order to facilitate the Departments' ability to collect the
administrative fees directly, as described in section II.E.3.d. of this
preamble.\134\ The TIN would also facilitate debt collection from
parties that fail to pay their administrative fees and generally
streamline the collection process by serving as a unique identifier for
disputing parties.
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\132\ Proposed 26 CFR 54.9816-8(b)(2)(ii)(A)(4), 29 CFR
2590.716-8(b)(2)(ii)(A)(4), and 45 CFR 149.510(b)(2)(ii)(A)(4).
\133\ Proposed 26 CFR 54.9816-8(b)(2)(ii)(A)(5), 29 CFR
2590.716-8(b)(2)(ii)(A)(5), and 45 CFR 149.510(b)(2)(ii)(A)(5).
\134\ Currently, the administrative fee is paid to the selected
certified IDR entity and then remitted to the Departments. 26 CFR
54.9816-8T(d)(2)(i) and (e)(2)(ix), 29 CFR 2590.716-8(d)(2)(i) and
(e)(2)(ix), and 45 CFR 149.510(d)(2)(i) and (e)(2)(ix).
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Under current rules, the notice of IDR initiation requires the
initiating party to provide the initial payment amount, the QPA, and if
the initiating party is a provider or facility, a statement that the
items and services do not qualify for the notice and consent exception
described at 45 CFR 149.410(b) or 149.420(c) through (i). This
information would still be required under these proposed rules at
paragraphs 26 CFR 54.9816-8(b)(2)(ii)(A)(6) through (8), 29 CFR
2590.716-8(b)(2)(ii)(A)(6) through (8), and 45 CFR
149.510(b)(2)(ii)(A)(6) through (8), but would require the QPA only if
provided with the initial payment of notice of denial or payment or if
the initiating party is a plan or issuer. These proposed rules would
also require that the initiating party provide the initial payment
amount, including $0, if the payment was denied.
Further, these proposed rules would require a statement that the
provider, facility, or provider of air ambulance services was a
nonparticipating provider, nonparticipating emergency facility, or
nonparticipating provider of air ambulance services on the date the
item or service was furnished.\135\ As discussed in section II.D.1.c.
of this preamble, identification of this eligibility factor at the time
of initiating the Federal IDR process may decrease the number of
ineligible disputes initiated by drawing the attention of the parties
to the statutory eligibility standards underlying the Federal IDR
process.
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\135\ Proposed 26 CFR 54.9816-8(b)(2)(ii)(A)(9), 29 CFR
2590.716-8(b)(2)(ii)(A)(9), and 45 CFR 149.510(b)(2)(ii)(A)(9).
---------------------------------------------------------------------------
Under current rules, the notice of IDR initiation requires the
initiating party to provide an attestation that the item or service
under dispute is a qualified IDR item or service, and the basis for the
attestation; general information listed in the standard notice of IDR
initiation developed by the Departments describing the Federal IDR
process (including a description of the purpose of the Federal IDR
process and key deadlines in the Federal IDR process); and the
preferred certified IDR entity. Each of these content requirements
would still be required under these proposed rules.\136\
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\136\ Proposed 26 CFR 54.9816-8(b)(2)(ii)(A)(10) through (11)
and (13), 29 CFR 2590.716-8(b)(2)(ii)(A)(10) through (11) and (13),
and 45 CFR 149.510(b)(2)(ii)(A)(10) through (11) and (13).
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To improve communications between the parties to a dispute, these
proposed rules would also require the initiating party to include a
copy of the initial payment or notice of denial of payment or other
remittance advice that is required to include the disclosures under 26
CFR 54.9816-6T(d)(1), 26 CFR 54.9816-6(d)(1), 29 CFR 2590.716-6(d)(1),
and 45 CFR 149.140(d)(1), with respect to the item or service; \137\
and a statement describing the key aspects of the claim discussed by
the parties during open negotiation that relate to the payment for the
disputed claim, whether the reasons for initiating the Federal IDR
process are different from those aspects discussed during the open
negotiation period, and an explanation of why the party is initiating
the Federal IDR process, including any of the considerations currently
described in 26 CFR 54.9816-8(c)(4)(iii) and 54.9817-2(b)(2), 29 CFR
2590.716-8(c)(4)(iii) and 2590.717-2(b)(2), and 45 CFR
149.510(c)(4)(iii) and 149.520(b)(2) that serve as the party's basis
for initiating the Federal IDR process.\138\ The Departments have
received feedback that plans and issuers are often unaware of the
reasons why the provider, facility, or provider of air ambulance
services is initiating the Federal IDR process, despite engaging in the
30-business-day open negotiation period. Further, plans and issuers
have stated that providers, facilities, and providers of air ambulance
services often raise different reasons in the notice of offer
submission than the reasons they presented during the open negotiation
period. Plans and issuers have also stated that if they knew earlier of
a provider's, facility's, or provider of air ambulance services'
reasoning for initiating the Federal IDR process, they may have a more
accurate basis for making an alternative out-of-network payment amount
that may better align with the provider's, facility's, or provider of
air ambulance services' requested total payment amount. Thus, the
Departments are of the view that requiring this information would
result in the non-initiating party providing a more informed offer or
help the disputing parties reach a settlement before the certified IDR
entity makes a payment determination.
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\137\ Proposed 26 CFR 54.9816-8(b)(2)(ii)(A)(12), 29 CFR
2590.716-8(b)(2)(ii)(A)(12), and 45 CFR 149.510(b)(2)(ii)(A)(12).
\138\ Proposed 26 CFR 54.9816-8(b)(2)(ii)(A)(14), 29 CFR
2590.716-8(b)(2)(ii)(A)(14), and 45 CFR 149.510(b)(2)(ii)(A)(14).
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Requiring the initiating party to attest that the item or service
under dispute is a qualified IDR item or service and to identify the
basis for the attestation may reduce the number of ineligible disputes
submitted because it would require the initiating party to actively
evaluate eligibility before initiating the Federal IDR process. This
would help reduce the time certified IDR entities spend conducting
outreach to confirm whether
[[Page 75772]]
the item or service is eligible for the Federal IDR process.
Lastly, the Departments propose to remove paragraphs 26 CFR
54.9816-8T(b)(2)(iii)(B) and (C), 29 CFR 2590.716-8(b)(2)(iii)(B) and
(C), and 45 CFR 149.510(b)(2)(iii)(B) and (C), which specify the manner
in which the notice of IDR initiation must be provided to the other
party and the Departments. The Departments propose to establish
paragraphs 26 CFR 54.9816-8(b)(3), 29 CFR 2590.716-8(b)(3), and 45 CFR
149.510(b)(3) to require use of the Federal IDR portal for transmission
of notices of IDR initiation in the same manner as would be required
for the transmission of notices related to open negotiation discussed
in section II.D.3. of this preamble.
The Departments seek comment on these proposals. Specifically, the
Departments seek comment on the new content elements for the notice of
IDR initiation and whether additional elements should be required to
facilitate the exchange of information necessary to initiate the
Federal IDR process. Further, the Departments solicit comment on the
proposed requirement for the initiating party to include in the notice
of IDR initiation a statement describing any key aspects of the claim
discussed by the parties during open negotiation, whether the
considerations for initiating the Federal IDR process are different
from the key aspects of the claim discussed during the open negotiation
period, and an explanation of why the party is initiating the Federal
IDR process, including any of the permissible considerations described
at 26 CFR 54.9816-8(c)(4)(iii) and 54.9817-2(b)(2), 29 CFR 2590.716-
8(c)(4)(iii) and 2590.717-2(b)(2), and 45 CFR 149.510(c)(4)(iii) and
149.520(b)(2).
b. Notice of IDR Initiation Response
The Departments propose to amend 26 CFR 54.9816-8(b)(2)(i), 29 CFR
2590.716-8(b)(2)(i), and 45 CFR 149.510(b)(2)(i) to require that the
non-initiating party provide a written notice and supporting
documentation in response to the notice of IDR initiation to the
initiating party and the Departments within 3 business days after the
date of IDR initiation. As described in section II.D.2.a. of this
preamble, the initiating party must submit the notice of IDR initiation
through the Federal IDR portal. Upon proper submission of the notice of
IDR initiation by the initiating party, the Federal IDR portal would
facilitate transmittal of the notice of IDR initiation to the non-
initiating party. The non-initiating party would also receive the
notice of IDR initiation response form from the Federal IDR portal on
the date of IDR initiation, which is the date the Departments receive
the notice of IDR initiation. The Departments are of the view that it
is critical to require the non-initiating party to provide a response
to the notice of IDR initiation (including any objections regarding
preferred certified IDR entity selection and notice of any objection to
Federal IDR process eligibility) in order to increase transparency and
improve efficiencies in the Federal IDR process.
The Departments propose to add 26 CFR 54.9816-8(b)(2)(iii)(A), 29
CFR 2590.716-8(b)(2)(iii)(A), and 45 CFR 149.510(b)(2)(iii)(A), to
provide that the notice of IDR initiation response must include
information sufficient to identify the non-initiating party. Under the
proposed rules, the notice of IDR initiation response must include the
legal business name, email address, phone number, mailing address, the
TIN, the NPI, and the plan's or issuer's registration number, as
required under proposed 26 CFR 54.9816-9, 29 CFR 2590.716-9, and 45 CFR
149.530. These proposed rules would also require the notice to include
the name and contact information (including the legal business name,
email address, phone number, and mailing address) for any third party
representing the non-initiating party, and an attestation that the
third party has the authority to act on behalf of the party it
represents in the Federal IDR process.
The Departments also propose that the notice must include
information sufficient to identify each item or service included in the
notice of IDR initiation (including the date(s) the item or service was
furnished. If the non-initiating party is a provider, facility, or
provider of air ambulance services, the notice must include the date(s)
that the provider, facility, or provider of air ambulance services
received the initial payment or notice of denial of payment for such
item or service from the plan or issuer and the claim number). If the
non-initiating party is a plan or issuer, the proposed rules would
require a statement as to whether the non-initiating party agrees that
the initial payment (including $0 if, for example, payment is denied)
and the QPA reflected in the notice of IDR initiation was the initial
payment amount and/or the QPA disclosed with the initial payment or
notice of denial of payment for the item or service that is the subject
of the dispute, and if not, the initial payment amount (including $0
if, for example, payment is denied) and/or QPA it believes to be
correct, and documentation to support the statement (for example, the
remittance advice confirming the QPA). If the non-initiating party is a
plan or issuer, the notice must include the amount of cost sharing
imposed for the item or service, if any. If the non-initiating party is
a provider or facility, the notice must include a statement that the
items and services do not qualify for the notice and consent exception
described at Sec. 149.410(b) or Sec. 149.420(c) through (i).
With respect to each item or service that is the subject of the
dispute, the notice must also include an attestation that the item or
service is a qualified IDR item or service, or for each item or service
that the non-initiating party asserts is not a qualified IDR item or
service, an explanation and documentation to support the statement; a
statement confirming that the initial payment or notice of denial of
payment or other remittance advice provided by the initiating party
under paragraph (b)(2)(ii)(A)(12) is accurate, and if inaccurate, a
copy of the accurate initial payment or notice of denial of payment or
other remittance advice required to include the disclosures under 26
CFR 54.9816-6T(d)(1), 26 CFR 54.9816-6(d)(1), 29 CFR 2590.716-6(d)(1),
and 45 CFR 149.140(d)(1), with respect to the item or service; a
statement as to whether any of the information provided in the notice
of IDR initiation is inaccurate, the basis for the statement, and any
supporting documentation; and a statement as to whether the non-
initiating party agrees or objects to the initiating party's preferred
certified IDR entity. If the non-initiating party objects to the
initiating party's preferred certified IDR entity, the notice of IDR
initiation response must include the name of an alternative preferred
certified IDR entity and, if applicable, an explanation of any conflict
of interest with the initiating party's preferred certified IDR entity.
Most of the proposed notice of IDR initiation response content
requirements are included in the proposed open negotiation notice, open
negotiation response notice, and notice of IDR initiation content
requirements.\139\ As
[[Page 75773]]
discussed in sections II.D.1.d. and II.D.2.a., by restating information
on the notices, parties would have an opportunity to confirm or update
information necessary to continue negotiations and identify any
information discrepancies which could impact eligibility. Further, by
requiring this information at IDR initiation, it would reduce the
likelihood that additional outreach would be necessary to make
eligibility determinations, improving IDR dispute processing. As
discussed in section II.D.2.a. of this preamble, the Departments
anticipate that the Federal IDR portal would be able to prepopulate
information included in the open negotiation notice, open negotiation
response notice, and the notice of IDR initiation notice, which would
mitigate additional burden on the disputing parties.
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\139\ See proposed regulations for the open negotiation notice
content at: 26 CFR 54.9816-8(b)(1)(ii)(A)(1)-(6), (8)-(9), and (12);
29 CFR 2590.716-8(b)(1)(ii)(A)(1)-(6), (8)-(9), and (12); and 45 CFR
149.510(b)(1)(ii)(A)(1)-(6), (8)-(9), and (12). See proposed
regulations for the open negotiation response content at: 26 CFR
54.9816-8(b)(1)(iii)(A)(1)-(6), (8)-(9), and (11); 29 CFR 2590.716-
8(b)(1)(iii)(A)(1)-(6), (8)-(9), and (11); and 45 CFR
149.510(b)(1)(iii)(A)(1)-(6), (8)-(9), and (11). See proposed
regulations for the notice of IDR initiation content at: 26 CFR
54.9816-8(b)(2)(ii)(A)(1)-(3), (5)-(8), (10), and (12); 29 CFR
2590.716-8(b)(2)(ii)(A)(1)-(3), (5)-(8), (10), and (12); and 45 CFR
149.510(b)(2)(ii)(A)(1)-(3), (5)-(8), (10) and (12).
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The proposed rules also include additional content requirements for
the notice of IDR initiation response that require a statement as to
whether the non-initiating party agrees or objects to the initiating
party's preferred certified IDR entity and, if the non-initiating party
objects to the initiating party's preferred certified IDR entity, the
name of an alternative preferred certified IDR entity. This proposed
requirement is to meet the statutory requirement under Code section
9816(c)(4)(F), ERISA section 716(c)(4)(F), and PHS Act section 2799A-
1(c)(4)(F) that the Departments must provide a method for the plan or
issuer and the provider, facility, or provider of air ambulance
services that are parties to a determination subject to the Federal IDR
process to jointly select a certified IDR entity no later than 3
business days following the date of the IDR initiation. Section
II.E.1.a. of this preamble further describes the selection of the
certified IDR entity process and the proposed amendments to the
certified IDR entity selection process.
The Departments anticipate updating the Federal IDR portal to
create parameters to ensure information is submitted for each of the
required fields for the notice of IDR initiation and notice of IDR
initiation response. However, failure to timely furnish a notice of IDR
initiation response would not delay the timeframe for initiation of the
Federal IDR process (because the Federal IDR process has been initiated
once a notice of IDR initiation has timely been submitted to the non-
initiating party and the Departments) or delay any subsequent
timeframes under the Federal IDR process. As discussed in section
II.D.1.b. of this preamble, if a party were to fail to furnish a notice
of IDR initiation response to the other party and the Departments or
fail to fill out all of the required information in good faith (for
example, intentional omission of detail with the intent to advance the
process without providing sufficient content), the Departments would
review and determine whether enforcement actions may be warranted.
The Departments seek comment on these proposals, including any
administrative burden associated with the additional disclosure
requirements.
3. Manner of Notices
The October 2021 interim final rules generally require a party to
initiate open negotiations and initiate the Federal IDR process by
providing written notice to the other party.\140\ The party initiating
the Federal IDR process must also furnish the notice of IDR initiation
to the Departments through the Federal IDR portal. In both cases,
notice to the other party may be provided electronically if the
following two conditions are satisfied: (1) the party sending the open
negotiation notice has a good faith belief that the electronic method
is readily accessible to the other party; and (2) the notice is
provided in paper form free of charge upon request.\141\ As mentioned
in section II.D.1. and II.D.2. of this preamble, the Departments are
proposing to remove the regulatory text at 26 CFR 54.9816-
8T(b)(1)(ii)(B), (b)(2)(iii)(B), and (b)(2)(iii)(C), 29 CFR 2590.716-
8(b)(1)(ii)(B), (b)(2)(iii)(B), and (b)(2)(iii)(C), and 45 CFR
149.510(b)(1)(ii)(B), (b)(2)(iii)(B), and (b)(2)(iii)(C) and instead
include new requirements related to the manner of submission of open
negotiation notices and notices of IDR initiation to the Departments
and the other party at 26 CFR 54.9816-8(b)(3), 29 CFR 2590.716-8(b)(3),
and 45 CFR 149.510(b)(3). The Departments propose that these new
requirements would also apply to the open negotiation response notice
and the notice of IDR initiation response. Specifically, the
Departments propose that a party must furnish to the other party and
the Departments the notices and supporting documentation described in
proposed paragraphs (b)(1)(ii) (open negotiation notice), (b)(1)(iii)
(open negotiation response notice), (b)(2)(ii) (notice of IDR
initiation), and (b)(2)(iii) (notice of IDR initiation response)
through the Federal IDR portal, using the standard forms developed by
the Departments.
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\140\ 86 FR 55990.
\141\ 26 CFR 54.9816-8T(b)(1)(ii)(B), (b)(2)(iii)(B), and
(b)(2)(iii)(C), 29 CFR 2590.716-8(b)(1)(ii)(B), (b)(2)(iii)(B), and
(b)(2)(iii)(C), and 45 CFR 149.510(b)(1)(ii)(B), (b)(2)(iii)(B) and
(b)(2)(iii)(C).
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Under the current regulations, the open negotiation notice between
parties has taken place outside of the Federal IDR portal and has led
to challenges for the Departments and certified IDR entities to confirm
that all requirements related to the open negotiation notice and open
negotiation period have been satisfied for each initiated dispute.
Requiring a party to submit the open negotiation notice to the
Departments and the other party through the Federal IDR portal would
provide a record of whether and when the initiating party began open
negotiations, which would help inform whether the item or service that
is the subject of negotiation is eligible for the Federal IDR process.
The Departments expect that this would decrease the amount of time and
resources the Departments and certified IDR entities spend seeking
information from the disputing parties to determine whether the open
negotiation period was initiated and exhausted, which would ultimately
provide certified IDR entities more time to review eligible disputes.
As specified in the October 2021 interim final rules and set forth
in these proposed rules, the Departments are of the view that it is
important for a party receiving a notice to be furnished the notice on
the same day as it is submitted to the Departments, because many of the
timeframes required in the October 2021 interim final rules and
proposed in these proposed rules are triggered upon receipt of a
notice.\142\ Currently, when an initiating party submits the notice of
IDR initiation to the Federal IDR portal, the non-initiating party
receives a notice from the Departments on the same day the Departments
receive the notice of IDR initiation. This notice from the Departments
to the non-initiating party provides information contained in the
notice of IDR initiation. However, it does not include any of the
supporting documentation that the initiating party may have provided
with the notice of IDR initiation. While the initiating party is
required to directly furnish the notice of IDR initiation to the other
party, non-initiating parties report that, at times, the initiating
party provides the notice after the period for IDR initiation has
expired, although it submits the notice to the Departments within the
applicable notice period.
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\142\ 86 FR 55990 through 55991.
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If these proposed rules are finalized, the Departments would
enhance the Federal IDR portal to allow the parties to transmit
notices, including supporting documentation, through the Federal IDR
portal so that the party sending the notice can notify the
[[Page 75774]]
Departments and the other party at the same time. Further, as discussed
in sections II.D.1.c. and II.D.2.a. of this preamble, the Departments
are proposing to require similar content requirements in the open
negotiation notice and notice of IDR initiation. By streamlining the
submission of these notices, the Departments would be able to use
information that was submitted for one notice to pre-populate
subsequent notices, reducing the burden of providing duplicative
information. For instance, if a party decides to initiate the Federal
IDR process after submitting the open negotiation notice through the
Federal IDR portal and completing the 30-business-day open negotiation
period, the Departments intend that the Federal IDR portal would pre-
populate the fields in the notice of IDR initiation and notice of IDR
initiation response with the same information that was provided in the
open negotiation notice and open negotiation response notice, as
applicable. The Departments solicit comment on these proposals.
E. Federal IDR Process Following Initiation
1. Certified IDR Entity Selection and Eligibility Determinations
a. Certified IDR Entity Selection
Section 9816(c)(4)(F) of the Code, section 716(c)(4)(F) of ERISA,
section 2799A-1(c)(4)(F) of the PHS Act, and the October 2021 interim
final rules \143\ provide parties to a dispute 3 business days after
the initiation date of the Federal IDR process to jointly select a
certified IDR entity. If parties to a dispute fail to jointly agree and
select a certified IDR entity within the required timeframe, the
Departments must select the certified IDR entity no later than 6
business days after the initiation date of the Federal IDR process.
More specifically, under the current rules, the non-initiating party
may agree or object to the preferred certified IDR entity that the
initiating party identifies in its notice of IDR initiation. If the
non-initiating party fails to object within 3 business days after the
date of IDR initiation, the preferred certified IDR entity identified
in the notice of IDR initiation will be selected and will be treated as
jointly agreed to by the parties. In this case, the initiating party's
preferred certified IDR entity becomes the certified IDR entity for the
dispute, provided that the certified IDR entity does not have a
conflict of interest. If the non-initiating party objects to the
initiating party's preferred certified IDR entity, it must notify the
initiating party of the objection and propose an alternative preferred
certified IDR entity within 3 business days after the date of IDR
initiation. The initiating party must then agree or object to the
alternative preferred certified IDR entity within 3 business days after
the date of IDR initiation. If the initiating party fails to agree or
object to the alternative preferred certified IDR entity within that
timeframe, the alternative preferred certified IDR entity selected by
the non-initiating party will be selected and will be treated as
jointly agreed to by the parties. If the parties fail to jointly agree
on a certified IDR entity within 3 business days after the date of IDR
initiation, the Departments select a certified IDR entity through
random selection.\144\
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\143\ 87 FR 55991 through 55992.
\144\ 26 CFR 54.9816-8T(c)(1)(iv), 29 CFR 2590.716-8(c)(1)(iv),
and 45 CFR 149.510(c)(1)(iv).
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Further, under the current rules, upon the joint selection of a
certified IDR entity the initiating party must provide a notice of
certified IDR entity selection to the Departments indicating whether
the parties have jointly agreed or failed to agree on the selection of
a certified IDR entity, as soon as practicable but no later than 1
business day after selection.\145\ The notification must include an
attestation by both parties, or by the initiating party if the non-
initiating party fails to object to the selection of the certified IDR
entity, that the selected certified IDR entity does not have a conflict
of interest as specified in 26 CFR 54.9816-8(c)(1)(ii), 29 CFR
2590.716-8(c)(1)(ii), and 45 CFR 149.510(c)(1)(ii).\146\ Under the
current rules, after the selection of the certified IDR entity by the
parties (including when the initiating party selects a certified IDR
entity and the non-initiating party does not object), or by the
Departments when the parties fail to select a certified IDR entity, the
certified IDR entity must review the selection and attest that it meets
these conflict-of-interest requirements.\147\ If the certified IDR
entity is unable to attest that it meets the conflict-of-interest
requirements within 3 business days of selection, the parties, upon
notification, must select another certified IDR entity. In such
circumstances, the date of the notification sent by the certified IDR
entity informing the parties that it cannot attest that it meets the
conflict-of-interest requirements is treated as the date of IDR
initiation for the purposes of selecting a new certified IDR entity.
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\145\ 26 CFR 54.9816-8T(c)(1)(iii)-(iv), 29 CFR 2590.716-
8(c)(1)(iii)-(iv), and 45 CFR 149.510(c)(1)(iii)-(iv).
\146\ 26 CFR 54.9816-8T(c)(1)(iii)(A)(3), 29 CFR 2590.716-
8(c)(1)(iii)(A)(3), and 45 CFR 149.510(c)(1)(iii)(A)(3).
\147\ 26 CFR 54.9816-8T(c)(1)(v), 29 CFR 2590.716-8(c)(1)(v),
and 45 CFR 149.510(c)(1)(v).
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Since implementation of the Federal IDR process, the Departments
have identified potential areas to improve upon and provide additional
clarity with respect to the process for selecting a certified IDR
entity. First, in the Departments' experience implementing these rules,
when a non-initiating party waits until the third business day after
the date of IDR initiation to select an alternative preferred certified
IDR entity, the initiating party lacks sufficient time to agree or
object to the alternative preferred certified IDR entity. As a result,
the alternative preferred certified IDR entity will be ``jointly''
selected by default. The Departments are of the view that in order for
a certified IDR entity to be ``jointly'' selected, the parties must
agree on, or be given the opportunity to object to that certified IDR
entity. Therefore, the Departments propose to amend the process for
selecting a certified IDR entity when the parties fail to jointly agree
on a certified IDR entity under section 9816(c)(4)(F)(i) of the Code,
section 716(c)(4)(F)(i) of ERISA, and section 2799A-1(c)(4)(F)(i) of
the PHS Act.
Second, as part of the current operations, the Federal IDR portal
automates the process for selecting the certified IDR entity such that
the initiating party and the non-initiating party communicate directly
through the Federal IDR portal when selecting, agreeing to, or
objecting to a certified IDR entity. Therefore, the Departments are
notified automatically through the Federal IDR portal if both parties
have jointly agreed on a certified IDR entity. Similarly, when the
Departments select a certified IDR entity, the disputing parties are
notified automatically, provided the selected certified IDR entity
attests to having no conflicts of interest. As described in section
II.D. of this preamble, if finalized, these proposed rules would
collect information regarding the applicability of the Federal IDR
process from both parties as part of the proposed notice of IDR
initiation and notice of IDR initiation response requirements. Because
this information is automated through the Federal IDR portal or would
be collected at other points of the IDR initiation process, the
Departments propose to amend the notice of certified IDR entity
selection requirements of 26 CFR 54.9816-8(c)(1)(iii), 29 CFR 2590.716-
8(c)(1)(iii), and 45 CFR 149.510(c)(1)(iii) and establish at 26 CFR
54.9816-8(c)(1)(i)(D), 29 CFR 2590.716-8(c)(1)(i)(D), and 45 CFR
[[Page 75775]]
149.510(c)(1)(i)(D) the mechanism for parties to agree or object and
select another alternative preferred certified IDR entity after the
non-initiating party submits the notice of IDR initiation response form
and before the deadline for parties to jointly select a certified IDR
entity, which is within 3 business days after the date of IDR
initiation.
Lastly, to provide clarity on the Federal IDR process timeframes,
in the Federal IDR Process Guidance for Certified IDR Entities and the
Federal IDR Process Guidance for Disputing Parties, the Departments
clarified that the certified IDR entity is ``preliminarily'' selected
until it attests that it does not have a conflict of interest and
determines whether the Federal IDR Process is applicable, thereby
finalizing the selection.\148\ The guidance further clarifies that the
certified IDR entities must submit their conflict-of-interest
attestation within 3 business days of being contingently selected, and
that the parties must submit their offers for an out-of-network payment
amount, as specified in 26 CFR 54.9816-8(c)(4)(i), 29 CFR 2590.716-
8(c)(4)(i), and 45 CFR 149.510(c)(4)(i) no later than 10 business days
after final selection of the certified IDR entity. To provide further
clarity and to codify the process and timeframes for selecting a
certified IDR entity, the certified IDR entity's conflict-of-interest
review, and the date the certified IDR entity selection is considered
finally selected, the Departments propose to amend 26 CFR 54.9816-
8(c)(1), 29 CFR 2590.716-8(c)(1), and 45 CFR 149.510(c)(1) to establish
a process that includes both preliminary selection of the certified IDR
entity and final selection of the certified IDR entity.
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\148\ See https://www.cms.gov/files/document/federal-idr-guidance-idr-entities-march-2023.pdf and https://www.cms.gov/files/document/federal-idr-guidance-disputing-parties-march-2023.pdf.
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i. Preliminary Selection of the Certified IDR Entity
The Departments propose to amend 26 CFR 54.9816-8T(c)(1)(i), 29 CFR
2590.716-8(c)(1)(i), and 45 CFR 149.510(c)(1)(i) to establish the
preliminary selection of the certified IDR entity in accordance with
the statutory requirement at section 9816(c)(4)(F) of the Code, section
716(c)(4)(F) of ERISA, and section 2799A-1(c)(4)(F) of the PHS Act.
Under the process for preliminary selection of the certified IDR entity
proposed in these rules, the non-initiating party would be required to
agree or object to the preferred certified IDR entity in the notice of
IDR initiation response within 3 business days after the date of IDR
initiation as discussed in section II.D.2.b of this preamble. Under
these proposed rules, if the non-initiating party agrees, or fails to
object, to the selection of the initiating party's preferred certified
IDR entity in the notice of IDR initiation response within the 3-
business-day timeframe after the date of IDR initiation, the initiating
party's preferred certified IDR entity would be considered jointly
selected by the parties on the third business day after the date of IDR
initiation. If the non-initiating party objects to the selection of the
initiating party's preferred certified IDR entity by designating an
alternative preferred certified IDR entity in the notice of IDR
initiation response within the 3-business-day timeframe after the date
of IDR initiation, the initiating party would be required to agree or
object to the alternative preferred certified IDR entity using the
notice of certified IDR entity selection. Under these proposed rules,
if the initiating party agrees to the alternative preferred certified
IDR entity within 3 business days after the date of IDR initiation, or
if the non-initiating party submits the notice of IDR initiation
response on or before the second business day after the date of IDR
initiation and the initiating party fails to respond within 3 business
days after the date of IDR initiation, the alternative preferred
certified IDR entity would be considered jointly selected by the
parties. If the non-initiating party submits the notice of IDR
initiation response on the third business day after the date of IDR
initiation and the initiating party does not agree on the same day, the
parties would have failed to jointly select a certified IDR entity.
Additionally, these proposed rules would amend the process for the
initiating and non-initiating parties to go back-and-forth in selecting
and responding to a selection of an alternative preferred certified IDR
entity after the non-initiating party submits a notice of IDR
initiation response within the 3-business-day period after IDR
initiation. Specifically, if a certified IDR entity is not jointly
selected because the initiating party submits a notice of certified IDR
entity selection objecting to the non-initiating party's alternative
preferred certified IDR entity reflected in the notice of IDR
initiation response, the non-initiating party may agree to the
alternative preferred certified IDR entity selected in the initiating
party's notice of certified IDR entity selection or select another
alternative preferred certified IDR entity by submitting a notice of
certified IDR entity selection to the initiating party and to the
Departments. This back-and-forth may continue until the earlier of the
date that the parties agree on an alternative preferred certified IDR
entity or the deadline for joint selection, which is 3 business days
after the date of IDR initiation. However, if either the notice of IDR
initiation response or the notice of certified IDR entity selection is
submitted on the third business day after the date of IDR initiation,
the party last in receipt of the applicable notice would not be allowed
to select another alternative preferred certified IDR entity, as
discussed later in this section of the preamble. Once a party submits a
notice of certified IDR entity selection, it may not submit another
notice of IDR entity selection until after it receives a responding
notice of certified IDR entity selection from the other party.
If a party submits a notice of certified IDR entity selection to
the other party on the first or second day after the date of IDR
initiation and the party in receipt of the notice agrees or fails to
object to the alternative preferred certified IDR entity by the third
business day after the date of IDR initiation, the alternative
preferred certified IDR entity would be considered jointly selected by
the parties. If a party submits a notice of certified IDR entity
selection to the other party on the third business day after the date
of IDR initiation and the party last in receipt of the notice agrees to
the alternative preferred certified IDR entity on the same day, the
alternative preferred certified IDR entity will be considered jointly
selected by the parties. If a party submits a notice of certified IDR
entity selection to the other party on the third business day after the
date of IDR initiation and the party last in receipt of the notice does
not agree to the alternative preferred certified IDR entity on the same
day, the parties would have failed to jointly select a certified IDR
entity.
Under these proposed rules at 26 CFR 54.9816-8(c)(1)(i)(D), 29 CFR
2590.716-8(c)(1)(i)(D), and 45 CFR 149.510(c)(1)(i)(D), to notify the
Departments and the other party of any subsequent agreement or
objection to an alternative preferred certified IDR entity after the
non-initiating party submits the notice of IDR initiation response, a
party must submit a notice of certified IDR entity selection. The party
must furnish the notice of certified IDR entity selection using the
standard form developed by the Departments through the Federal IDR
portal within 3 business days after the date of IDR initiation.
The Departments propose to amend the existing content of the notice
of certified IDR entity selection and specify that the notice must
include a
[[Page 75776]]
statement indicating the party's agreement with or objection to the
other party's alternative preferred certified IDR entity and, if
applicable, an explanation of any conflict of interest with the other
party's alternative preferred certified IDR entity. If the party in
receipt of a notice of certified IDR entity selection objects to the
other party's alternative preferred certified IDR entity and the party
submits a notice of certified IDR entity selection by the end of the
third business day after the date of IDR initiation, that party's
notice of certified IDR entity selection reflecting the objection must
include the name of another alternative preferred certified IDR entity.
The Departments propose to amend 26 CFR 54.9816-8(c)(1)(iv), 29 CFR
2590.716-8(c)(1)(iv), and 45 CFR 149.510(c)(1)(iv), which describe the
certified IDR entity selection process when the disputing parties fail
to jointly select a certified IDR entity, and redesignate the
paragraphs as amended 26 CFR 54.9816-8(c)(1)(ii), 29 CFR 2590.716-
8(c)(1)(ii), and 45 CFR 149.510(c)(1)(ii). If the parties fail to
jointly select a certified IDR entity within 3 business days after the
date of IDR initiation, the Departments would select a certified IDR
entity. The parties would have failed to jointly select a certified IDR
entity if, by the end of the third business day after the date of IDR
initiation, the party last in receipt of the notice of IDR initiation
response or the notice of certified IDR entity selection has objected
to the other party's alternative preferred certified IDR entity, or if
the notice of IDR initiation response or the notice of certified IDR
entity selection is submitted to the other party on the third business
day after the date of IDR initiation and the party in receipt of the
notice does not agree to the alternative preferred certified IDR entity
within 3 business days after the date of IDR initiation.
As part of the Departments' process to select a certified IDR
entity when the parties do not jointly select one,\149\ under these
proposed rules, the Departments would first confirm whether a party
submitted the notice of IDR initiation response or notice of certified
IDR entity selection with an alternative preferred certified IDR entity
on the third business day after the date of IDR initiation without the
other party's agreement to the selection. If either notice was provided
on the third business day after the date of IDR initiation without the
other party's agreement to the alternative preferred certified IDR
entity by the end of third business day after the date of IDR
initiation, the Departments would provide the party last in receipt of
the applicable notice 2 additional business days to either agree or
object to the other party's alternative preferred certified IDR entity
selection. In these circumstances, under these proposed rules, if a
party last in receipt of the notice of IDR initiation response or the
notice of certified IDR entity selection agrees with the other party's
alternative preferred certified IDR entity and notifies the Departments
of the agreement or fails to notify the Departments of its objection in
the Federal IDR portal by the fifth business day after the date of IDR
initiation, the Departments would select the final alternative
preferred certified IDR entity selected in the applicable notice. In
disputes where the applicable notice was submitted on the third
business day after the date of IDR initiation, the party last in
receipt of the notice would not be allowed to select another
alternative preferred certified IDR entity. If the party last in
receipt of the notice notifies the Departments of its objection to the
alternative preferred certified IDR entity by the fifth business day
after the date of IDR initiation, the Departments would proceed with
the random selection of the certified IDR entity from among the
certified IDR entities (other than the preferred certified IDR entity
and any alternative preferred certified IDR entity previously selected
in such dispute by a party, unless there is no other certified IDR
entity available to select) that charge a fee within the allowed range
of certified IDR entity fees on the sixth business day after the date
of IDR initiation. If there are insufficient certified IDR entities
that charge a fee within the allowed range of certified IDR entity fees
available to arbitrate the dispute, the Departments would select a
certified IDR entity that has received approval, as described in
paragraph 26 CFR 54.9816-8T(e)(2)(vii)(B), 29 CFR 2590.716-
8(e)(2)(vii)(B), and 45 CFR 149.510(e)(2)(vii)(B), to charge a fee
outside of the allowed range of certified IDR entity fees. In either
case, the Departments would notify the parties of the preliminarily
selected certified IDR entity not later than 6 business days after the
date of IDR initiation. The Departments are of the view that this
proposed requirement would give each party a reasonable opportunity to
review the other party's alternative preferred selected certified IDR
entity and to notify the other party and the Departments whether the
party agrees or disagrees with the selection. Consistent with section
9816(c)(4)(F) of the Code, section 716(c)(4)(F) of ERISA, and section
2799A-1(c)(4)(F) of the PHS Act, these requirements would ensure that
the certified IDR entity selection timeframe occurs within 6 business
days after the date of Federal IDR initiation, when the parties do not
jointly select the certified IDR entity.
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\149\ Section 9816(c)(4)(F)(ii) of the Code, section
716(c)(4)(F)(ii) of ERISA, and section 2799A-1(c)(4)(F)(ii) of the
PHS Act.
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The Departments also propose to amend 26 CFR 54.9816-8T(c)(1)(iii),
29 CFR 2590.716-8(c)(1)(iii), and 45 CFR 149.510(c)(1)(iii) to provide
that the date of preliminary selection of the certified IDR entity is 3
business days after the date of IDR initiation if the parties jointly
selected a certified IDR entity, or 6 business days after the date of
IDR initiation if the parties fail to jointly select a certified IDR
entity and the Departments instead select the certified IDR entity.
The Departments seek comment on these proposals.
ii. Final Selection of the Certified IDR Entity and Certified IDR
Entity Conflict-of-Interest Review
The Departments propose to add 26 CFR 54.9816-8(c)(1)(iv), 29 CFR
2590.716-8(c)(1)(iv), and 45 CFR 149.510(c)(1)(iv) to establish the
process for finalizing certified IDR entity selection. Under the
proposed rules, the date of final selection of the certified IDR entity
would be the date that triggers the timeframes for the requirement to
issue payment determinations (not later than 30 business days after the
date of final selection of the certified IDR entity) and the submission
of offers from both parties (not later than 10 business days after the
date of final selection of the certified IDR entity) under section
9816(c)(5)(A) and (B) of the Code, section 716(c)(5)(A) and (B) of
ERISA, and section 2799A-1(c)(5)(A) and (B) of the PHS Act.
The statute provides that a certified IDR entity must meet certain
conflict-of-interest standards before being selected as a certified IDR
entity assigned to make a payment determination. However, the statute
is silent on the specific timeframe or process for the selected
certified IDR entity to review the parties' (or the Departments')
selection to ensure that a conflict of interest does not exist. Based
on feedback from interested parties and the Departments' experience
with implementation of the Federal IDR process, the Departments are of
the view that it is important to implement a timeframe that permits a
meaningful opportunity for conflict-of-interest
[[Page 75777]]
review by the certified IDR entity while ensuring that it does not
limit the time periods for either disputing parties to submit their
offers or for the certified IDR entity to make a payment determination.
To streamline this process, the Departments are of the view that
permitting the certified IDR entity to be considered preliminarily
selected until the certified IDR entity confirms that it has no
conflict of interest with either party, would increase the efficiency
of the process while balancing the need to ensure that certified IDR
entities are free of conflict.
After the certified IDR entity is preliminarily selected pursuant
to 26 CFR 54.9816-8(c)(1)(iii), 29 CFR 2590.716-8(c)(1)(iii), and 45
CFR 149.510(c)(1)(iii), the Departments propose that the preliminarily
selected certified IDR entity would review the selection and attest to
the Departments whether it meets the conflict-of-interest requirements
as outlined in proposed 26 CFR 54.9816-8(c)(1)(iv)(A)(1) through (3),
29 CFR 2590.716-8(c)(1)(iv)(A)(1) through (3), and 45 CFR
149.510(c)(1)(iv)(A)(1) through (3). The Departments are not proposing
new conflict-of-interest requirements, however, the Departments are
proposing to make non-substantive amendments to improve clarity and
align with the structure of the reorganized provisions as follows: (1)
the certified IDR entity does not have a conflict of interest as
defined in paragraphs 26 CFR 54.9816-8(a)(2)(iv), 29 CFR 2590.716-
8(a)(2)(iv), and 45 CFR 149.510(a)(2)(iv); (2) the certified IDR entity
will only assign personnel to a dispute and make decisions regarding
hiring, compensation, termination, promotion, or other similar matters
related to personnel assigned to the dispute in a manner that is not
based upon the likelihood that the assigned personnel will support a
particular party to the dispute; and (3) the certified IDR entity will
not assign any personnel to a dispute who would have any conflicts of
interest, as defined in paragraphs 26 CFR 54.9816-8(a)(2)(iv), 29 CFR
2590.716-8(a)(2)(iv), and 45 CFR 149.510(a)(2)(iv), regarding any party
to the dispute or whose relationship with a party within the 1 year
immediately preceding the assignment to the dispute would violate the
restrictions on aiding or advising a former employer or principal in a
manner similar to the restrictions set forth in 18 U.S.C. 207(b).
Under 26 CFR 54.9816-8(c)(1)(iv)(B), 29 CFR 2590.716-
8(c)(1)(iv)(B), and 45 CFR 149.510(c)(1)(iv)(B), the Departments also
propose that if the certified IDR entity notifies the Departments
within 3 business days of the date of preliminary selection of the
certified IDR entity that it does not meet the conflict-of-interest
requirements or does not respond within 3 business days after the date
of preliminary selection of the certified IDR entity, the Departments
would randomly select another certified IDR entity. The Departments
would notify the parties of the new randomly preliminarily selected
certified IDR entity no later than 1 business day after the previously
selected certified IDR entity notifies the Departments that it has a
conflict of interest, or if the previously selected certified IDR
entity fails to respond within 3 business days after the date of
preliminary selection of the certified IDR entity, no later than 1
business day after the end of the 3-business-day period.
These proposed rules would streamline the process for certified IDR
entity selection when the preliminarily selected certified IDR entity
fails to timely respond or notifies the Departments that it cannot meet
the conflict-of-interest requirements in proposed 26 CFR 54.9816-
8(c)(1)(iv)(A), 29 CFR 2590.716-8(c)(1)(iv)(A), and 45 CFR
149.510(c)(1)(iv)(A). Under the October 2021 interim final rules, when
a selected certified IDR entity is unable to attest that it has no
conflict of interest within 3 business days of certified IDR entity
selection, the parties to the dispute are given another opportunity to
jointly agree on a certified IDR entity, and the end of the 3-business-
day period is treated as the date of initiation of the Federal IDR
process. Under these proposed rules, when a preliminarily selected
certified IDR entity provides notice of a conflict of interest, the
Departments would select another certified IDR entity through random
selection, as opposed to allowing the parties additional opportunities
to jointly select a different certified IDR entity, in order to create
operational efficiencies and minimize delays in processing disputes.
Additionally, if the certified IDR entity does not respond to the
conflict-of-interest review by the end of the 3-business-day period
after preliminary selection of the certified IDR entity, the
Departments would randomly select another certified IDR entity. If a
certified IDR entity cannot review and provide a response related to a
conflict of interest within a 3-business-day period, the dispute would
move to a different certified IDR entity that may have the capacity to
review the dispute in a timelier manner, which would improve the
overall timeliness of dispute processing.
Under 26 CFR 54.9816-8(c)(1)(iv)(C), 29 CFR 2590.716-
8(c)(1)(iv)(C), and 45 CFR 149.510(c)(1)(iv)(C) of these proposed
rules, if the certified IDR entity that has been preliminarily selected
attests within 3 business days that it meets the conflict-of-interest
requirements, the Departments would notify the parties of the final
selection of that certified IDR entity no later than 1 business day
after the certified IDR entity attests that it meets the conflict-of-
interest requirements The date of final selection of the certified IDR
entity is the date that the Departments provide this notice to the
parties.
Lastly, the Departments also propose to remove 26 CFR 54.9816-
8T(c)(1)(v), 29 CFR 2590.716-8(c)(1)(v), and 45 CFR 149.510(c)(1)(v),
as these requirements regarding certified IDR entity conflict of
interest and Federal IDR process eligibility review would be required
under the paragraphs at 26 CFR 9816-8(c)(1)(iv)(A), 29 CFR 2590.716-
8(c)(1)(iv)(A), and 45 CFR 149.510(c)(1)(iv)(A) and 26 CFR 9816-
8(c)(2), 29 CFR 2590.716-8(c)(2), and 45 CFR 149.510(c)(2),
respectively.
The Departments seek comment on these proposals.
b. Federal IDR Process Eligibility Review
i. Federal IDR Process Eligibility Determination by Certified IDR
Entity
The No Surprises Act does not specify a timeframe or process for
which the Departments or certified IDR entities must assess a dispute's
eligibility for the Federal IDR process. Under the October 2021 interim
final rules, certified IDR entities are required to review the
information in the notice of IDR initiation and notice of certified IDR
entity selection to determine whether the Federal IDR process applies
and if not, to notify the Departments within 3 business days of making
that determination.\150\ The Departments further clarified in the
Federal IDR Process Guidance for Certified IDR Entities \151\ that
certified IDR entities must make this eligibility determination within
3 business days after they are selected, which is before the parties
must submit an offer of an out-of-network rate (not later than 10
business days after the date of selection of the certified IDR entity)
and before the certified IDR entity must make a
[[Page 75778]]
payment determination (30 business days after the date of selection of
the certified IDR entity).
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\150\ 26 CFR 54.9816-8T(c)(1)(v), 29 CFR 2590.716-8(c)(1)(v),
and 45 CFR 149.510(c)(1)(v).
\151\ U.S. Department of Health and Human Services, U.S.
Department of Labor, and U.S. Department of the Treasury. (Oct.
2022). Federal Independent Dispute Resolution (IDR) Process Guidance
for Certified IDR Entities. https://www.cms.gov/CCIIO/Resources/Regulations-and-Guidance/Downloads/Federal-Independent-Dispute-Resolution-Process-Guidance-for-Certified-IDR-Entities.pdf.
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To provide certified IDR entities additional time to conduct
eligibility reviews before the parties must submit their offers, the
Departments propose to remove 26 CFR 54.9816-8T(c)(1)(v), 29 CFR
2590.716-8(c)(1)(v), and 45 CFR 149.510(c)(1)(v), and add proposed 26
CFR 54.9816-8(c)(2)(i), 29 CFR 2590.716-8(c)(2)(i), and 45 CFR
149.510(c)(2)(i), which would allow certified IDR entities 5 business
days after the date of final selection of the certified IDR entity to
make an eligibility determination. Under these proposed rules, unless
the departmental eligibility review described in section II.E.1.b.ii.
of this preamble applies, the selected certified IDR entity would be
required to review the information in the notice of IDR initiation, the
notice of IDR initiation response, and any additional information as
discussed in proposed 26 CFR 54.9816-8(c)(2)(iii), 29 CFR 2590.716-
8(c)(2)(iii), and 45 CFR 149.510(c)(2)(iii), and make a final
determination as to whether the item or service is a qualified IDR item
or service that is eligible for the Federal IDR process. The certified
IDR entity would be required to make this eligibility determination and
notify the Departments and both parties no later than 5 business days
after the date of final selection of the certified IDR entity. If the
certified IDR entity determines that the item or service is not a
qualified IDR item or service, the dispute would be closed, and the
selected certified IDR entity would not take any action with regard to
the dispute.
The Departments propose to provide 2 additional business days for
certified IDR entities to review the notices and make an eligibility
determination. This proposal would provide additional time while
meeting the statutory requirement that the submission of offers be
submitted no later than 10 days after the date of certified IDR entity
selection.\152\ More specifically, under these proposed rules, the
certified IDR entity would be required to determine whether a dispute
was eligible for the Federal IDR process not later than 5 business days
after the date of final selection of the certified IDR entity and if
eligible, the parties to the dispute would be required to submit their
offers not later than 10 business days after the final selection of the
certified IDR entity (which would be at least 5 business days after the
eligibility determination). Although currently eligibility reviews are
generally taking certified IDR entities longer than 5 business days,
these proposed rules are intended to facilitate more efficient
processing of eligibility reviews, and the Departments therefore expect
that 5 business days would be sufficient for this purpose if these
proposed rules are finalized. Further, these proposed rules intend to
balance the time certified IDR entities have to conduct eligibility
reviews with the time parties are given to submit their final offers.
Because the No Surprises Act provides only 10 days from the date of
certified IDR entity selection for the parties to submit their offers,
these proposed rules would provide equal time for eligibility review
and for the parties to submit their offers after the eligibility
review.
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\152\ Section 9816(c)(5)(B) of the Code, section 716(c)(4)(B) of
ERISA, and section 2799A-1(c)(4)(B) of the PHS Act.
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A non-initiating party's attestation that a dispute is ineligible
for the Federal IDR process, alone, would be insufficient to
substantiate a determination of ineligibility. The certified IDR entity
(or the Departments, if conducting eligibility reviews as described in
section II.E.1.b.ii. of this preamble) would review disputes for
eligibility in all instances.
The Departments seek comment on these proposals, including the
appropriate amount of time certified IDR entities should be provided to
conduct eligibility reviews.
ii. Departmental Eligibility Review for Federal IDR Process Eligibility
Determinations
Even if the proposals in these proposed rules are finalized and the
intended results of a more efficient eligibility review process and
fewer ineligible initiated disputes are realized, circumstances may
still arise where the Departments would need to take actions to
facilitate more timely dispute processing, such as when the volume of
disputes outpaces the capacity of certified IDR entities to timely
process eligibility determinations. To address such circumstances, and
provide for such flexibility, the Departments propose adding 26 CFR
54.9816-8(c)(2)(ii), 29 CFR 2590.716-8(c)(2)(ii), and 45 CFR
149.510(c)(2)(ii), which would establish an eligibility review process
whereby, when the conditions set forth in 26 CFR 54.9816-
8(c)(2)(ii)(A), 29 CFR 2590.716-8(c)(2)(ii)(A), and 45 CFR
149.510(c)(2)(ii)(A) are met, as described in section II.E.1.b.ii. of
this preamble, the Departments would conduct the eligibility review and
make the eligibility determination on behalf of the certified IDR
entity (departmental eligibility review).
Under these proposed rules, if the Departments determine that an
item or service is not a qualified IDR item or service, the dispute
would be closed, and the preliminarily selected certified IDR entity
would not take any action regarding the dispute. If the dispute were
found to be eligible, the Departments would inform the preliminarily
selected certified IDR entity of eligibility so that it may conduct its
conflict-of-interest assessment, and the dispute would otherwise
continue through the Federal IDR process, including notification of the
eligibility determination to the disputing parties by the preliminarily
selected certified IDR entity.
From the disputing parties' perspectives, Federal IDR process
operations during departmental eligibility reviews would largely be
unchanged. Timeframes and processes to initiate the Federal IDR
process, conduct certified IDR entity selection, and submit offers
would be the same. The noticeable differences for disputing parties
would be that correspondence related to a dispute's eligibility,
including any related information requests, would come from the
Departments, rather than one of the certified IDR entities, and the
potential impact departmental eligibility reviews may have on the
administrative fee as outlined in section II.E.3.a. of this preamble.
Additionally, depending on dispute volume and other factors impacting
the Departments' decision to conduct eligibility reviews, the
Departments may choose to exercise their authority to extend time
periods for extenuating circumstances as discussed in section II.E.5.
of this preamble to allow more time for the Departments to conduct
eligibility reviews. This proposed approach is similar to what is
currently occurring under the technical assistance provided to
certified IDR entities that was announced in November 2022.\153\ The
principal difference is that under these proposed rules, when
departmental eligibility review is in effect, the Departments would be
able to close a case after determining it is ineligible, rather than
forwarding the Departments' eligibility recommendation to the certified
IDR entity to make the final eligibility determination.
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\153\ See https://www.cms.gov/files/document/idre-eligibility-support-guidance-11212022-final-updated.pdf.
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For certified IDR entities, the Federal IDR process operations
under the proposed departmental eligibility reviews would also function
similarly to current operations except that, to
[[Page 75779]]
prevent certified IDR entities from conducting duplicative eligibility
screenings, a certified IDR entity would not be notified of their
selection for the purposes of their conflict-of-interest review until
after eligibility has been determined by the Departments. The
Departments are proposing the departmental eligibility review under
certain circumstances to relieve the burden on certified IDR entities
and to ensure that they can focus their time and resources on payment
determinations in accordance with statutory timeframes. For the reasons
discussed in section I.H. of this preamble, eligibility determinations
have proven to be complex and time-consuming for certified IDR
entities, and certified IDR entities are not compensated for the time
and effort expended in assessing dispute eligibility when a dispute is
determined ineligible for the Federal IDR process. This is because the
statute provides that certified IDR entities may only retain their fees
from the non-prevailing party to a dispute (unless the dispute is
withdrawn or settled as discussed in section II.E.1.d. of this
preamble). Moreover, some certified IDR entities have been unable to
accept new disputes because they are overburdened with making
eligibility determinations. Certified IDR entities have informally
reported to the Departments during regular communications that they
spend 50-80 percent of their time on making eligibility determinations
and a few certified IDR entities have had to temporarily suspend
accepting new disputes to manage their backlogs. When they are focused
on eligibility challenges, certified IDR entities have less time and
fewer resources to devote to making timely payment determinations.
Ultimately, the certified IDR entities' participation in the
Federal IDR process is voluntary and must be financially sustainable.
Furthermore, the No Surprises Act directs the Departments to administer
the Federal IDR process in a manner that ensures participation by a
sufficient number of certified IDR entities.\154\ If certified IDR
entities decline to participate because it is not economically viable
to do so, the directive of the statute is defeated. Thus, the ability
for certified IDR entities to obtain fair compensation for the work
conducted is critical to the success of the Federal IDR process, and
the Departments are therefore of the view that it is in the best
interests of all parties to reduce the burden of eligibility
determinations when feasible.
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\154\ Section 9816(c)(4)(E) of the Code, section 716(c)(4)(E) of
ERISA, and section 2799A-1(c)(4)(E) of the PHS Act.
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The Departments intend for their role in conducting eligibility
determinations to be temporary. The Departments are of the view that
when eligibility determinations are less burdensome and the volume of
disputes is manageable, certified IDR entities are better equipped to
conduct eligibility determinations. Further, the Departments do not
possess the staff or resources to carry out the eligibility
determinations in the long term and must retain contract support to
carry out the eligibility determinations in the short term. The
Departments acknowledge that any increased expenditures related to
conducting final eligibility determinations would be reflected in the
non-refundable Federal IDR administrative fees because these fees must
reflect the amount of expenditures estimated to be made by the
Departments for the year in carrying out the Federal IDR process.\155\
Therefore, the Departments would not intend to continue this role if
the other proposed policies in these rules, along with ongoing Federal
IDR portal improvements, are successful in improving dispute processing
and reducing the volume of ineligible disputes.
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\155\ Section 9816(c)(8) of the Code, section 716(c)(8) of
ERISA, and section 2799A-1(c)(8) of the PHS Act. Also see IDR
Process Fees proposed rules at 88 FR 65893 (Sept. 26, 2023).
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iii. Application of the Departmental Eligibility Review
The departmental eligibility review would apply when the
Departments determine that extenuating circumstances under proposed 26
CFR 54.9816-8(g)(1), 29 CFR 2590.716-8(g)(1), and 45 CFR 149.510(g)(1)
require application of the departmental eligibility review to
facilitate timely payment determinations or the effective processing of
disputes under the Federal IDR process.
iv. Notification Regarding Applicability of the Departmental
Eligibility Review
Before invoking the application of the departmental eligibility
review, the Departments propose to post advance public notification of
the date on which the departmental eligibility review would take
effect, and the reasons for invoking the application of the
departmental eligibility review. Before ending the application of the
departmental eligibility review, the Secretary will post advance public
notification of the date on which the departmental eligibility review
would no longer be in effect and the reasons for ending the application
of the departmental eligibility review, as applicable.
The Departments seek comment on these proposals, including whether
the departmental eligibility reviews, when they are applicable, should
be applied to all certified IDR entities or if the Departments should
apply these proposed rules to only the certified IDR entities with
significant dispute backlogs.
c. Request for Additional Information
Based on the Departments' experience operating the Federal IDR
process, disputing parties have not consistently submitted all
information necessary for a certified IDR entity to make an eligibility
determination, a conflict-of-interest assessment, or a payment
determination. Certified IDR entities frequently must reach out to the
disputing parties, sometimes multiple times, to obtain the required
information. Such outreach is time intensive, inefficient, and costly.
Even as the Departments propose other methods to promote information
submission by disputing parties throughout the Federal IDR process (as
described throughout this preamble), certified IDR entities and the
Departments likely will still need to collect additional information to
make accurate determinations in a timely fashion. Thus, using the
general rulemaking authority granted to the Departments to establish
the Federal IDR process under section 9816(c)(2)(A) of the Code,
section 716(c)(2)(A) of ERISA, and section 2799A-1(c)(2)(A) of the PHS
Act, the Departments are proposing in new 26 CFR 54.9816-8(c)(2)(iii),
29 CFR 2590.716-8(c)(2)(iii), and 45 CFR 149.510(c)(2)(iii) to
establish that the Departments and the certified IDR entity may request
additional information from either party to a dispute at any time,
including for the purpose of assessing whether a conflict of interest
exists, conducting an eligibility determination, or making a payment
determination. Under this proposal, a party must submit the requested
additional information within 5 business days to the Departments or the
selected certified IDR entity, as applicable, through the Federal IDR
portal. Following a request for additional information, under these
proposed rules, the time period for the applicable stage of the Federal
IDR process would be tolled until the earlier of the date either all of
the requested information is provided or the 5-business-day period
expires, and each subsequent timeframe in the Federal IDR process would
be determined based on the date of completion of the stage
[[Page 75780]]
of the Federal IDR process that was tolled for provision of the
requested information.
However, under the statute, the timeframe for parties making
payment after the payment determination cannot be extended. Therefore,
payments required as a result of a payment determination must be
provided within 30 calendar days of that payment determination. If a
party fails to submit the additional information as required, the
related determination, including the eligibility determination,
conflict-of-interest review, or payment determination will be made
without the requested information unless a good-cause extension of the
5-business-day period, as specified in 26 CFR 54.9816-8(g)(1)(i), 29
CFR 2590.716-8(g)(1)(i), and 45 CFR 149.510(g)(1)(i) has been provided,
and the party subsequently submits the additional information requested
within the extended period.
The Departments are of the view that a 5-business-day period is
sufficient for a response without unduly delaying the Federal IDR
process. This 5-business-day period is consistent with the 5-business-
day outreach period set forth in the August 2022 Technical Assistance
for Certified IDR Entities.\156\ The Departments anticipate that this
deadline would incentivize parties to submit information promptly, and
that tolling any applicable time periods would give the Departments and
certified IDR entities sufficient time to make such additional
information requests without encroaching on other timeframes.
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\156\ U.S. Department of Health and Human Services, U.S.
Department of Labor, and U.S. Department of the Treasury. (Oct.
2022) (Federal Independent Dispute Resolution (IDR) Process
Technical Assistance for Certified IDR Entities. August 2022,
available at: https://www.cms.gov/files/document/TA-certified-independent-dispute-resolution-entities-August-2022.pdf.
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The Departments seek comment on these proposals, including whether
certified IDR entities should still be required to make a payment
determination and provide notification of the payment determination to
the parties not later than 30 business days after the date of final
selection of the certified IDR entity, after a preceding timeframe in
the process has been tolled, such as for an eligibility determination.
d. Authority To Continue Negotiations or Withdraw
i. Authority To Continue To Negotiate
To correct an omission, HHS is proposing a non-substantive change
to 45 CFR 149.510(c)(3)(i) to add the term ``enrollee'' to references
to participants and beneficiaries. HHS is proposing to add the term
``enrollee'' to account for individuals who are enrolled in the
individual health insurance market when referencing whose cost sharing
must be considered as part of the total out-of-network rate agreed upon
by both parties and to clarify who may not be billed for additional
payments if the agreed upon out-of-network rate exceeds the QPA.
ii. Withdrawals
The Departments propose to add 26 CFR 54.9816-8(c)(3)(ii), 29 CFR
2590.716-8(c)(3)(ii), and 45 CFR 149.510(c)(3)(ii) to establish a
process for disputes to be withdrawn from the Federal IDR process.
Under these proposed rules, a dispute may be withdrawn from the Federal
IDR process by the initiating party, the Departments, or the certified
IDR entity before a payment determination is made if any one of the
following four conditions is met. Under the proposed new 26 CFR
54.9816-8(c)(3)(ii)(A), 29 CFR 2590.716-8(c)(3)(ii)(A), and 45 CFR
149.510(c)(3)(ii)(A), the first condition would allow for withdrawal
when the initiating party provides notification through the Federal IDR
portal to the Departments and the certified IDR entity (if selected)
that both parties to the dispute agree to withdraw the dispute from the
Federal IDR process without agreement on an out-of-network rate. An
initiating party generally should not be able to unilaterally withdraw
a dispute once it is initiated because the non-initiating party may not
wish to withdraw the dispute. Therefore, under these proposed rules,
the notification must include the dispute number, a statement about
both parties' agreement to withdraw and authorized signatures from both
parties. A withdrawal that is agreed to by both parties would remove
disputes from the system in the most efficient manner without the need
for additional outreach.
The Departments also propose to add 26 CFR 54.9816-8(c)(3)(ii)(B),
29 CFR 2590.716-8(c)(3)(ii)(B), and 45 CFR149.510(c)(3)(ii)(B), to
allow for withdrawal when the initiating party provides a standard
withdrawal request notice through the Federal IDR portal to the
Departments, the certified IDR entity (if selected), and the non-
initiating party of its request to withdraw the dispute from the
Federal IDR process, and the non-initiating party notifies the
Departments, certified IDR entity (if selected), and the initiating
party through the Federal IDR portal of its agreement to withdraw from
the Federal IDR process within 5 business days of the initiating
party's request. If the non-initiating party fails to respond within 5
business days of the initiating party's request, the non-initiating
party would be considered to have agreed to the withdrawal, and the
dispute would be withdrawn. The Departments propose adding withdrawal
of a dispute in this situation to address circumstances in which the
non-initiating party fails to respond because they are not engaging in
the process. Permitting withdrawal of a dispute in such cases would
decrease the number of payment determinations the certified IDR entity
is required to adjudicate. These proposals strike a balance between
fairness to the disputing parties and efficiency of the Federal IDR
process by generally requiring mutual agreement by the disputing
parties to withdraw the dispute but providing that the dispute would be
withdrawn in the event the non-initiating party is nonresponsive within
the specified timeframe.
Under proposed new 26 CFR 54.9816-8(c)(3)(ii)(C), 29 CFR 2590.716-
8(c)(3)(ii)(C), and 45 CFR 149.510(c)(3)(ii)(C), the third condition
under which a dispute may be withdrawn is when a certified IDR entity
or the Departments cannot determine eligibility because both parties
are unresponsive to a request for additional information as described
in proposed 26 CFR 54.9816-8(c)(2)(iii), 29 CFR 2590.716-8(c)(2)(iii)
and 45 CFR 149.510(c)(2)(iii). In situations where neither party
responds to the requested information, the Departments believe it
appropriate for the dispute to be withdrawn because the certified IDR
entity lacks the appropriate information to make the required
eligibility determination properly and the parties are failing to
engage in the process.
Under proposed new 26 CFR 54.9816-8(c)(3)(ii)(D), 29 CFR 2590.716-
8(c)(3)(ii)(D), and 45 CFR 149.510(c)(3)(ii)(D), the fourth condition
under which a dispute may be withdrawn is when the certified IDR entity
cannot make a payment determination because both parties have failed to
submit an offer as described in proposed 26 CFR 54.9816-8(c)(5)(i), 29
CFR 2590.716-8(c)(5)(i) and 45 CFR 149.510(c)(5)(i). The Departments
are of the view that such disputes should be withdrawn from the Federal
IDR process because under the statute, parties have ceased to
participate in the Federal IDR process and failed to submit an offer
that the certified IDR entity must select as the out-of-network payment
amount. In addition, if neither party has submitted an offer, there is
nothing from
[[Page 75781]]
which the certified IDR entity may select.\157\
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\157\ Section 9816(c)(5)(A)(i) of the Code, section
716(c)(5)(A)(i) of ERISA, and section 2799A-1(c)(5)(A)(i) of the PHS
Act.
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In addition to the proposals described in this section of the
preamble, the Departments also propose technical revisions to the
existing requirements for the authority to continue negotiations, which
are currently set forth at 26 CFR 54.9816-8T(c)(2), 29 CFR 2590.716-
8(c)(2), and 45 CFR 149.510(c)(2). These proposed rules would
redesignate paragraph (c)(2) as (c)(3) and amend the title at current
paragraph (c)(2) by adding to the end of it ``or withdraw''.
The Departments seek comment on these proposals, including if there
are other circumstances for which the Departments should consider a
dispute withdrawn.
2. Treatment of Batched Items and Services and Bundled Payment
Arrangements
The Departments propose revisions to the requirements for the
treatment of batched items and services which are currently set forth
at 26 CFR 54.9816-8T(c)(3)(i), 29 CFR 2590.716-8(c)(3)(i), and 45 CFR
149.510(c)(3)(i). However, as discussed in section I.D. of this
preamble, the requirements at 26 CFR 54.9816-8T(c)(3)(i)(C), 29 CFR
2590.716-8(c)(3)(i)(C), and 45 CFR 149.510(c)(3)(i)(C) have been
vacated by the District Court in TMA IV order. The Departments also
propose technical changes to the treatment of bundled payment
arrangements, currently set forth at 26 CFR 54.9816-8T(c)(3)(ii), 29
CFR 2590.716-8(c)(3)(ii), and 45 CFR 149.510(c)(3)(ii). The batching
and bundling payment proposals are informed by the Departments'
experience implementing the regulatory requirements on the batching of
items and services related to the treatment of a similar condition and
relevant feedback from interested parties, including comments submitted
in response to the October 2021 interim final rules.
a. Treatment of Batched Items and Services and Bundled Payment
Arrangements Under Current and Vacated Rules
Under the October 2021 interim final rules, multiple qualified IDR
items and services were required to meet four conditions to be batched
and considered as part of a single payment determination. First, the
qualified IDR items and services must be billed by the same provider or
group of providers, the same facility, or same provider of air
ambulance services, which means the items and services must be billed
under the same NPI or TIN.
Second, the initial payment (or notice of denial of payment) for
the items and services must be made by the same group health plan or
health insurance issuer. The Departments clarified in August 2022
Technical Assistance for Certified IDR Entities that qualified IDR
items or services can be batched if payment is made by the same issuer
even if the qualified IDR items and services relate to claims from
different fully-insured group or individual health plan coverage
offered by the issuer; and that for self-insured group health plans,
qualified IDR items or services can be batched only if payment is made
by the same plan, even if the same TPA administers multiple self-
insured plans.
Third, the October 2021 interim final rules established that
qualified IDR items and services were related to the treatment of a
similar condition if the qualified IDR items and services were the same
or similar items or services, meaning that those items and services are
billed under the same service code with modifiers (if applicable), or
billed under a comparable service code with modifiers (if applicable)
under a different procedural code system.\158\ However, as discussed in
section I.D. of this preamble, on August 3, 2023, the District Court
vacated this provision on the grounds that it violated the notice-and-
comment requirement of the Administrative Procedure Act. The TMA IV
order vacated the parts of the August 2022 Technical Assistance for
Certified IDR Entities that stated that multiple qualified IDR items or
services may be batched in a single dispute if the qualified IDR items
or services were billed under the same service code with modifiers, or
billed under comparable codes with modifiers under different procedural
code systems. Further, as discussed in section I.D. of this preamble,
on August 24, 2023, the District Court vacated that portion of the
August 2022 Technical Assistance for Certified IDR Entities on the
basis that the guidance prohibits a single air ambulance transport,
which is billed under two service codes (one for the base rate and one
for the mileage rate), to be submitted as a single dispute, and instead
required two separate disputes to be submitted. The District Court
vacated this provision as a violation of the statute which defines each
air ambulance transport as a single service.\159\
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\158\ In the July 2021 interim final rule (86 FR 36890), the
Departments defined the service code as the code that describes an
item or service using the Current Procedural Terminology (CPT),
Healthcare Common Procedure Coding System (HCPCS), and the
Diagnosis-Related Group (DRG) codes. See also 26 CFR 54.9816-
6T(a)(14), 29 CFR 2590.716-6(a)(14), and 45 CFR 149.140(a)(14).
\159\ 42 U.S.C. 300gg-112(b)(1)(B), (c)(1).
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Fourth, all the qualified IDR items and services must have been
furnished within the same 30-business-day period or the 90-calendar-day
suspension period (also referred to as the ``cooling-off period'')
under 26 CFR 54.9816-8T(c)(5)(vii)(B), 29 CFR 2590.716-8(c)(5)(vii)(B),
and 45 CFR 149.510(c)(5)(vii)(B).\160\ As stated in the preamble to the
October 2021 interim final rules, for claims for an item or service for
which the end of the open negotiation period occurs during the 90-
calendar-day suspension period, after the end of the 90-calendar-day
suspension period, either party may initiate the Federal IDR process
for any item or service affected by the suspension. For these items or
services, the initiating party must submit the notice of IDR initiation
within 30 business days following the end of the 90-calendar-day
suspension period, as opposed to the standard 4-business-day period
following the end of the open negotiation period. The 30-business-day
period begins on the day after the last day of the 90-calendar-day
suspension period.
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\160\ The Departments propose a non-substantive amendment to 26
CFR 54.9816-8(c)(4)(i)(D), 29 CFR 2590.716-8(c)(4)(i)(D), and 45 CFR
149.510(c)(4)(i)(D) to correct the cross-reference to the cooling-
off period from 26 CFR 54.9816-8T(c)(4)(vi)(B), 29 CFR 2590.716-
8(c)(4)(vi)(B), and 45 CFR 149.510(c)(4)(vi)(B) to 26 CFR 54.9816-
8T(c)(5)(vii)(B), 29 CFR 2590.716-8(c)(5)(vii)(B), and 45 CFR
149.510(c)(5)(vii)(B).
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Section 9816(c)(3)(B) of the Code, section 716(c)(3)(B) of ERISA,
and section 2799A-1(c)(3)(B) of the PHS Act direct the Departments, as
part of specifying criteria for batched disputes, to provide that
qualified IDR items and services included by a provider or facility as
part of a bundled payment may be part of a single determination. The
October 2021 interim final rules specify that items and services may be
submitted as a bundled payment arrangement when qualified IDR items and
services are billed by a provider, facility, or provider of air
ambulance services as part of a bundled payment arrangement, or where a
plan or issuer makes or denies an initial payment as a bundled payment.
The August 2022 Technical Assistance for Certified IDR Entities
clarified that for the purposes of the Federal IDR process, a bundled
arrangement is an arrangement under which: (1) a provider, facility, or
provider of air ambulance services bills
[[Page 75782]]
for multiple items or services under a single service code; or (2) a
plan or issuer makes an initial payment or notice of denial of payment
to a provider, facility, or provider of air ambulance services under a
single service code that represents multiple items or services (for
example, a DRG).\161\ The Departments also specified that bundled
payment arrangements submitted under 26 CFR 54.9816-8T(c)(3)(ii), 29
CFR 2590.716-8(c)(3)(ii), and 45 CFR 149.510(c)(3)(ii) are subject to
the rules for batched determinations and the certified IDR entity fee
for single determinations.
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\161\ U.S. Department of Health and Human Services, U.S.
Department of Labor, and U.S. Department of the Treasury. (August
2022). Technical Assistance for Certified IDR Entities. https://www.cms.gov/files/document/TA-certified-independent-dispute-resolution-entities-August-2022.pdf.
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b. Feedback From Interested Parties on Current Batching Rules
Since the publication of the October 2021 interim final rules, the
Departments have reviewed comments in response to the rules and
continue to engage interested parties to identify opportunities for
improvements in the Federal IDR process. In particular, the Departments
have received substantial feedback from interested parties on the
batching criteria that specifies how multiple qualified IDR items or
services that relate to the treatment of a similar condition may be
batched. Specifically, some providers of air ambulance services have
expressed that the now-vacated batching rule finalized in the October
2021 interim final rules was burdensome because it prohibited a single
air ambulance transport service from being the subject of a single
dispute (for example, charges for fuel and mileage are two separate
codes and could not be batched under the vacated batching rule). They
highlighted that this essentially doubled their costs to dispute an
out-of-network payment through the Federal IDR process. Some
radiologists asserted that the vacated batching rule prohibited them
from batching radiology items and services for multiple body parts for
a single patient (for example, lumbar and thoracic spine) because these
items and services are billed under different service codes, even
though they may relate to a similar condition. They further asserted
that, absent the ability to batch, radiologists are effectively denied
access to the Federal IDR process because the reimbursements for most
individual radiology codes are low-dollar and therefore are not cost-
effective to dispute individually. The Departments received similar
feedback from other specialty providers, including laboratory and
pathology physicians. Emergency physicians have stated that the nature
of emergency care makes it difficult for them to batch claims under the
vacated batching rule. For example, emergency physicians note that
emergency care is characterized by a range of severity that patients
present with, and a corresponding range of diagnostic, therapeutic, and
decision-making intensity, which is different from scheduled surgery or
office visits where the patient's diagnosis or condition is most often
explicitly known. For this reason, emergency physicians recommend that
for the purpose of emergency physicians, the ``condition'' should be
defined as ``emergency medical care'' or ``EMTALA-related care'' \162\
and that limiting batching to individual ``conditions'' would result in
a high number of disputes in the Federal IDR process, expense, and
administrative burden.
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\162\ An emergency medical condition is defined in the Emergency
Medical Treatment and Active Labor Act (EMTALA) in part as: ``a
medical condition manifesting itself by acute symptoms of sufficient
severity (including severe pain) such that the absence of immediate
medical attention could reasonably be expected to result in placing
the individual's health [or the health of an unborn child] in
serious jeopardy, serious impairment to bodily functions, or serious
dysfunction of bodily organs.'' 42 U.S.C. 1395dd(e)(1).
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Anesthesiologists have recommended two different mechanisms by
which claims for services should be able to be batched. First,
anesthesiologists have stated that anesthesia services should be
batched based on anesthesia code families. Anesthesia services are
classified in a distinct code set in which CPT codes are grouped
according to body parts (for example, head, neck, thorax, etc.).
Anesthesiologists have highlighted that if they are not permitted to
batch claims for services within a related body-part code group, they
will be confronted with unique and significant administrative burdens
in the Federal IDR process. Second, anesthesiologists have raised that
they should be able to batch all claims with the same anesthesia
conversion factor because this reflects industry practice. The
conversion factor is the basis for their negotiations with payers for
in-network services; a payer generally contracts with an
anesthesiologist or their group for payment for the full range of
anesthesia services based upon a single, common anesthesia conversion
factor (expressed in dollars per unit). Whether the anesthesia service
is for a surgical procedure on the head, shoulder, arm, or leg, the
anesthesia conversion factor for each service is the same \163\ and the
assigned base units vary based on the procedure and the time units vary
as determined by actual time.
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\163\ In the August 2022 Technical Assistance for Certified IDR
Entities, the Departments noted that plans and issuers generally
calculate payment amounts for anesthesia services by multiplying the
rate for the anesthesia conversion factor by (1) the base unit for
the anesthesia service code, (2) the time unit, and (3) the physical
status modifier unit. The base unit, time unit, and physical status
modifier unit are specific to the individual receiving the
anesthesia services. These base units are assigned to the services
codes for anesthesia services, specifically CPT codes 00100 to
01999.
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The Departments also have received feedback from certified IDR
entities regarding the batching rules and potential impacts of
expanding batching. Certified IDR entities have indicated that disputes
involving batched items and services under the current and now-vacated
rules are more administratively burdensome than non-batched disputes,
often due to the extra time and resources they must expend in verifying
that the items and services are properly batched and eligible for the
Federal IDR process. Further, certified IDR entities have stated that a
substantial portion of the time and expense related to resolving
disputes is spent on these administrative and eligibility-related
tasks; and once the dispute reaches the certified IDR entities, they
are able to make the substantive payment determinations relatively
efficiently. However, in providing feedback to the Departments on ways
to improve batching in the Federal IDR process, certified IDR entities
signaled that processing batched disputes would become substantially
more difficult if broad categories of items and services could be
submitted to the Federal IDR process in a single batched dispute. This
is because, in addition to adding further complexity to the eligibility
review process, certified IDR entities would also need to closely
review the potentially unique factual circumstances of each item and
service contained within the batch in making the payment determination.
This could include differing evidence of the additional circumstances
described in section 9816(c)(5)(C) of the Code, section 716(c)(5)(C) of
ERISA, and section 2799A-1(c)(5)(C) of the PHS Act for each batched
item and service.
Certified IDR entities recommended implementing a cap on the number
of qualified IDR items and services (or ``line items'') included in
batched disputes in order to ensure that they can resolve payment
determinations within the 30-business-day requirement. Specifically,
many certified IDR entities
[[Page 75783]]
suggested imposing a 25-line-item cap on the number of items and
services that could be submitted in a batched dispute, to the extent
factual circumstances among them differed. Some certified IDR entities
mentioned that the necessary line-item cap would depend on how the
parties would be permitted to batch items and services; however,
certified IDR entities generally indicated that in any circumstance, it
would not be feasible to resolve disputes in excess of 100 items and
services within the 30-business-day period for making payment
determinations. Certified IDR entities indicated they could manage
batched claims containing a larger number of items and services (for
example, 25 to 50) to the extent they involved the same type of claim
and when the relevant facts are identical across the items or services
in the batch. For example, some certified IDR entities stated that
batching items and services from a single patient encounter and claim
would be manageable and create efficiencies. However, certified IDR
entities maintained that once the line items included in a batch reach
a certain number, efficiencies are lost, and the batched dispute
becomes unmanageable.
Plans and issuers have also indicated that the relatively frequent
submission of incorrectly batched items and services as a single
dispute by providers and facilities poses a substantial administrative
burden for them. This is because the initiating party may need to
resubmit the dispute, which, under the current rules, could also result
in the non-initiating party paying the applicable administrative fee,
potentially multiple times. Such interested parties urged the
Departments to avoid adding further complexity or ambiguity with
respect to the ability to batch items and services.
c. Proposals To Improve Batching in the Federal IDR Process
After considering comments and feedback from interested parties
(including certified IDR entities, plans and issuers, providers,
facilities, and providers of air ambulance services), and the
Departments' general experience with operationalizing the Federal IDR
process to date, the Departments are of the view that, under some
circumstances, allowing multiple qualified IDR items and services that
treat a similar condition to be batched together in a single payment
determination proceeding, in accordance with the requirements of 26 CFR
54.9816-8T(c)(3)(i), 29 CFR 2590.716-8(c)(3)(i), and 45 CFR
149.510(c)(3)(i), encourages efficiency and can result in cost savings
for disputing parties.\164\
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\164\ Section 9816(c)(3)(A)(iv) of the Code, section
716(c)(3)(A)(iv) of ERISA, and section 2799A-1(c)(3)(A)(iv) of the
PHS Act.
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In these proposed rules, the Departments are proposing new batching
provisions that are intended to achieve a balance among several
important objectives, including ensuring the batching rules do not
unreasonably impede parties' access to the Federal IDR process
considering relative costs and administrative burden, and simplifying
Federal IDR process operations while avoiding new operational
complexities that could create or exacerbate dispute backlogs. The
Departments are of the view that the proposed provisions would help
ensure that qualified IDR items and services included in batched
determinations have clear definitional principles that would yield
logical payment determinations across certified IDR entities, including
determinations of whether items or services are properly submitted as
batched determinations. The Departments are also of the view that these
proposals would reduce potential risk that large and complicated
batches would extend the time needed for certified IDR entities to make
eligibility and payment determinations.\165\ In addition to these
proposals, the Departments are considering altering current guidance on
the resubmission of incorrectly batched disputes. In the August 2022
Technical Assistance for Certified IDR Entities, the Departments stated
that inappropriately batched or bundled disputes may be re-submitted as
properly batched or single disputes if the qualified IDR items and
services that are subject to the disputes meet all other applicable
requirements, including requirements for timely initiation of the
Federal IDR process. The Departments are considering removing this
flexibility 90 business days after the proposed batching provisions, as
finalized, would become applicable. This would allow parties time to
adjust to the new proposed batching rules, if finalized.
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\165\ Under this notice of proposed rulemaking, the Departments
propose new requirements related to the treatment of batched items
and services and bundled payment arrangements. While the Departments
consider and discuss feedback from interested parties in the context
of these new proposals, they do not specifically address all public
comments on batching and bundling received in response to the
October 2021 interim final rule.
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i. Treatment of Batched Items and Services
The Departments first propose to redesignate paragraph (c)(3) as
paragraph (c)(4) under 26 CFR 54.9816-8, 29 CFR 2590.716-8, and 45 CFR
149.510. Newly redesignated paragraph (c)(4)(i) of these sections would
provide that up to 25 qualified IDR items and services may be batched
and considered jointly as part of one payment determination only if all
requirements under paragraphs (c)(4)(i)(A) through (D) are met.
A. Line-Item Limit for Batched Items and Services
The Departments propose to limit batched determinations to 25 line
items in a single dispute. Without such a limit, the additional
batching provisions in these proposed rules could increase the time and
level of effort certified IDR entities spend on resolving payment
determinations, which, in turn, would hinder their ability to make
timely payment determinations. The Departments must ensure that the
Federal IDR process operates efficiently, as section 9816(c)(3)(A) of
the Code, section 716(c)(3)(A) of ERISA, and section 2799A-1(c)(3)(A)
of the PHS Act direct the Departments to ``specify criteria under which
multiple qualified IDR dispute items and services are permitted to be
considered jointly as part of a single determination by an entity for
purposes of encouraging the efficiency (including minimizing costs) of
the IDR process.'' The Departments, therefore, and in line with the
feedback from certified IDR entities discussed in section II.E.2.b of
the preamble, propose a 25-line-item limit as a reasonable cap to
ensure that large and complicated batches do not extend the timeframe
needed for certified IDR entities to make eligibility and payment
determinations. Further, a 25-line-item limit is intended to help
ensure that certified IDR entities are able to reasonably forecast and
cover their costs through the fees they set for batched disputes and to
process batched disputes in a more timely manner.
The Departments seek comment on the proposed limit on the number of
qualified IDR items and services in a batched determination and whether
an alternative line-item limit that is higher or lower than 25 line
items would be more appropriate to promote efficiencies and cost
savings in the Federal IDR process. The Departments are considering
whether a 50-line-item limit is a more reasonable cap to encourage
efficiencies for disputing parties, while still allowing certified IDR
entities sufficient time to review the
[[Page 75784]]
eligibility of batched disputes and make payment determinations within
the 30-business-day requirement. The Departments also solicit comment
on whether the line-item limit should vary depending on the type of
batched dispute. For example, there could be a 25-line-item limit for
items and services furnished to a single patient on the same or
consecutive dates of service and billed on the same claim, and a 50-
line-item limit for items and services furnished to one or more
patients under the same service code.
The Departments also seek comment on whether a line-item limit
should be imposed and whether and how such a provision could increase
efficiency and process disputes in a more timely manner. The
Departments also solicit comment on whether the certified IDR entity
fee structure for batched determinations should be adjusted given the
proposed changes to the batching rules.
B. Batched Items and Services Must Be Billed by the Same Provider,
Facility, or Provider of Air Ambulance Services
The Departments propose to redesignate 26 CFR 54.9816-
8(c)(3)(i)(A), 29 CFR 2590.716-8(c)(3)(i)(A), and 45 CFR
149.510(c)(3)(i)(A) as 26 CFR 54.9816-8(c)(4)(i)(A), 29 CFR 2590.716-
8(c)(4)(i)(A), and 45 CFR 149.510(c)(4)(i)(A), respectively. The
Departments propose no substantive changes to this provision, which
provides that qualified IDR items and services may be considered as
part of a single batched determination only where they were billed by
the same provider or group of providers, the same facility, or the same
provider of air ambulance services. The provision also provides that
qualified IDR items and services are billed by the same provider or
group of providers, the same facility, or the same provider of air
ambulance services if the items or services are billed with the same
NPI or TIN. This provision reflects the first of four statutory
requirements that must be satisfied for a qualified IDR item or service
to be considered as part of a batched determination.\166\
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\166\ Section 9816(c)(3)(A) of the Code, section 716(c)(3)(A) of
ERISA, and section 2799A-1(c)(3)(A) of the PHS Act.
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C. Batched Items and Services Must Be Paid by the Same Plan or Issuer
Under proposed 26 CFR 54.9816-8(c)(4)(i)(B), 29 CFR 2590.716-
8(c)(4)(i)(B), and 45 CFR 149.510(c)(4)(i)(B), the Departments propose
that qualified IDR items and services may be batched and considered
jointly as part of one payment determination if payment for the
qualified IDR items and services is made by the same group health plan
or health insurance issuer. Because the Departments have received
questions about how to batch for claims involving group health plans
that are fully-insured versus self-insured, the proposed rules specify
that this requirement would be satisfied if the same issuer is required
to make payment for the qualified IDR items and services, even if the
qualified IDR items and services relate to claims from different group
health plans or individual market policies. For self-insured group
health plans, this requirement would be satisfied if the same self-
insured group health plan is required to make payment for the qualified
IDR items and services, including when the plan makes payments through
a TPA: the requirement would not be satisfied if multiple self-insured
group health plans are required to make payments for the qualified IDR
items and services, even if those group health plans make payments
through the same third party administrator. While a given TPA may
administer multiple self-insured plans, the self-insured group health
plan generally is the responsible party for payment or reimbursement of
the qualified IDR items and services.
D. Batched Items and Services Must Be Related to the Treatment of a
Similar Condition
The Departments propose to add 26 CFR 54.9816-8(c)(4)(i)(C), 29 CFR
2590.716-8(c)(4)(i)(C), and 45 CFR 149.510(c)(4)(i)(C) to permit
initiating parties to batch qualified IDR items and services in
specific circumstances, so long as the items and services relate to the
treatment of a similar condition and the batching of the items and
services would encourage efficiency (including minimizing costs) in the
Federal IDR process. As the Departments explained earlier in section
II.E.2. of this preamble, the Departments are proposing new batching
criteria for multiple qualified IDR items and services that relate to
the treatment of a similar condition in an effort to ensure the Federal
IDR process is efficient and economically feasible for providers,
facilities, providers of air ambulance services, plans, and issuers.
The Departments must also ensure that the Federal IDR process operates
efficiently, as section 9816(c)(3)(A) of the Code, section 716(c)(3)(A)
of ERISA, and section 2799A-1(c)(3)(A) of the PHS Act directs the
Departments to ``specify criteria under which multiple qualified IDR
dispute items and services are permitted to be considered jointly as
part of a single determination by an entity for purposes of encouraging
the efficiency (including minimizing costs) of the IDR process.''
However, there is a threshold number of items and services in a single
batch at which that batch becomes so large that no efficiencies are
gained, and an additional burden is imposed on the certified IDR
entity, as discussed in section II.E.2.i.A. of this preamble (regarding
line-item limits). Therefore, the Departments do not intend for the
additional flexibility proposed under these rules to be unlimited or
available in circumstances that would not promote efficiency in the
Federal IDR process. The Departments propose four circumstances under
which qualified IDR items and services would be considered to relate to
the treatment of a similar condition such that a certified IDR entity's
consideration of the items and services in a single payment
determination would promote efficiency in the Federal IDR process.
Under new 26 CFR 54.9816-8(c)(4)(i)(C)(1), 29 CFR 2590.716-
8(c)(4)(i)(C)(1), and 45 CFR 149.510(c)(4)(i)(C)(1), the Departments
propose that qualified IDR items and services would be considered to
relate to the treatment of a similar condition and encourage efficiency
in the Federal IDR process when they were furnished to a single patient
during the same patient encounter. For purposes of these proposed
regulations, the Departments propose to define a single patient
encounter as a patient encounter on one or more consecutive days during
which the qualified IDR items or services were furnished to the same
patient and billed on the same claim form.
The Departments understand from engagement with providers, medical
coding professionals, and certified IDR entities that while there may
be some instances where a patient is treated for two or more unrelated
or dissimilar conditions during a single patient encounter, in general,
items and services furnished during a patient encounter and billed by
the same provider, facility, or provider of air ambulance services on
one claim form tend to relate to the treatment of the same or similar
condition. The Departments are of the view that the proposed definition
of a single patient encounter would promote efficiency by avoiding the
requirement that an initiating party file separate disputes to obtain
payment determinations for each of the items and services that were
part of a single claim and patient encounter.
Allowing qualified IDR items or services to be included in a
batched
[[Page 75785]]
determination when they were furnished to the same patient on one or
more consecutive days and billed on the same claim form would simplify
and encourage efficiency of the Federal IDR process. For example,
evidence of the additional circumstances described in section
9816(c)(5)(C) of the Code, section 716(c)(5)(C) of ERISA, and section
2799A-1(c)(5)(C) of the PHS Act would generally be identical for each
qualified IDR item and service furnished during a single patient
encounter. This would limit the burden on certified IDR entities
considering such additional circumstances and making a payment
determination for the batch. In addition, permitting batching of items
and services furnished to a single patient during the same patient
encounter would help the non-initiating party more readily identify the
claims involved since the dispute submitted by the initiating party to
the Federal IDR process would relate to a single claim form in the non-
initiating party's records, as opposed to having to locate and review
multiple claim forms.
The Departments note that the proposed requirement to permit
batching by patient encounter would increase procedural efficiency
compared to the vacated batching provision for providers of air
ambulance services by allowing them to submit a single dispute for a
patient's air ambulance transport (provided the other batching
requirements are met). This approach is consistent with the TMA III
order and opinion, which vacated provisions of the August 2022
Technical Assistance for Certified IDR Entities that in effect required
each air ambulance service code to be submitted as a single dispute,
requiring two separate IDR disputes for a single air ambulance
transport. Under these proposed rules, mileage and base rates, as well
as any other item or service furnished during a single air transport
and billed for on the same claim form, could be batched in a single
payment determination. The Departments request comment on this
proposal, including any data or other information that supports or
contradicts the Departments' understanding underlying this proposal.
At new 26 CFR 54.9816-8(c)(4)(i)(C)(2), 29 CFR 2590.716-
8(c)(4)(i)(C)(2), and 45 CFR 149.510(c)(4)(i)(C)(2), the Departments
would reestablish the provision that qualified IDR items and services
also would be considered to relate to the treatment of a similar
condition and encourage efficiency when they were furnished to one or
more patients during different patient encounters and were billed under
the same service code or a comparable code under a different procedural
code system, such as CPT codes with modifiers, if applicable,
Healthcare Common Procedure Coding System (HCPCS) with modifiers, if
applicable, or DRG codes with modifiers, if applicable. As discussed in
section I.D. of this preamble, in TMA IV, the District Court's decision
vacated this previously established provision only on the grounds that
it violated the notice-and-comment requirement under the Administrative
Procedure Act and did not address whether this criterion is a
reasonable interpretation of the No Surprises Act.
Qualified IDR items or services billed under the same code or under
comparable codes of different coding systems would be considered to
generally relate to treatment of a similar condition because they
essentially would be the same item or service. For example, CPT code
93000 and HCPCS code G0403 both correspond to a routine
electrocardiogram (with 12 leads). The proposal would simplify and
encourage the efficiency of the Federal IDR process by retaining a
clearly defined methodology for disputing parties and certified IDR
entities to determine whether qualified IDR items and services are
appropriately batched, which would contribute to the efficiency and
consistency of such determinations across certified IDR entities.
However, the Departments request comment on whether there are
circumstances in which a single provider, facility, or provider of air
ambulance services--as a practical matter--would bill for the same
qualified IDR item or service using different code sets or whether the
proposed flexibility could potentially incentivize billing practices
specifically intended to circumvent these batching rules or other
requirements of the Federal IDR process. The Departments request
comment on this proposal, including any data or other information that
supports or contradicts the Departments' understanding underlying this
proposal.
Some interested parties have suggested that the Departments should
deem all qualified IDR items and services within the same major CPT
Category I codes or ``family'' to relate to the treatment of similar
conditions. These sub-categories include Evaluation and Management,
Anesthesia, Surgery, Radiology/Diagnostic Radiology/Diagnostic
Ultrasound, Pathology and Laboratory/Proprietary Laboratory Analysis,
and Medicine. The Departments seek to balance the breadth of the
interpretation of the statutory requirement that batched items and
services relate to the treatment of a ``similar condition'' with the
goal of efficiency. The Departments have heard from certified IDR
entities that significant variability among items or services in a
batched claim often leads to payment determinations that are
significantly more time-intensive and burdensome to review than claims
for items and services that are significantly similar. Efficiency in
making eligibility and payment determinations is affected by several
factors including the payer, the provider, the circumstances of each
patient's treatment, and the QPA for the items and services under
dispute. Grouping larger numbers of items and services together into a
single batch can lower costs to the extent that it minimizes effort on
the part of the certified IDR entity in evaluating factors related to
the dispute or disputing parties, such as eligibility for the Federal
IDR process. However, larger batches of services with greater
variability can also increase review time and costs of certified IDR
entities, because larger batches that include disparate services and
patient circumstances associated with different supporting information
submitted by disputing parties, require certified IDR entities to
analyze more information, often taking longer to review. For example,
if the Departments permitted batching across the entirety of the
Category I CPT code subcategory for radiology, an individual dispute
could contain an X-ray of the eye for detection of a foreign body (CPT
code 70030), a bilateral screening mammography (CPT code 77067), and
simple intensity modulated radiation treatment (IMRT) delivery (CPT
code 77385). These services would have different circumstances for the
treatment of the patient and would result in the certified IDR entity
evaluating a unique set of factors and supporting documentation for
each of these services, thus reducing the ability of the certified IDR
entity to make timely payment determinations for such disputes.
The Departments are of the view that the variability of the
conditions represented within the CPT Category I sub-categories would
reduce, rather than promote greater efficiency of the Federal IDR
process and would be less likely to relate to the treatment of a
similar condition. Thus, the Departments propose to specify in guidance
ranges of CPT codes within sub-categories of CPT Category I codes that
may be batched, in order to promote efficiency in the Federal IDR
process. Specifically, the Departments propose at 26 CFR 54.9816-
[[Page 75786]]
8(c)(4)(i)(C)(3), 29 CFR 2590.716-8(c)(4)(i)(C)(3), and 45 CFR
149.510(c)(4)(i)(C)(3) that for anesthesiology, radiology, pathology,
and laboratory qualified IDR items and services, items and services
would be considered to relate to the treatment of similar conditions
when they are furnished to one or more patients and were billed under
service codes belonging to the same Category I CPT code ranges, which
would be specified in guidance published by the Departments.
The Departments propose to divide Category I CPT codes into ranges
based on the Departments' characterization of those codes as being
related to the treatment of a similar condition. In Tables 2 through 4,
the Departments detail proposed ranges of Category I CPT sub-categories
for anesthesiology, radiology, pathology, and laboratory items or
services that an initiating party may batch together within a single
dispute (provided the other batching requirements are met). Under this
proposal, the Departments would permit batching only of codes within
these ranges for anesthesiology, radiology, pathology, and laboratory
qualified IDR items and services. By allowing for the more narrowly
defined Category I CPT code spans for batched determinations indicated
in Tables 2 through 4, the Departments could increase the probability
that the items or services in a dispute both relate to the treatment of
a similar condition and increase the efficiency of the Federal IDR
process, since the associated items or services would share the
clinical commonality of pertaining to patients who require diagnostic
imaging, radiation oncology, similar laboratory tests, etc.
If these proposed rules are finalized, the Departments would
establish descriptions of each sub-category of CPT codes, and update
periodically as necessary the allowable ranges of service codes
belonging to the same CPT sub-category for purposes of batching under
proposed 26 CFR 54.9816-8(c)(4)(i)(C)(3), 29 CFR 2590.716-
8(c)(4)(i)(C)(3), and 45 CFR 149.510(c)(4)(i)(C)(3) in guidance. CPT
codes are defined in the American Medical Association's (AMA's) ``CPT
Manual,'' which is updated and published annually. The AMA releases the
CPT manual in the fall of each year to precede their January 1st
effective date. The Departments would review the modifications made to
the CPT manual once available and determine if the modifications
necessitate updates to the Category I CPT code spans for batched
determinations based on the Departments' interpretation of the pre-
existing descriptive categories with which a new Category I CPT code
most closely aligns. For example, if a new CPT manual established a new
Category I CPT code for diagnostic radiology (imaging) that would fall
outside of CPT code spans 70010-71555, the Departments would need to
release updated guidance for batched determinations to advise parties
of which pre-existing descriptive categories of CPT code spans most
closely align with the new code, and, thus, with which it can be
batched. In such circumstances, the Category I CPT code spans for
batched determinations most recently established by the Departments
would stand until the publication of further guidance.
BILLING CODE 6325-63-P; 4830-01-P; 4510-29-P; 4120-01-P;
[[Page 75787]]
[GRAPHIC] [TIFF OMITTED] TP03NO23.005
[[Page 75788]]
[GRAPHIC] [TIFF OMITTED] TP03NO23.006
[[Page 75789]]
[GRAPHIC] [TIFF OMITTED] TP03NO23.007
BILLING CODE 6325-63-C; 4830-01-C; 4510-29-C; 4120-01-C;
Another goal of this proposal is to ensure that the batching rules
facilitate access to the Federal IDR process considering the relative
costs and administrative burden associated with participating.
Consistent with feedback from interested parties, this proposal would
also allow providers of lower-dollar qualified IDR items and services,
such as providers of radiology, pathology, and laboratory items or
services, to batch more services than was permitted under the October
2021 interim final rules, because such qualified IDR items and services
may not be cost-effective to dispute individually.
As discussed earlier in section II.E.2.c of this preamble, the
Departments are proposing new batching provisions to ensure the
batching rules do not unreasonably impede the parties' access to the
Federal IDR process considering relative costs and administrative
burden. The Departments intend these provisions to improve the
efficiency of the Federal IDR process while avoiding new operational
complexities that could create or exacerbate dispute backlogs. The
proposed rule would provide new flexibility in two ways: first, it
would allow initiating parties to batch all items and services related
to a single patient encounter; second, it would allow batching of
certain items and services within the same Category I CPT code sub-
sections. For the purposes of this proposal, the Departments are
primarily focusing on provider specialties that have been involved in a
majority of disputes under the Federal IDR process, with one exception
(emergency medicine, discussed in further detail below). The
Departments solicit comment on whether there are other Category I CPT
code subsections (for example, Medicine and Surgery) that would satisfy
the statutory requirements that batched items and services relate to
the treatment of a similar condition and encourage efficiency of the
Federal IDR process. Although batching of items and services within the
same Category I CPT code subsection is not available for all medical
specialties, the Departments are of the view that the proposed batching
provisions that would allow batching for a single patient encounter
would improve efficiency of the Federal IDR process for medical,
surgical, and emergency providers.
As discussed in section II.E.2.b. of this preamble, emergency
providers have recommended that the Departments permit batching of the
most common evaluation and management CPT codes (99281-99285) for items
and services furnished in emergency departments. After considering this
feedback, the Departments are concerned that the variability of the
conditions that are represented across the emergency medicine
evaluation and management CPT codes would increase the likelihood for
dissimilar conditions and patient acuities to be batched, which would
be inefficient and highly burdensome for certified IDR entities. For
instance, if these five different emergency medicine evaluation and
management codes could be batched together, the conditions represented
in
[[Page 75790]]
one batched dispute could include such diverse situations as a patient
evaluated for an insect bite and one patient treated for a heart
attack. The Departments seek comment on whether there are ways to
provide additional batching flexibility for emergency department
services in a way that mitigates the Departments' concerns that such
flexibility would increase the likelihood that claims for treatment of
dissimilar conditions would be batched and promotes the efficiency of
the IDR process, for example, data or estimates related to a potential
decrease in the number of disputes involving emergency department
services that would be realized if emergency department providers were
permitted to batch items and services across the five evaluation and
management Level I CPT codes, without a commensurate increase in the
diversity of documentation that certified IDR entities would need to
review to evaluate disputes related to different, but similar
conditions.
The Departments seek comment on the proposal to permit
anesthesiology, radiology, pathology, and laboratory qualified IDR
items and services that were furnished under service codes belonging to
the same Category I CPT code section, as specified in guidance
published by the Departments, including the proposed Category I CPT
code spans for batched determinations, and whether there are any items
and services similar to pathology, radiology, and laboratory qualified
IDR items and services to which this policy should apply. For example,
the Departments seek comment on whether additional batching
flexibility, consistent with the statutory requirements, is necessary
or appropriate for providers of lower-dollar items or services other
than laboratory, pathology, or radiology services, to remove
impediments and promote reasonable access to the Federal IDR process.
The Departments also request comment on the proposed pathology and
laboratory Category I CPT code spans for batched determinations.
Specifically, the Departments solicit comment on whether Organ or
Disease Oriented Panels, Urinalysis, and Chemistry Category I CPT codes
should be combined for batched determinations. The Departments
understand that these are frequently billed codes, and that such high
volume would be a reason to not combine these three code-span ranges
together. The Departments seek comment on this assumption, including
any data or other information that supports or contradicts the
Departments' understanding, such as if the volume of these codes for
out-of-network services would be substantially less.
Further, consistent with feedback from anesthesiologists, this
proposal would allow anesthesiologists to batch items and services
within a related body-part code group, which would align with the
established framework in the field. Anesthesiologists have expressed to
the Departments that while an anesthesia service for one spinal
procedure may be related to multiple different medical conditions, the
anesthesia administration itself is substantially similar. For example,
for spinal procedures, the anesthesia service may be related to
different spinal conditions such as stenosis or discectomy. Since the
anesthesia administration itself is substantially similar for these
different conditions, the Departments are of the view that these
conditions could be considered similar and that the payment
considerations a certified IDR entity would evaluate are similar.
As discussed in section II.E.2.b. of this preamble,
anesthesiologists have requested that claims be batched by the same
conversion factor, since contracting practices for anesthesiology items
and service focus on conversion factor rates, and not traditional codes
like CPT codes. The Departments have not identified a basis upon which
such conversion factor rates would satisfy the statutory requirement
that batched items and services relate to a similar condition at
section 9816(c)(3)(A)(iii) of the Code, section 716(c)(3)(A)(iii) of
ERISA, and section 2799A-1(c)(3)(A)(iii) or how conversion factors are
a meaningful method of encouraging efficiency. It is the Departments'
understanding that because conversion factors would be identical for
every out-of-network service furnished by an anesthesiologist provider
or provider group, use of the ``same conversion factor'' for batching
would result in the provider or provider group being able to batch
every out-of-network service it furnishes that otherwise satisfies the
remaining batching factors. Instead, the Departments are of the view
that batching based on CPT code categories would lead to greater
efficiency, would more closely align with the statutory requirement
that batched items and services relate to the treatment of a similar
condition, and would lead to less variability among the items and
services and factual circumstances that certified IDR entities must
consider.
The Departments request comment on the proposal that would govern
whether anesthesiology qualified IDR items and services are considered
to relate to the treatment of similar conditions. Specifically, the
Departments solicit comment on whether and how items and services that
share the same anesthesia conversion factor could be considered to
relate to the treatment of similar conditions and could meaningfully
encourage efficiency in the Federal IDR process. The Departments
request comment on these proposals, including any data or other
information that supports or contradicts the Departments' understanding
underlying this proposal.
E. Batched Items and Services Must Have Been Furnished Within the Same
Time Period
Finally, the Departments propose at 26 CFR 54.9816-8(c)(4)(i)(D),
29 CFR 2590.716-8(c)(4)(i)(D), and 45 CFR 149.510(c)(4)(i)(D) that
batched qualified IDR items and services must have been furnished
within the same 30-business-day period following the date on which the
first item or service included in the batched determination was
furnished and have been the subjects of a 30-business-day open
negotiation period that ended within 4 business days of IDR initiation,
except as provided in proposed 26 CFR 54.9816-8(c)(5)(vii)(B), 29 CFR
2590.716-8(c)(5)(vii)(B), and 45 CFR 149.510(c)(5)(vii)(B), which refer
to the 90-calendar-day ``cooling off'' period. This is consistent with
section 9816(c)(3)(B) of the Code, section 716(c)(3)(B) of ERISA, and
section 2799A-1(c)(3)(B) of the PHS Act and is in effect the same as
the current regulations at 26 CFR 54.9816-8T(c)(3)(i)(D), 29 CFR
2590.716-8(c)(3)(i)(D), and 45 CFR 149.510(c)(3)(i)(D). The Departments
are also proposing a non-substantive amendment at 26 CFR 54.9816-
8(c)(4)(i)(D), 29 CFR 2590.716-8(c)(4)(i)(D), and 45 CFR
149.510(c)(4)(i)(D) to both remove the redundant language on the 90-
calendar-day ``cooling off'' period and correct the cross-reference to
paragraph 26 CFR 54.9816-8T(c)(5)(vii)(B), 29 CFR 2590.716-
8(c)(5)(vii)(B), and 45 CFR 149.510(c)(5)(vii)(B). The Departments do
not propose any alternative time periods for batched determinations, as
the Departments are of the view that the batching rules proposed in
these rules are sufficient to encourage procedural efficiency and
minimize administrative costs for the disputing parties.
The Departments solicit comment on the application of the cooling
off period after a determination on a dispute consisting of multiple
items and services batched by patient encounter or CPT code ranges. For
example, if provider X submitted a notice of IDR
[[Page 75791]]
initiation that included as part of a batched determination a single
view x-ray of the abdomen (CPT code 74018) to payer Y and the certified
IDR entity made a determination on the dispute, should provider X be
allowed to submit another dispute, such as a batched patient encounter
dispute, within the 90-day period following such determination that
involves a single view x-ray of the abdomen (CPT code 74018) to payer
Y? It is the Departments' understanding that under these proposed
batching rules, the 90-calendar-day cooling off period could result in
operational challenges and barriers both to disputing parties
submitting subsequent IDR disputes and certified IDR entities' review.
In the example of provider X that submitted a batched dispute with an
x-ray of the abdomen (CPT code 74018) to payer Y, and for which a
certified IDR entity had made a determination, provider X under the
proposed rules would have to ensure to not include an x-ray of the
abdomen (CPT code 74018) in any subsequent notices of IDR initiation to
payer Y within the 90-calendar-day period following such determination.
Where subsequent disputes involve larger numbers of items or services,
such as batched disputes based on patient encounters or CPT code
ranges, this could result in additional time a party must spend
excluding the specific item or service subject to the cooling off
period from the batch and could also present additional burdens on
certified IDR entities in assessing whether the cooling off period
applies to one item or service within a batch and therefore whether the
batched dispute is eligible for initiation of the Federal IDR process.
In addition, the Departments have heard from some providers that since
cooling off periods are allowed to overlap, and with each new written
determination issued the current cooling off period is extended before
it has ended, there are certain high-volume payers with which providers
may be required to wait multiple years before the Federal IDR process
could be initiated again. Batches for single patient encounters may
exacerbate this situation.
Under section 9816(c)(9) of the Code, section 716(c)(9) of ERISA,
and section 2799A-1(c)(9) of the PHS Act, the time periods required
under the No Surprises Act and 26 CFR 54.9816-8T, 26 CFR 54.9816-8, 29
CFR 2590.716-8, and 45 CFR 149.510 (other than the timing of the
payments to prevailing parties) may be modified at the Departments'
discretion to ensure that all claims that occur during a 90-day period
following a payment determination for which a notification is not
permitted to be submitted during such period by reason of the cooling-
off-period requirements are eligible for the IDR process. If the
proposed batching provisions are finalized, the Departments are
considering using this statutory waiver authority under section
9816(c)(9) of the Code, section 716(c)(9) of ERISA, and section 2799A-
1(c)(9) of the PHS Act, to shorten the 90-day cooling off time period
with respect to qualified IDR items and services for which a certified
IDR entity makes a payment determination as part of a batched dispute.
This would increase the efficiency of processing subsequently submitted
batched disputes and ensure that claims that occur during the cooling
off period are eligible for the Federal IDR process. The Departments
seek comment on this exception and alternative time periods the
Departments should consider for the cooling off period in this
circumstance. The Departments are considering shortening the cooling
off period for batched disputes to between 1 to 30 business days, if
the batching proposals are finalized. As discussed in this section of
the preamble, the Departments are of the view that the interaction of
the 90-day cooling off period with the proposed batching provisions
would reduce inefficiencies for the disputing parties, certified IDR
entities, and the Federal IDR process. Further, as discussed in section
II.E.2.c. of this preamble, section 9816(c)(3)(A) of the Code, section
716(c)(3)(A) of ERISA, and section 2799A-1(c)(3)(A) of the PHS Act
directs the Departments to ensure that the Federal IDR process operates
efficiently. Thus, the Departments are of the view that to encourage
the efficiency of the Federal IDR process (including minimizing costs),
the Departments should exercise their waiver authority to reduce the
length of the cooling off period to be as short as 1 business day.
Under these proposed rules, disputing parties would not be able to
realize the efficiencies of batching by patient encounter if both
parties may have to wait 90 business days before submitting a
subsequent dispute. For example, it is the Departments understanding
that it is highly likely that provider X could have multiple patient
encounter batched disputes that involve payer Y where at least one
common item or service would overlap in each of those disputes. The
Departments are also aware of concerns that due to throughput issues,
when payment determinations are made, and the inability to submit
disputes either because they could not be submitted as batched disputes
under the vacated batching rules or because the cooling off period
applied, the Federal IDR process has not been economically feasible for
all providers. The Departments are of the view that markedly reducing
the cooling off period, in combination with the other proposed
provisions in these rules, would help make the Federal IDR process both
more economically feasible and efficient for disputing parties. The
Departments have also heard from some payers that they are inundated
with multiple open negotiation notices and disputes from certain
providers making it difficult to meet the deadlines for each dispute.
For this reason, the Departments are considering as much as 30 business
days for the duration of the cooling off period for batched disputes as
it may help ensure parties are not inundated with disputes and provide
parties sufficient time to meet the different time-period requirements
of the Federal IDR process. The Departments solicit comment on this
proposal, including specific alternative time periods the Departments
should consider for the cooling off period. The Departments request any
data or other information that supports or contradicts the Departments'
understanding.
The Departments request comment on these proposals, including
whether there are different or additional ways to encourage procedural
efficiency and minimize administrative costs through the batching
rules.
ii. Treatment of Bundled Payment Arrangements
The Departments propose at 26 CFR 54.9816-8(c)(4)(ii), 29 CFR
2590.716-8(c)(4)(ii), and 45 CFR 149.510(c)(4)(ii) that qualified IDR
items and services that meet the definition of a bundled payment
arrangement at proposed 26 CFR 54.9816-3, 29 CFR 2590.716-3, and 45 CFR
149.30 may be submitted and considered as a single payment
determination for which the certified IDR entity must make one payment
determination for the multiple items and services included in the
bundled payment arrangement. The Departments further propose that
bundled payment arrangements submitted under paragraph (c)(4)(ii) would
continue to be subject to the certified IDR entity fee for single
determinations as described at 26 CFR 54.9816-8T(e)(2)(vii), 29 CFR
2590.716-8(e)(2)(vii), and 45 CFR 149.510(e)(2)(vii). These proposed
technical amendments to 26 CFR 54.9816-8(c)(4)(ii), 29 CFR 2590.716-
8(c)(4)(ii), and 45 CFR 149.510(c)(4)(ii) would include a reference to
the definition of ``bundled payment
[[Page 75792]]
arrangement,'' \167\ a correction that the certified IDR entity must
make one payment determination for the multiple qualified IDR items and
services included in the bundled payment arrangement, removal of the
language that bundled payment arrangements are subject to the rules for
batched determinations, and an updated cross reference to paragraph
(c)(4)(ii).
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\167\ As discussed in section II.A. of the preamble, the
Departments propose to amend 26 CFR 54.9816-3, 29 CFR 2590.716-3,
and 45 CFR 149.30 to define the term ``bundled payment
arrangement.''
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3. Administrative and Certified IDR Entity Fee Collection
The Departments propose to amend the administrative and certified
IDR entity fee provisions of 26 CFR 54.9816-8(d), 29 CFR 2590.716-8(d),
and 45 CFR 149.510(d) to adjust the timing of collection of the
administrative fee and make changes to the administrative fee structure
to ensure that the financial costs to the Departments to administer the
Federal IDR process align with the assessed administrative fees, to
encourage disputing parties to engage in meaningful open negotiations,
to accelerate dispute processing, and to reduce the burden on certified
IDR entities.
a. Establishment of the Administrative Fee Amount
Under section 9816(c)(8)(A) of the Code, section 716(c)(8)(A) of
ERISA, section 2799A-1(c)(8)(A) of the PHS Act, and the October 2021
interim final rules,\168\ each party to a determination must pay an
administrative fee for participating in the Federal IDR process. Under
section 9816(c)(8)(B) of the Code, section 716(c)(8)(B) of ERISA,
section 2799A-1(c)(8)(B) of the PHS Act, and the October 2021 interim
final rules,\169\ the administrative fee is established annually in a
manner so that the total administrative fees paid for a year are
estimated to be equal to the amount of expenditures estimated to be
made by the Departments to carry out the Federal IDR process for that
year.
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\168\ 26 CFR 54.9816-8T(d)(2)(i), 29 CFR 2590.716-8(d)(2)(i),
and 45 CFR 149.510(d)(2)(i).
\169\ 26 CFR 54.9816-8T(d)(2)(ii), 29 CFR 2590.716-8(d)(2)(ii),
and 45 CFR 149.510(d)(2)(ii).
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On September 26, 2023, the Departments issued the IDR Process Fees
proposed rules,\170\ proposing to amend the language at 26 CFR 54.9816-
8(d)(2)(ii), 29 CFR 2590.716-8(d)(2)(ii), and 45 CFR 149.510(d)(2)(ii)
to establish the Federal IDR process administrative fee amount through
notice and comment rulemaking, rather than in guidance.\171\ In the IDR
Process Fees proposed rules, the Departments proposed the methodology
to calculate the administrative fee amount for disputes initiated on or
after the later of the effective date of the IDR Process Fees proposed
rules or on January 1, 2024, by projecting the amount of expenditures
to be made by the Departments in carrying out the Federal IDR process
and dividing this by the projected number of administrative fees to be
paid by the parties. Using this methodology, the Departments proposed
an administrative fee of $150 per party per dispute. Additionally, the
Departments proposed that the administrative fee amount specified in
rulemaking would remain in effect until a new administrative fee amount
is specified in subsequent rulemaking. Furthermore, in the IDR Process
Fees proposed rules, the Departments proposed to remove the requirement
to set the administrative fee amount annually, allowing the Departments
the flexibility to update the administrative fee amount more or less
frequently than annually to increase the Departments' ability to
respond to changes in expenditures or collections that would require a
new administrative fee amount. The comment deadline on the IDR Process
Fees proposed rules is October 26, 2023. The Departments will review
all public comments received on the IDR Process Fees proposed rules.
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\170\ 88 FR 65888 (September 26, 2023).
\171\ In TMA IV, the District Court issued an opinion and order
holding that the process by which the Departments amended the
December 2022 fee guidance to increase the administrative fee for
the Federal IDR process from $50 to $350 per party for disputes
initiated during the calendar year beginning January 1, 2023, was a
violation of the Departments' obligation under the Administrative
Procedure Act to give affected parties notice of and an opportunity
to comment on the administrative fee. In light of the District
Court's opinion and order, as well as the Departments' reassessment
regarding the practicability of establishing the administrative fee
through notice and comment rulemaking, the Departments proposed in
the IDR Process Fees proposed rules to establish the amount of the
administrative fee through notice and comment rulemaking.
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The Departments note that a number of the proposed provisions in
these proposed rules would impact the collection of administrative
fees, including the time of collection of the administrative fee
discussed in section II.E.3.b. of this preamble, the proposed reduced
administrative fee for both parties in low-dollar disputes discussed in
section II.E.3.e. of this preamble, and the proposed reduced
administrative fee for non-initiating parties in ineligible disputes
discussed in section II.E.3.f. of this preamble and would therefore
impact the methodology that the Departments use to determine the
administrative fee. Accordingly, in these proposed rules, the
Departments propose to adjust the methodology for calculating the
administrative fee amount that was proposed in the IDR Process Fees
proposed rules. As discussed in greater detail below, while in the IDR
Process Fees proposed rules the Departments proposed to calculate the
projected number of administrative fees to be paid using the total
volume of disputes to be closed, in these proposed rules, the
Departments propose to instead use the total volume of disputes to be
initiated, due to the proposal to collect the administrative fee
earlier in the Federal IDR process, as discussed further in section
II.E.3.b. of this preamble.
In addition, the Departments are proposing other policies in these
proposed rules that, if finalized, would impact the Departments'
expenditures in carrying out the Federal IDR process, including the
proposed departmental eligibility review discussed in section
II.E.1.b.ii. of this preamble, the direct collection of the
administrative fee by the Departments discussed in section II.E.3.c. of
this preamble, and the proposed Federal IDR process registry discussed
in section II.F. of this preamble, which would impact the inputs under
the methodology used to calculate the administrative fee amount.
The Departments note that, using the base methodology as proposed
in the IDR Process Fees proposed rules, and taking into account the
additional proposed policies in these rules and their impact on the
inputs under the administrative fee methodology proposed in the IDR
Process Fees proposed rules, the administrative fee amount would
continue to be $150 per party per dispute.
In light of the proposals in these rules, the Departments project
the annual expenditures to carry out the Federal IDR process, if the
proposals in these rules are finalized, to be approximately $100.2
million. The proposed expenditures upon which the administrative fee
amount in these rules is based include contract costs and Federal
resources associated with:
Maintaining the Federal IDR portal, including the proposed
Federal IDR process registry discussed in section II.F. of this
preamble, which is intended to make the parties' and certified IDR
entities' experiences using the portal more efficient, clear, and
streamlined;
Certifying IDR entities and collecting data from them,
which is intended to increase the number of certified IDR entities,
improve the speed of eligibility and payment determinations, and assist
the Departments in understanding where efficiencies may still be gained
in the process;
[[Page 75793]]
Conducting program integrity activities, such as QPA
audits and IDR decision audits, which are intended to ensure the
program integrity by reducing and preventing errors in the Federal IDR
process;
Investigating relevant complaints, which is intended to
ensure compliance with the Federal IDR process requirements;
Providing outreach to parties and technical assistance to
certified IDR entities, which is intended to streamline the experience
and further improve the speed and integrity of eligibility and payment
determinations;
Collecting administrative fees directly from disputing
parties, which is intended to reduce burden on certified IDR entities,
increasing capacity of certified IDR entities to perform other required
functions;
Conducting eligibility determinations when any of the
extenuating circumstances described in proposed 26 CFR 54.9816-8(g), 29
CFR 2590.716-8(g), and 45 CFR 149.510(g) require application of the
departmental eligibility review to facilitate timely payment
determinations or the effective processing of disputes under the
Federal IDR process; and
Retaining and making available Federal personnel dedicated
to carrying out Federal IDR process activities.
Further, as described above, estimates for these expenditures
assume that the Departments would determine that extenuating
circumstances exist to invoke the departmental eligibility review, as
discussed in sections II.E.1.b.ii. through iv. of this preamble and as
proposed in 26 CFR 54.9816-8(c)(2)(ii), 29 CFR 2590.716-8(c)(2)(ii),
and 45 CFR 149.510(c)(2)(ii). The Departments began conducting pre-
eligibility reviews in 2023 to allow the certified IDR entities to
complete their eligibility determinations more efficiently. As
discussed in section II.E.1.b.ii. of this preamble, the departmental
eligibility review proposed in these proposed rules contemplates a
similar process except that the Departments would make eligibility
determinations, rather than eligibility recommendations, to certified
IDR entities.
With respect to the Departments' projected number of administrative
fees to be paid, in the IDR Process Fees proposed rules, the
Departments proposed to base this number on the total volume of
disputes that were projected to be closed. However, in these proposed
rules, the Departments propose to project the number of administrative
fees to be paid based on the total volume of disputes projected to be
initiated. In the IDR Process Fee proposed rules, the Departments
proposed to use the total volume of disputes projected to be closed,
rather than the total volume of disputes projected to be initiated,
because the total volume of closed disputes would be more indicative of
the total volume of disputes for which fees are paid under the
Departments' current collections process.\172\ In these proposed rules,
the Departments propose to instead use the total volume of disputes
projected to be initiated because the proposed operational changes in
these proposed rules, if finalized, would result in the Departments'
collection of administrative fees closer to a dispute's date of
initiation, and therefore, the total volume of initiated disputes would
be indicative of the total volume of disputes for which fees would be
paid.
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\172\ 88 FR 65888, 65893.
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Additionally, in projecting the administrative fees to be paid, the
Departments consider that, if the proposed policies described in
sections II.E.3.e. and II.E.3.f. of this preamble are finalized, the
initiating and non-initiating parties in ineligible and low-dollar
disputes may pay a reduced administrative fee, which would be
percentages of the full administrative fee amount. To arrive at the
proposed reduced administrative fee percentages, the Departments
analyzed historical trends of low-dollar and ineligible disputes and
include further discussion of the calculation of these percentages in
sections II.E.3.e. and II.E.3.f. of this preamble. As with the full
administrative fee amount, the Departments propose at 26 CFR 54.9816-
8(d)(2)(iii), 29 CFR 2590.716-8(d)(2)(iii), and 45 CFR
149.510(d)(2)(iii) that the reduced administrative fee amounts would
remain in effect until changed by subsequent rulemaking. Accordingly,
the total amount of projected administrative fees paid is calculated to
reflect that the Departments would not collect a full administrative
fee from both parties on a portion of disputes.
To determine the administrative fees to be paid, the Departments
project approximately 420,000 disputes will be initiated annually. This
projection is based on the most recent 6-month period of continuous
Federal IDR process data before Federal IDR process operations were
temporarily paused on August 3, 2023.\173\ Using this projected volume
of disputes, the Departments assume a prospective reduction of
approximately 25 percent in the volume of initiated disputes because of
the anticipated impact of the proposed batching policies in these
proposed rules, if finalized. As previously explained, to calculate the
number of administrative fees to be paid from the projected volume of
disputes initiated, the Departments consider that non-initiating and
initiating parties may pay a reduced administrative fee in low-dollar
and ineligible disputes if the proposed policies described in sections
II.E.3.e. and II.E.3.f. of this preamble are finalized. Additionally,
the Departments consider the proposals in these rules pertaining to
open negotiation, initiation, batching, registration, and the other
administrative fee policies, if finalized, in calculating the number of
disputes initiated and this administrative fee amount.
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\173\ The Departments applied the approximate 25 percent
reduction described in these rules to the average monthly volume and
multiplied this number by 12 to project the annual volume of
initiated disputes.
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Therefore, the Departments estimate that 420,000 initiated
disputes, which include low-dollar and ineligible disputes with reduced
administrative fees, would translate to an amount approximately equal
to 691,000 full administrative fees paid. This estimate reflects that
both parties to a dispute pay an administrative fee. Further, based on
Federal IDR process data, the Departments estimate that 20 percent of
initiated disputes would qualify as low-dollar disputes and 22 percent
of initiated disputes would be ineligible. As described in Table 5, the
Departments estimate that low-dollar and ineligible disputes will
overlap such that some low-dollar disputes are determined to be
ineligible. As explained further in sections II.E.3.e. and II.E.3.f. of
this preamble, non-initiating parties would pay 20 percent of the full
administrative fee in ineligible disputes and both initiating and non-
initiating parties would pay 50 percent of the full administrative fee
in low-dollar disputes.
Using the proposed methodology and inputs discussed above, the
administrative fee for disputes initiated on or after January 1, 2025,
and continuing until changed by subsequent rulemaking, would be
calculated by dividing the projected annual expenditures of
approximately $100.2 million to be made by the Departments in carrying
out the Federal IDR process by the projected annual number of
administrative fees to be paid by the disputing parties of 691,000.
This results in a full administrative fee amount of $150 per party per
dispute, which is the same amount as the Departments proposed in the
IDR Process Fees proposed rules. However,
[[Page 75794]]
as described in this preamble section, the methodology and inputs for
calculating the administrative fee in these proposed rules differ from
those in the IDR Process Fees proposed rules. In the IDR Process Fees
proposed rules, the Departments calculated the proposed administrative
fee by dividing projected annual expenditures of $70 million by
approximately 450,000 full administrative fees paid on 225,000 closed
disputes.
As discussed further in sections II.E.3.e. and II.E.3.f. of these
rules, the reduced administrative fee for both parties in low-dollar
disputes would be 50 percent of the full administrative fee (or $75)
per party per dispute, and the reduced administrative fee for non-
initiating parties in ineligible disputes would be 20 percent of the
full administrative fee (or $30) per party per dispute. These fee
estimates, as set forth in Table 5, are based on the best available
data, the Departments' projected expenditures as of the publication of
these proposed rules, and the assumptions that the administrative fee
of $150 per party per dispute in the IDR Process Fees proposed rules is
finalized and applicable starting January 1, 2024. These projections
may change between the publication of the proposed and final rules
based on more recent data available at that time; thus, the Departments
propose to finalize an administrative fee amount that follows the
methodology proposed here, as finalized, using the updated data, if
applicable. In the event one or more of the policies proposed in these
rules are not finalized or the departmental eligibility review is not
anticipated to be invoked, the Departments would recalculate the
proposed administrative fee amount to reflect relevant changes to the
proposed policies when finalizing the administrative fee amount.
BILLING CODE 6325-63-P; 4830-01-P; 4510-29-P; 4120-01-P
[[Page 75795]]
[GRAPHIC] [TIFF OMITTED] TP03NO23.008
BILLING CODE 6325-63-C; 4830-01-C; 4510-29-C; 4120-01-C
The Departments solicit comments on the methodology for calculating
the administrative fee, additional inputs used to calculate the
administrative fee
[[Page 75796]]
and proposed administrative fee amounts, including the reduced
administrative fee amounts, as well as the proposed implementation date
of the proposed administrative fee.
b. Time of Collection of Certified IDR Entity Fee and Administrative
Fee
i. Time of Collection of Certified IDR Entity Fee
The Departments propose to amend 26 CFR 54.9816-8(d)(1)(i), 29 CFR
2590.716-8(d)(1)(i), and 45 CFR 149.510(d)(1)(i) to reflect that each
party to a dispute that either the certified IDR entity or the
Departments determine is eligible for the Federal IDR process must pay
to the certified IDR entity the predetermined certified IDR entity fee
no later than the time the parties submit their offers, as described in
proposed 26 CFR 54.9816-8(c)(5)(i), 29 CFR 2590.716-8(c)(5)(i), and 45
CFR 149.510(c)(5)(i).
The Departments also propose to codify in 26 CFR 54.9816-
8(d)(1)(iii), 29 CFR 2590.716-8(d)(1)(iii), and 45 CFR
149.510(d)(1)(iii) the current practice established in section 10.2 of
the Federal IDR Process Guidance for Certified IDR Entities \174\ that
the certified IDR entity must retain the certified IDR entity fee
described in 26 CFR 54.9816-8(d)(1)(i), 29 CFR 2590.716-8(d)(1)(i), and
45 CFR 149.510(d)(1)(i) paid by the party whose offer was not selected
(the non-prevailing party, as defined in proposed 26 CFR 54.9816-
8(c)(5)(ii)(A)(2), 29 CFR 2590.716-8(c)(5)(ii)(A)(2), and 45 CFR
149.510(c)(5)(ii)(A)(2)), consistent with the No Surprises Act.\175\
The Departments further propose to move the existing requirement in
current paragraph 26 CFR 54.9816-8T(d)(1)(ii), 29 CFR 2590.716-
8(d)(1)(ii), and 45 CFR 149.510(d)(1)(ii), which requires the certified
IDR entity to return the fee paid by the prevailing party within 30
business days following the date of the certified IDR entity's payment
determination, to 26 CFR 54.9816-8(d)(1)(iii), 29 CFR 2590.716-
8(d)(1)(iii), and 45 CFR 149.510(d)(1)(iii). Further, the Departments
propose that in the event of a batched dispute in which each party
prevails in an equal number of determinations, the certified IDR entity
fee would be split evenly between the parties. In that case, the
certified IDR entity would be required to return half of the fee paid
by each party within 30 business days following the date of the
certified IDR entity's payment determination.
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\174\ Centers for Medicare & Medicaid Services (Mar. 2023).
Federal Independent Dispute Resolution (IDR) Process Guidance for
Certified IDR Entities. https://www.cms.gov/files/document/federal-idr-guidance-idr-entities-march-2023.pdf.
\175\ Section 9816(c)(5)(F)(i) of the Code, section
716(c)(5)(F)(i) of ERISA, and section 2799A-1(c)(5)(F)(i) of the PHS
Act.
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Additionally, the Departments propose to add 26 CFR 54.9816-
8(d)(1)(iv), 29 CFR 2590.716-8(d)(1)(iv), and 45 CFR 149.510(d)(1)(iv)
to provide that when the parties reach an agreement on an out-of-
network rate for qualified IDR items or services, as described in
proposed 26 CFR 54.9816-8(c)(3)(i), 29 CFR 2590.716-8(c)(3)(i), and 45
CFR 149.510(c)(3)(i), or agree to withdraw a dispute under the
circumstances set forth at proposed 26 CFR 54.9816-8(c)(3)(ii), 29 CFR
2590.716-8(c)(3)(ii), and 45 CFR 149.510(c)(3)(ii), for a dispute that
has already been assigned to a certified IDR entity and determined
eligible for the Federal IDR process but for which the certified IDR
entity has not made a payment determination, the certified IDR entity
must return half of each party's certified IDR entity fee within 30
business days of the agreement or withdrawal, unless directed otherwise
by both parties. This proposed new paragraph would relocate the similar
requirement when parties reach an agreement, currently captured in 26
CFR 54.9816-8T(c)(2)(ii) and (e)(2)(viii), 29 CFR 2590.716-8(c)(2)(ii)
and (e)(2)(viii), and 45 CFR 149.510(c)(2)(ii) and (e)(2)(viii), which
require the certified IDR entity to return half of each party's
certified IDR entity fee within 30 business days of an agreement, and
codifies the Departments' interpretation that a withdrawal of a dispute
should be treated similarly to a settlement. Similar to when parties
settle prior to an eligibility determination and therefore do not need
to pay the certified IDR entity fee because the certified IDR entity
did not make an eligibility and/or payment determination, when a
dispute is withdrawn prior to an eligibility determination, the
Departments are of the view that the parties similarly should not be
required to pay the fee because the certified IDR entity again did not
make an eligibility and/or payment determination. Accordingly, because
the certified IDR entity fee is only assessed for disputes that are
determined eligible for the Federal IDR process, the Departments
clarify that the certified IDR entity fee would not be assessed for a
dispute that is withdrawn or settled before the Departments or the
certified IDR entity, as applicable, make a determination on the
eligibility of the dispute for the Federal IDR process. However,
because the obligation to pay the certified IDR entity fee applies to
all eligible disputes, both parties would still be required to pay the
certified IDR entity fee if the dispute is withdrawn or settled after
the dispute is determined eligible but before the certified IDR entity
makes a payment determination.
Finally, the Departments propose to add 26 CFR 54.9816-8(d)(1)(v),
29 CFR 2590.716-8(d)(1)(v), and 45 CFR 149.510(d)(1)(v) to provide that
when the parties reach an agreement on an out-of-network rate or agree
to withdraw the dispute for which there is a final selection of the
certified IDR entity but that has not yet had a final eligibility
determination, unless directed otherwise by both parties, the certified
IDR entity would be required to return each party's full certified IDR
entity fee within 30 business days of the date both parties notify the
certified IDR entity that they have agreed on an out-of-network rate or
agreed to withdraw the dispute. The purpose of this proposal is to
codify the responsibilities of the parties and certified IDR entities
when the parties agree to settle or withdraw the dispute, but the
dispute has not yet been determined eligible for the Federal IDR
process. Similar to the proposal regarding settlements and withdrawals
for eligible disputes, because the certified IDR entity fee is only
assessed for disputes that are determined eligible for the Federal IDR
process, the certified IDR entity fee would not be assessed for a
dispute that is withdrawn or settled before the Departments or the
certified IDR entity, as applicable, determine the eligibility of the
dispute for the Federal IDR process.
The Departments seek comment on these proposals including the
treatment of a withdrawal of a dispute similar to a settlement.
ii. Time of Collection of Administrative Fee
The Departments are also proposing multiple changes to the timing
of the collection of the administrative fee in proposed 26 CFR 54.9816-
8(d)(2)(i)(A), 29 CFR 2590.716-8(d)(2)(i)(A), and 45 CFR
149.510(d)(2)(i)(A). The Departments propose to require the initiating
party to pay the administrative fee within 2 business days of the date
of preliminary selection of the certified IDR entity pursuant to
proposed 26 CFR 54.9816-8(c)(1)(iii), 29 CFR 2590.716-8(c)(1)(iii), and
45 CFR 149.510(c)(1)(iii). The Departments further propose that the
non-initiating party must pay the administrative fee within 2 business
days of the date of notice that an eligibility determination for the
Federal IDR process has been reached by either the certified IDR entity
or the Departments, if the
[[Page 75797]]
departmental eligibility review applies as proposed in 26 CFR 54.9816-
8(c)(2)(ii), 29 CFR 2590.716-8(c)(2)(ii), and 45 CFR 149.510(c)(2)(ii).
As discussed in section II.E.3.f. of this preamble, the Departments
propose that the non-initiating party would pay a reduced
administrative fee for disputes that are determined ineligible for the
Federal IDR process; therefore, eligibility would need to be determined
before the non-initiating party is charged the administrative fee. The
Departments are of the view that 2 business days to pay the
administrative fee would be an appropriate amount of time from the date
of preliminary selection of the certified IDR entity (for initiating
parties) and from the date of notice of an eligibility determination
(for non-initiating parties), because it balances the need for the
parties to have adequate notice of the fee being due and adequate time
to pay the fee with the need to continue to move the Federal IDR
process forward and provide parties with timelier payment
determinations.
Although the Departments considered requiring both parties to pay
the administrative fee within the same 2-business-day period, failure
of the initiating party to pay the administrative fee would result in
dispute dismissal as discussed in section II.E.3.d. of this preamble,
and neither party would owe the administrative fee for such a dispute.
Additionally, the Departments are of the view that it is appropriate to
align the non-initiating party's deadline to pay the administrative fee
with the date of the eligibility determination because, as proposed in
these rules and described in section II.E.3.f. of this preamble, the
non-initiating party's administrative fee amount would be determined
based on the eligibility of the dispute.
The Departments are of the view that this timing would better
ensure that the financial costs to the Departments to administer the
Federal IDR process align with the assessed administrative fees.
Specifically, as explained in section II.E.3.f. of this preamble, the
Departments are of the view that requiring non-initiating parties to
pay a reduced administrative fee if the dispute is ineligible would be
appropriate because it would take into account the benefits that non-
initiating parties receive from having access to the Federal IDR
process. Currently, for administrative efficiency, the Departments'
guidance allows certified IDR entities the discretion to delay
collection of the administrative fee until a party submits its
offer,\176\ which is the same time that each party is required to pay
the certified IDR entity fee described in 26 CFR 54.9816-8T(d)(1), 29
CFR 2590.716-8(d)(1), and 45 CFR 149.510(d)(1). Amending the timing for
administrative fee collection would accelerate dispute processing and
ensure that the costs of using the Federal IDR process are being
allocated to all parties accessing the process, regardless of whether
their disputes are eligible or ineligible.
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\176\ See U.S. Department of Health and Human Services, U.S.
Department of Labor, and U.S. Department of the Treasury. (Oct.
2022). Federal Independent Dispute Resolution (IDR) Process Guidance
for Certified IDR Entities. https://www.cms.gov/files/document/federal-independent-dispute-resolution-guidance-disputing-parties.pdf.
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Furthermore, the Departments propose at 26 CFR 54.9816-
8(d)(2)(i)(B), 29 CFR 2590.716-8(d)(2)(i)(B), and 45 CFR
149.510(d)(2)(i)(B) that when the parties reach an agreement on an out-
of-network rate for qualified IDR items or services or agree to
withdraw the dispute after the dispute is initiated, the administrative
fee would not be returned to the parties if preliminary selection of
the certified IDR entity has occurred, as described in 26 CFR 54.9816-
8(c)(1)(i), 29 CFR 2590.716-8(c)(1)(i), and 45 CFR 149.510(c)(1)(i).
This new paragraph would relocate the similar requirement when parties
reach an agreement, currently captured in 26 CFR 54.9816-8T(c)(2)(ii),
29 CFR 2590.716-8(c)(2)(ii), and 45 CFR 149.510(c)(2)(ii), which
provides that the administrative fee will not be returned to the
parties in the event of an agreement, and extends those requirements in
the event of a dispute withdrawal. The Departments are of the view that
these proposed policies would help ensure that disputing parties are
appropriately incentivized to settle disputes through open negotiation
before initiating the Federal IDR process. The Departments expect that
submission of ineligible disputes would decrease because of this
financial incentive combined with the proposed changes to open
negotiation, discussed in section II.D. of this preamble, requiring the
initiating party to attest that the item or service under dispute is a
qualified IDR item or service and to identify the basis for the
attestation, which would necessitate the initiating party actively
evaluating eligibility before initiating the Federal IDR process.
The Departments also propose in this paragraph that the
administrative fee would still be required to be paid if the parties
have not yet paid it at the time of settlement or withdrawal, unless
the dispute is closed for nonpayment of the administrative fee by the
initiating party 2 business days after preliminary selection of the
certified IDR entity. This proposal aligns with the current regulation
at 26 CFR 54.9816-8T(d)(2)(i), 29 CFR 2590.716-8(d)(2)(i), and 45 CFR
149.510(d)(2)(i) providing that the administrative fee is non-
refundable, as discussed in the October 2021 interim final rules.\177\
As stated in the October 2021 interim final rules, the Departments will
have incurred expenditures to administer the Federal IDR process even
in instances in which the parties reach an agreement before the
certified IDR entity makes a payment determination. Thus, the
Departments are proposing to codify the requirement that parties must
pay the administrative fee for these disputes.
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\177\ 86 FR 56001.
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Requiring the initiating party to pay the administrative fee within
2 business days of the date the certified IDR entity is preliminarily
selected, which would occur before a dispute's eligibility
determination is made, would provide an incentive to initiating parties
to reduce the number of ineligible disputes submitted and ensure that
the financial burden for administering the Federal IDR process is
shared across the parties accessing the process. Consequently, the
Departments anticipate that fewer ineligible disputes would be
submitted, and all disputes in which a certified IDR entity is
preliminarily selected would contribute to the funds available to
administer the Federal IDR process, regardless of eligibility. The
Departments are of the view that this would improve overall efficiency
in the Federal IDR process and potentially enable the Departments to
lower the administrative fee at a future date in notice and comment
rulemaking, as the costs of carrying out the Federal IDR process would
be more equally allocated across a larger proportion of submitted
disputes.
The Departments seek comment on these proposals.
c. Manner of Administrative Fee Collection
The Departments propose to amend 26 CFR 54.9816-8(d)(2)(i), 29 CFR
2590.716-8(d)(2)(i), and 45 CFR 149.510(d)(2)(i) to require each party
participating in the Federal IDR process to pay the administrative fee
directly to the Departments, instead of to the certified IDR entity for
remittance to the Departments, as is currently required. The purpose of
this proposal would be to improve dispute processing times and reduce
certified IDR entities'
[[Page 75798]]
administrative burden. To support the transition to this proposed
approach of directly collecting the administrative fee and to improve
the operation of current processes, the Departments also propose to
make conforming amendments to 26 CFR 54.9816-8(e)(2)(vi) and (ix), 29
CFR 2590.716-8(e)(2)(vi) and (ix), and 45 CFR 149.510(e)(2)(vi) and
(ix) to reflect that certified IDR entities must maintain appropriate
safeguards, controls, and procedures for any administrative fees they
may be in possession of before the effective date of the proposed
change to the manner of administrative fee collection, if finalized.
The October 2021 interim final rules established that each
disputing party's administrative fee was due upon selection of the
certified IDR entity and payable to the certified IDR entity.\178\ The
Departments explained that allowing the certified IDR entity to collect
the administrative fee on behalf of the Departments could increase
efficiency, streamline the Federal IDR process, and allow for more
convenient payment for the disputing parties and the Departments.\179\
However, there are many disputes in the Federal IDR process for which
no fee has been collected for the work associated with processing the
dispute, and the Departments are now of the view that collection of the
administrative fee by the Departments directly rather than the
certified IDR entities would be more efficient. The Departments are
also of the view that, in light of the proposal to collect the
administrative fee earlier in the process as proposed in these rules,
collection of the administrative fee by the Departments would
significantly reduce the burden on certified IDR entities because they
would not have to collect fees at two different points in time, track
collection of both fees, and then remit payment of the administrative
fee to the Departments, as would be required if the proposal to change
the administrative fee timing was finalized but the manner of
collection was unchanged. Additionally, enabling the Departments to
directly collect the administrative fee from the disputing parties may
improve collection of the fee, in part through Federal debt collection
mechanisms as outlined in section II.E.3.d. of this preamble. Finally,
since these proposed rules would require parties to submit open
negotiation notices, open negotiation notice responses, notices of
initiation, and notice of initiation responses through the Federal IDR
portal, as discussed in section II.D. of this preamble, the Departments
would be in the best position to determine the appropriate time to bill
and collect the administrative fee from the parties given the
Departments' access to this information.
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\178\ 86 FR 56001.
\179\ Id.
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The Departments seek comment on this proposal. Additionally, the
Departments seek comment on restricting the manner of payment of
administrative and certified IDR entity fees to only electronic
payments, including electronic funds transferred from a bank account,
rather than allowing payment by check.
d. Application of Federal IDR Process Requirements in Circumstances
Involving a Failure To Pay Certified IDR Entity Fees or Administrative
Fees
To further streamline dispute processing, these proposed rules
outline certain consequences that would apply for failure to timely pay
the certified IDR entity fee, the administrative fee, or both fees.
Specifically, the Departments propose in paragraph 26 CFR 54.9816-
8(d)(1)(ii), 29 CFR 2590.716-8(d)(1)(ii), and 45 CFR 149.510(d)(1)(ii)
that if either party fails to pay the certified IDR entity fee by the
time the offer is due, that party's offer would not be considered
received. The Departments also propose that if a party fails to submit
an offer or a party's offer is not considered received due to
nonpayment of the certified IDR entity fee, the non-prevailing party
would continue to be responsible for payment of the certified IDR
entity fee. This means that a certified IDR entity would be able to
take all steps consistent with applicable law to collect any certified
IDR entity fee owed to it.
The Departments do not propose to change the requirement that each
party to a dispute for which a certified IDR entity is selected must
pay a non-refundable administrative fee to participate in the Federal
IDR process.\180\ Further, the Departments do not propose to change the
requirement that the party whose offer is not selected by the certified
IDR entity is ultimately responsible for payment of the certified IDR
entity fee.\181\
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\180\ See 26 CFR 54.9816-8T(d)(2)(i), 29 CFR 2590.716-
8(d)(2)(i), and 45 CFR 149.510(d)(2)(i).
\181\ See id.
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Additionally, the Departments propose to add new proposed paragraph
26 CFR 54.9816-8(d)(2)(i)(C), 29 CFR 2590.716-8(d)(2)(i)(C), and 45 CFR
149.510(d)(2)(i)(C) setting forth that if the initiating party fails to
pay the administrative fee within 2 business days of the date of
preliminary selection of the certified IDR entity under paragraph
(c)(1)(iii), the dispute would be closed due to nonpayment and neither
party would be responsible for the administrative fee. If a dispute is
closed for nonpayment of the administrative fee by the initiating
party, the Departments would not impose an obligation to pay the
administrative fee on either party, since the dispute was terminated
before substantial work was undertaken to process it. The Departments
also propose in new paragraph (d)(2)(i)(C) that if the non-initiating
party fails to pay the administrative fee within 2 business days of an
eligibility determination, that party's offer would not be considered
received. Even if the non-initiating party fails to submit an offer or
the non-initiating party's offer is not considered received due to
nonpayment of the administrative fee in accordance with paragraph
(d)(2)(i)(A), the non-initiating party would continue to be responsible
for payment of the administrative fee. In addition, if the dispute is
determined to be ineligible for the Federal IDR process, the non-
initiating party would continue to be responsible for payment of the
reduced administrative fees discussed in section II.E.3. of this
preamble.
Further, the Departments propose to provide in 26 CFR 54.9816-
8(d)(2)(i)(D), 29 CFR 2590.716-8(d)(2)(i)(D), and 45 CFR
149.510(d)(2)(i)(D) that any party that fails to timely pay the
administrative fee owed in accordance with paragraph (d)(2)(i)(A) of
this section is still obligated to pay the administrative fee otherwise
due and owing, and that failure to pay the administrative fee would
result in a debt owed to the Federal Government, after netting any
amounts owed by the Federal Government in accordance with 45 CFR
156.1215, as applicable.\182\ The debt would then be collected pursuant
to applicable debt collection authorities, including those that
prescribe government-wide standards for administrative collection,
compromise, disclosure of debt information to credit reporting
agencies, referral of claims to private collection contractors for
resolution, and referral to the Department of Justice for litigation.
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\182\ HHS intends to propose in notice and comment rulemaking in
the near future to amend 45 CFR 156.1215 to provide that
administrative fees for utilizing the No Surprises Act Federal IDR
process for health insurance issuers that participate in financial
programs under the ACA would be subject to netting as part of HHS'
integrated monthly payment and collections cycle. The netting
proposals at 45 CFR 156.1215 would only apply to those issuers and
their affiliates operating under the same TIN that participate in
the financial programs under the ACA.
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[[Page 75799]]
Additionally, the Departments propose that the party to the dispute
that incurs the debt would be determined by the TIN or NPI associated
with the plan, issuer, provider, facility, or provider of air ambulance
services that is a party to the dispute, which may not be the entity
that filed the dispute. This means that when a plan that is a party to
a dispute utilizes a TPA or other representative, it is the plan that
would incur the administrative fee debt, not the TPA or representative.
Similarly, if a provider or facility engages a revenue cycle management
company or other representative, the provider or facility would be
responsible for the administrative fee debt, not the revenue cycle
management company or other representative. A TPA, revenue cycle
management company, or other representative would still be allowed to
manage or initiate the Federal IDR process on behalf of a disputing
party, including remitting the administrative fee amount on behalf of
the party to the dispute.
The Departments are of the view that codifying the consequences of
failure to pay the certified IDR entity fees and administrative fees
would increase transparency and reduce the incidence of nonpayment. The
Departments seek comment on these proposals.
e. Administrative Fee Structure for Disputing Parties in Low-Dollar
Disputes
The Departments are proposing a framework to reduce the
administrative fee for parties in low-dollar disputes to promote
equitable access across the spectrum of parties seeking to initiate the
Federal IDR process, such as providers in rural communities, small
practices, specialties that regularly bill for services that have low-
dollar costs, and issuers with a smaller pool of claims to absorb the
impact of a standard administrative fee assessed for low-dollar
disputes.
The Departments propose to add 26 CFR 54.9816-8(d)(2)(iii)(A)
through (C), 29 CFR 2590.716-8(d)(2)(iii)(A) through (C), and 45 CFR
149.510(d)(2)(iii)(A) through (C) to establish a framework for reducing
the administrative fee in certain situations. The Departments propose
in 26 CFR 54.9816-8(d)(2)(iii)(A), 29 CFR 2590.716-8(d)(2)(iii)(A), and
45 CFR 149.510(d)(2)(iii)(A) to charge both parties a reduced
administrative fee when the initiating party attests that the highest
offer made during open negotiation by either party was less than the
predetermined threshold proposed in these rules. The Departments
propose that in order for both parties to be charged a reduced
administrative fee for a dispute, the highest offer (or aggregate
offers for a dispute, whether the dispute is for one item or service, a
bundled payment arrangement, or multiple items and services submitted
as part of a batched dispute) made during open negotiation for such
dispute by either party must be less than the amount of the full
administrative fee. As such, the Departments propose that the threshold
that would apply for disputes initiated on or after January 1, 2025
would equal the amount of the standard administrative fee as proposed
in section II.E.3.a. of this preamble, which is proposed to be $150 for
disputes initiated on or after January 1, 2025.
Further, the Departments propose in 26 CFR 54.9816-8(d)(2)(iii)(A),
29 CFR 2590.716-8(d)(2)(iii)(A), and 45 CFR 149.510(d)(2)(iii)(A) that
the reduced administrative fee amount for these low-dollar disputes
would be 50 percent of the administrative fee amount, equating to $75
per party per dispute for disputes initiated on or after January 1,
2025, if the proposed administrative fee amount of $150 per party per
dispute is finalized. To determine the amount of the reduced
administrative fee, the Departments evaluated various factors
pertaining to low-dollar disputes. This discussion appears in section
II.E.3.f. of this preamble.
As discussed in section II.E.2. of this preamble, interested
parties have expressed concerns that disputes over relatively low-
dollar claims, such as radiology claims, are being priced out of the
Federal IDR process due to difficulties with batching items and
services of sufficient value to make the Federal IDR process feasible.
While the Departments anticipate that the new batching provisions
proposed in these rules and discussed in section II.E.2. of this
preamble would make the Federal IDR process more accessible to many
parties, the Departments also want to consider other mechanisms to
ensure that the Federal IDR process is financially accessible to a
greater number of parties, including parties from rural communities,
smaller organizations, and parties disputing services related to
specialties that bill for low-dollar services. These parties may have
more claims for low-dollar services than other types of parties due to
the nature of their practice, which may result in fewer disputes that
meet the batching requirements, making batching claims impractical for
such parties. Even though the Departments recognize that disputes vary
in complexity, resolving a dispute generally costs the Departments the
same amount regardless of whether the dispute involves low-dollar or
high-dollar items or services. Accordingly, the Departments are
proposing this administrative fee structure to further the goal of
financial accessibility while ensuring that the Departments can collect
sufficient funds to cover the costs of carrying out the Federal IDR
process. If either or both parties to the dispute attest to satisfying
the requirements for a reduced administrative fee but the Departments
determine that either or both parties did not act in good faith in
their submissions or responses, the Departments may decline to charge a
reduced administrative fee. The Departments solicit comments on
situations in which it would be appropriate for the Departments to
decline to charge a party the reduced administrative fee, such as if
the initiating party incorrectly attests that no offer submitted during
open negotiation exceeded the threshold, and the Departments also
solicit comments on additional approaches the Departments should
consider to mitigate potential abuse of the proposed reduced
administrative fee structure.
Under these proposed rules, a party initiating a dispute in the
Federal IDR portal using the notice of IDR initiation form discussed in
section II.D.2.a. of this preamble would be required to attest in the
Federal IDR portal that the highest offer (including the cumulative
total of all line items for batched disputes) made during open
negotiation by either party was less than the predetermined threshold,
which the Departments propose would equal the amount of the full
administrative fee ($150 per party for disputes initiated on or after
January 1, 2025, as discussed in section II.E.3.a. of this preamble).
If the initiating party attests that the highest offer made during open
negotiation by either party was less than the threshold, the
administrative fee amount charged to both parties may be the reduced
administrative fee for low-dollar disputes of 50 percent of the
administrative fee. If the initiating party does not attest that the
highest offer (or aggregate offers for a dispute, whether the dispute
is for one item or service, a bundled payment arrangement, or multiple
items and services submitted as part of a batched dispute) made during
open negotiation by either party was less than the threshold, both
parties may be charged the full amount of the proposed administrative
fee.
The Departments seek comment on the proposed administrative fee
structure for low-dollar disputes, including any guardrails that may be
necessary to prevent potential abuse.
[[Page 75800]]
Specifically, the Departments seek comment on capping the offers of
parties to a low-dollar dispute when the reduced administrative fee for
low-dollar disputes applies, such that these parties would be prevented
from submitting an offer above the low-dollar dispute threshold amount
to ensure that parties requesting to pay the reduced administrative fee
actually have disputes that are considered to be low-dollar. The
Departments also seek comment on whether the offer cap should be set at
the same value as the threshold, or whether the offer cap should be
higher than the threshold to allow for some increase between offers
made during open negotiation and offers made during the Federal IDR
process.
f. Administrative Fee Structure for Non-Initiating Parties in
Ineligible Disputes
The Departments are proposing a framework to more equitably
allocate costs between disputing parties while also incentivizing non-
initiating parties to be responsive throughout the Federal IDR process,
especially with respect to challenging the eligibility of a dispute.
The Departments propose in 26 CFR 54.9816-8(d)(2)(iii)(B), 29 CFR
2590.716-8(d)(2)(iii)(B), and 45 CFR 149.510(d)(2)(iii)(B) to charge a
non-initiating party a reduced administrative fee when either the
certified IDR entity or the Departments determine the entire dispute is
ineligible for the Federal IDR process. The Departments also propose in
26 CFR 54.9816-8(d)(2)(iii)(B), 29 CFR 2590.716-8(d)(2)(iii)(B), and 45
CFR 149.510(d)(2)(iii)(B) that the reduced administrative fee amount
for non-initiating parties in ineligible disputes would be 20 percent
of the full administrative fee amount (proposed in section II.E.3.a. of
this preamble), equating to $30 per non-initiating party per dispute if
the administrative fee is finalized as proposed.
For the reasons discussed in section II.D.1. of this preamble,
implementing an efficient Federal IDR process requires both parties to
be active participants in the process. As described in the ``Contested
Dispute Eligibility'' section of the Initial Report on the Federal
Independent Dispute Resolution (IDR) Process, April 15-September 30,
2022,\183\ submission of ineligible and incomplete disputes delays
processing of disputes. The Departments are of the view that charging a
reduced administrative fee to the non-initiating party for an
ineligible dispute would more fairly allocate the costs to the
Departments associated with ineligible disputes by assigning the
majority of those costs to the party best suited to prevent submission
of such disputes--the initiating party. If the Departments determine
either or both parties have not acted in good faith in their
submissions or responses, the Departments may decline to charge a
reduced administrative fee. The Departments solicit comments on
situations in which the Departments should decline to charge the non-
initiating party a reduced administrative fee for an ineligible
dispute, such as if the Departments obtain evidence that the non-
initiating party withheld key information during open negotiation or
initiation that the dispute was ineligible, and the Departments also
solicit comments on additional approaches the Departments should
consider to mitigate potential abuse of the proposed reduced
administrative fee structure.
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\183\ See U.S. Department of Health and Human Services, U.S.
Department of Labor, and U.S. Department of the Treasury, Initial
Report on the Federal Independent Dispute Resolution (IDR) Process,
April 15-September 30, 2022. https://www.cms.gov/files/document/initial-report-idr-april-15-september-30-2022.pdf.
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Additionally, the No Surprises Act requires the administrative fee
to be assessed to each party, but does not require the fee amount
assessed to each party to be equal.\184\ While the non-initiating party
did not actively choose to bring the dispute to the Federal IDR
process, it would nonetheless utilize the features of the Federal IDR
process proposed in these proposed rules, such as open negotiation and
the Federal IDR Registry. However, the Departments are of the view that
payment of a reduced administrative fee amount for non-initiating
parties is appropriate when disputes are not eligible for the Federal
IDR process.
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\184\ See section 9816(c)(8)(A) of the Code, section
716(c)(8)(A) of ERISA, and section 2799A-1(c)(8)(A) of the PHS Act.
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The Departments propose that this reduction would only be applied
when the entire dispute is determined ineligible for the Federal IDR
process. For example, if a batched dispute were determined to be
partially ineligible (that is, some line items were eligible and some
were ineligible), the non-initiating party may still be required to pay
the full administrative fee amount, because the eligible line item(s)
of the dispute would continue to move through the Federal IDR process.
To develop the proposed administrative fee amounts for low-dollar
disputes and ineligible disputes, the Departments considered several
factors. Specifically, compared to ineligible disputes, the Departments
are of the view that charging a higher reduced administrative fee
amount for both parties in low-dollar disputes would be appropriate
because low-dollar disputes generally proceed further in the Federal
IDR process and result in either a payment determination or a
negotiated settlement, and the additional Federal IDR process steps
utilized by the parties incur additional expenses. However, non-
initiating parties in ineligible disputes utilize fewer Federal IDR
process steps because the dispute is closed before reaching a payment
determination. In the event a low-dollar dispute is ineligible, the
non-initiating party may be assessed the lower of the reduced
administrative fee amounts, which would be the ineligible dispute
reduced administrative fee amount. The Departments are of the view that
this would be an equitable structure for both initiating and non-
initiating parties and would help the Departments ensure that the total
amount of administrative fees for each year is estimated to be equal to
the amount of expenditures estimated to be made by the Departments to
carry out the Federal IDR process, in compliance with the requirements
of the No Surprises Act.
To determine the projected amounts of the reduced administrative
fees, the Departments evaluated various factors based on the data
available to the Departments on both ineligible and low-dollar
disputes, including:
Reduction of follow-up required for ineligible disputes;
Lower utilization of the Federal IDR portal for disputes
that are closed as ineligible before a payment determination; and
The proportion of total disputes that are ineligible or
low-dollar.
After evaluating these factors, the Departments balanced the need
to collect an administrative fee from all parties to disputes that
utilize the Federal IDR portal with the need to equitably allocate
burden across the parties, as well as the need to enable greater access
to the Federal IDR process, and determined that assessing a reduced
administrative fee amount of 50 percent of the full administrative fee
for both parties in a low-dollar dispute and 20 percent of the full
administrative fee for the non-initiating party in an ineligible
dispute would be appropriate.
The Departments seek comment on this proposal, including whether
the amount of the reduced administrative fee for non-initiating parties
in ineligible disputes should be the same as the amount of the reduced
administrative fee for both parties in low-dollar disputes discussed in
section II.E.3.e. of this preamble.
[[Page 75801]]
4. Payment Determination
a. Submission of Offers Deadline
Sections 9816(c)(5)(B) and 9817(b)(5)(B) of the Code, sections
716(c)(5)(B) and 717(b)(5)(B) of ERISA, and sections 2799A-1(c)(5)(B)
and 2799A-2(b)(5)(B) of the PHS Act set forth that not later than 10
days after the date of selection of the certified IDR entity with
respect to a determination for a qualified IDR item or service, the
plan or issuer and the provider, facility, or provider of air ambulance
services must each submit to the certified IDR entity an offer for a
payment amount for such qualified IDR item or service. Under the
October 2021 interim final rules, the Departments established that the
offer must be submitted not later than 10 business days after the
selection of the certified IDR entity. The Departments specified that
parties to the Federal IDR process must also submit information
requested by the certified IDR entity relating to the offer.
To establish that the submission of offer is due from the provider,
facility, or provider of air ambulance services and plan or issuer not
later than 10 business days after the date of final selection of the
certified IDR entity, as discussed in section II.E.1.a.ii. of this
preamble, the Departments propose to redesignate 26 CFR 54.9816-
8(c)(4), 29 CFR 2590.716-8(c)(4), and 45 CFR 149.510(c)(4) as 26 CFR
54.9816-8(c)(5), 29 CFR 2590.716-8(c)(5), and 45 CFR 149.510(c)(5) and
amend redesignated 26 CFR 54.9816-8(c)(5)(i), 29 CFR 2590.716-
8(c)(5)(i), and 45 CFR 149.510(c)(5)(i). This proposed amendment would
establish that the time period for submission of offers would commence
when the Departments notify the parties that the certified IDR entity
has attested it has no conflicts of interest, or if the Departments
have granted an extension to the eligibility determination timeframe
described at proposed 26 CFR 54.9816-8(g)(1)(ii)(A), 29 CFR 2590.716-
8(g)(1)(ii)(A), and 45 CFR 149.510(g)(1)(ii)(A) due to extenuating
circumstances, when an eligibility determination has been made.
b. Payment Determination and Notification Deadline
Sections 9816(c)(5)(A) and 9817(b)(5)(A) of the Code, sections
716(c)(5)(A) and 717(b)(5)(A) of ERISA, and sections 2799A-1(c)(5)(A)
and 2799A-2(b)(5)(B) of the PHS Act set forth that not later than 30
days after the date of selection of the certified IDR entity with
respect to a determination for a qualified IDR item or service, the
certified IDR entity will select one of the submitted offers to be the
amount of payment for such item or service and will notify the provider
or facility and the plan or issuer of the offer selected. Under the
October 2021 interim final rules, the Departments established that the
certified IDR entity must select an offer no later than 30 business
days after the selection of the certified IDR entity and set forth
other requirements for certified IDR entities when rendering payment
determinations.
These rules propose to redesignate 26 CFR 54.9816-8(c)(4), 29 CFR
2590.716-8(c)(4), and 45 CFR 149.510(c)(4) as 26 CFR 54.9816-8(c)(5),
29 CFR 2590.716-8(c)(5), and 45 CFR 149.510(c)(5), respectively, and
the proposal described in this section reflects that redesignation.
With regard to the requirements for payment determination and
notification, at redesignated 26 CFR 54.9816-8(c)(5)(ii), 29 CFR
2590.716-8(c)(5)(ii), and 45 CFR 149.510(c)(5)(ii), the Departments
propose several amendments to align with other proposed updates to
regulatory text, to make technical amendments, and to codify existing
subregulatory guidance. The Departments propose to amend the regulatory
text at 26 CFR 54.9816-8(c)(5)(ii), 29 CFR 2590.716-8(c)(5)(ii), and 45
CFR 149.510(c)(5)(ii) to reflect that the payment determination and
notification deadline would be based on the date of final selection of
the certified IDR entity, under proposed paragraph 26 CFR 54.9816-
8(c)(1)(iv)(C), 29 CFR 2590.716-8(c)(1)(iv)(C), and 5 CFR
149.510(c)(1)(iv)(C), which is described further in section
II.E.1.a.ii. of this preamble. Similar to the proposed amendment to the
submission of offers deadline, this proposed amendment would align the
sections of regulatory text and specify that these time periods would
not commence at the date of preliminary selection of the certified IDR
entity (before the certified IDR entity attests it has no conflicts of
interest), but rather would be based on the date of final selection of
the certified IDR entity. Additionally, if the Departments grant an
extension to the eligibility determination timeframe described at
proposed 26 CFR 54.9816-8(g)(1)(ii)(A), 29 CFR 2590.716-8(g)(1)(ii)(A),
and 45 CFR 149.510(g)(1)(ii)(A) for extenuating circumstances, the
submission of offers deadline would be based on the date of eligibility
determination. This would create consistency across the timeframes for
the Federal IDR process described in these rules and improve
implementation of the Federal IDR process.
Further, the Departments propose technical amendments to update the
cross references in paragraphs 26 CFR 54.9816-8(c)(5)(ii)(A) and (B),
29 CFR 2590.716-8(c)(5)(ii)(A) and (B), and 45 CFR 149.510(c)(5)(ii)(A)
and (B) to reflect the proposed redesignation of paragraph 26 CFR
54.9816-8(c)(5), 29 CFR 2590.716-8(c)(5), and 45 CFR 149.510(c)(5).
Within these paragraphs, reference to paragraphs (c)(4)(i) and
(c)(4)(iii) would be updated to paragraphs (c)(5)(i) and (c)(5)(iii),
respectively, and reference to paragraphs (c)(4)(ii)(A) and (c)(4)(vi)
would be updated to paragraphs (c)(5)(ii)(A) and (c)(5)(vi),
respectively.
Finally, the Departments propose to codify definitions for the
prevailing and non-prevailing parties, which were described in the
Calendar Year 2022 Fee Guidance for the Independent Dispute Resolution
Process and in the October 2021 interim final rules. The Departments
propose to add paragraphs 26 CFR 54.9816-8(c)(5)(ii)(A)(1) and (2), 29
CFR 2590.716-8(c)(5)(ii)(A)(1) and (2), and 45 CFR
149.510(c)(5)(ii)(A)(1) and (2), which would establish the definitions
of prevailing and non-prevailing party in the case of single
determinations or batched determinations. The Departments propose that
a prevailing party, in the case of single determinations, would be the
party whose offer is selected by the certified IDR entity. In the case
of batched determinations, the prevailing party would be the party with
the most determinations in its favor. The Departments propose that the
non-prevailing party, in the case of single determinations, would be
the party whose offer is not selected by the certified IDR entity and
would be responsible for paying the certified IDR entity fee. In the
case of batched determinations, the party with the fewest
determinations in its favor is considered the non-prevailing party and
would be responsible for paying the certified IDR entity fee. Codifying
these definitions, already used by the certified IDR entities, would
increase the clarity and consistency of regulatory requirements related
to payment determinations and improve the parties' understanding of
certified IDR entity determinations.
The Departments solicit comment on the proposals related to payment
determination and notification.
5. Extension of Time Periods for Extenuating Circumstances
Under section 9816(c)(9) of the Code, section 716(c)(9) of ERISA,
and section 2799A-1(c)(9) of the PHS Act, and as explained in the
October 2021 interim final rules and subregulatory guidance issued by
the Departments, the time periods required under the No Surprises
[[Page 75802]]
Act and 26 CFR 54.9816-8T, 29 CFR 2590.716-8, and 45 CFR 149.510 (other
than the timing of the payments to prevailing parties) may be modified
in the case of extenuating circumstances at the Departments'
discretion.
Under current regulations,\185\ the Departments may extend time
periods on a case-by-case basis if the extension is necessary to
address delays due to matters beyond the control of the parties or for
good cause, such as due to a natural disaster that prevents certified
IDR entities, providers, facilities, providers of air ambulance
services, plans, or issuers from complying with an applicable time
period. In addition, the parties must attest that prompt action will be
taken to ensure that a payment determination is made as soon as
administratively practicable under the circumstances. As the October
2021 interim final rules explain, parties may request an extension by
submitting a Request for Extension due to Extenuating Circumstances
through the Federal IDR portal, including an explanation about the
extenuating circumstances and why the extension is needed.\186\
However, requesting an extension does not toll any of the Federal IDR
process timeframes unless and until an extension is granted.
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\185\ 26 CFR 54.9816-8T(g)(1), 29 CFR 2590.716-8(g)(1), and 45
CFR 149.510(g)(1).
\186\ 86 FR 56009 through 56010.
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Therefore, under this authority, the Departments propose, in
accordance with sections 9816(c)(9) of the Code, section 716(c)(9) of
ERISA, and section 2799A-1(c)(9) of the PHS Act, to amend and add new
provisions to 26 CFR 54.9816-8(g), 29 CFR 2590.716-8(g), and 45 CFR
149.510(g). The Departments are proposing to amend 26 CFR 54.9816-
8T(g), 29 CFR 2590.716-8(g), and 45 CFR 149.510(g) to combine the
information in existing paragraphs (g)(1)(i) and (g)(1)(ii) into
paragraph (g)(1)(i) and to establish at paragraph (g)(1)(i) that the
Departments, or at the request of a certified IDR entity or a party,
would determine whether an extension is necessary because the parties
or certified IDR entity cannot meet applicable timeframes due to
matters beyond the control of the certified IDR entity or one or both
parties, or for other good cause. Under these proposed rules, the
Departments would provide an extension of the time periods if they
identify unforeseen or good cause delays on a case-by-case basis, as
opposed to solely relying on one of the parties to submit an extension
request. The Departments may detect these issues before either party
would and could immediately grant the necessary extension without
having to wait for the submission of a formal request. Further, these
proposed changes would create greater flexibility for certified IDR
entities. For example, a certified IDR entity may receive a high volume
of disputes that could lead to the certified IDR entity being unable to
resolve payment determinations within the 30-business-day period. With
the proposed changes to 26 CFR 54.9816-8(g)(1)(i), 29 CFR 2590.716-
8(g)(1)(i), and 45 CFR 149.510(g)(1)(i), the certified IDR entity could
submit an extension request for the Departments' consideration. Often,
the certified IDR entity may be best positioned to identify issues that
warrant such an extension on a case-by-case basis.
The Departments also propose to establish at 26 CFR 54.9816-
8(g)(1)(ii), 29 CFR 2590.716-8(g)(1)(ii), and 45 CFR 149.510(g)(1)(ii)
a generally applicable extension of time periods when the Departments
determine that such extension is necessary due to extenuating
circumstances that contribute to systematic delays in processing
disputes under the Federal IDR process, such as a high volume of
disputes or Federal IDR portal system failures. The Departments would
post a public notice about any generally applicable extensions of time
periods. For example, this proposed flexibility would be used, in
addition to the generally applicable permission to toll timeframes
during pending requests for additional information, to provide
extensions when the volume of disputes initiated exceeds the certified
IDR entities' capacity to complete eligibility determinations within
the 5-business-day timeframe proposed in these rules, and to provide
extensions when systematic failures within the Federal IDR portal
impact the parties' and or certified IDR entities' ability to comply
with any of the required timeframes in the Federal IDR process.
Under extenuating circumstances caused by an unforeseen high volume
of disputes, the Departments would grant certified IDR entities an
extension of the eligibility determination timeframe. The amount of
time provided in such an extension would be determined by the
Departments based on the volume of disputes and the number of active
certified IDR entities at the time the extension is granted. An
extension of the eligibility determination deadline, if granted by the
Departments, would not alter the length of the subsequent timeframes in
the Federal IDR process. Rather, the extended eligibility deadline
would be a starting point for the other established IDR deadlines.
Accordingly, the submission of an offer would be due 10 business days
after the extended eligibility determination timeframe and the payment
determination would be due 30 business days after the extended
eligibility determination timeframe, in accordance with the
requirements established in statute and regulation.
For example, if while monitoring IDR initiation data, the
Departments detect a high volume of disputes initiated during the month
of June and anticipate that the volume increase would prevent the
certified IDR entities from reaching a payment determination within 30
business days of final selection of the certified IDR entity, as
required by regulation, the Departments would post a public notice
indicating a 30-business-day extension of the eligibility timeframe for
all disputes in which the certified IDR entity was selected on June 1
through July 1. Rather than the 5-business-day eligibility
determination deadline, certified IDR entities would have 30 business
days to review eligibility on disputes initiated within this time
period. In this example, a certified IDR entity was selected for a
dispute on June 5 and attested to having no conflict of interest with
respect to the dispute on June 6. The Departments would provide notice
to the disputing parties that the certified IDR entity was selected on
June 7, which would be the date of final selection of the certified IDR
entity. The certified IDR entity would timely communicate the
eligibility determination for the dispute by June 20, under the
extension granted by the Departments. The date of eligibility
determination (June 20) would become day 0 for calculating the
remaining deadlines in the timeframe for the IDR process. As such, the
submission of offer would be due from the disputing parties 10 business
days (July 5) after the eligibility determination, and the payment
determination would be due from the certified IDR entity 30 business
days (August 2) after the eligibility determination.
Under a second scenario, when a systematic failure of the Federal
IDR portal impacts parties' or certified IDR entities' ability to
comply with one or more of the required Federal IDR process timeframes,
the Departments would grant the parties and/or the certified IDR
entities an extension to the timeframe(s) which the Departments
determine relevant. An extension under these circumstances would not
alter the duration of the subsequent timeframes within the Federal IDR
process, but, similar to the extension of eligibility determinations,
would update the start dates of the subsequent timeframes. For example,
if a systems failure crashed the
[[Page 75803]]
Federal IDR portal on June 1 and 2, the Departments could grant a
general extension across all the Federal IDR process timeframes and
apply an additional 2 business days to each relevant deadline on active
disputes in the portal. In this example, if a non-initiating party's
deadline to submit the notice of IDR initiation response occurred
during the portal outage, they would receive a 2-business-day extension
beginning the day that the systems failure is rectified. The party's
new deadline for submitting the notice of IDR initiation response would
be June 6.
Under these proposed changes the Departments would extend the time
periods under the Federal IDR process without requiring a case-by-case
analysis of individual extension requests. The Departments are of the
view that granting certain extensions in this manner would provide
protection for parties engaged in the Federal IDR process from the
impact of systematic processing delays and ensure that unforeseen
circumstances do not unfairly disadvantage a party or hinder its
ability to comply with the Federal IDR process timeframes. This would
also provide more transparency into the timing it would take for a
dispute to be processed.
The Departments seek comment on these proposals.
F. Federal IDR Process Registration of Group Health Plans, Health
Insurance Issuers, and Federal Employees Health Benefits Carriers
The proposed addition of 26 CFR 54.9816-9, 29 CFR 2590.716-9, and
45 CFR 149.530 would require that plans and issuers subject to the
Federal IDR process submit certain information to the Departments
through a registry. As explained later in section IV., OPM's
regulations at 5 CFR 890.114 would require Federal Employees Health
Benefits (FEHB) Program carriers to submit certain information through
this registry. Upon submission of this information, each plan, issuer,
or FEHB carrier would receive an IDR registration number
(``registration number''). This registration number would make it
easier for parties initiating disputes to acquire the information
needed to ensure those disputes are eligible for the Federal IDR
process. The registration number would help parties distinguish between
different types of coverage (such as distinguishing between insurance
coverage offered by an issuer, a self-insured group health plan for
which an issuer serves as a TPA, or coverage offered by a FEHB
carrier). The registry would be searchable, and parties would have
access to the relevant registration number through the disclosure
described in proposed 26 CFR 54.9816-6(d), 29 CFR 2590.716-6(d), and 45
CFR 149.140(d), the notice described in proposed 26 CFR 54.9816-
8(b)(1)(ii), 29 CFR 2590.716-8(b)(1)(ii), and 45 CFR 149.510(b)(1)(ii),
and the response notice in proposed 26 CFR 54.9816-8(b)(1)(iii), 29 CFR
2590.716-8(b)(1)(iii), and 45 CFR 149.510(b)(1)(iii). Specifically,
plans, issuers, and FEHB carriers would be required to provide the
following information upon registration: (1) the legal business name
(if any) of the group health plan, issuer, or FEHB carrier and, if
applicable, the legal business name of the group health plan sponsor;
(2) whether the plan or coverage is a self- or fully-insured group
health plan subject to ERISA, individual health insurance coverage, a
plan offered by a FEHB carrier, a self- or fully-insured non-Federal
governmental plan, or a self- or fully-insured church plan; (3) the
State(s) in which the plan or coverage is subject to a specified State
law for any items or services to which the protections against balance
billing apply; (4) the State(s) in which the plan or coverage is
subject to an All Payer Model Agreement under section 1115A of the
Social Security Act for any items or services to which the protections
against balance billing apply; (5) for self-insured group health plans
not otherwise subject to State law, any State(s) in which the group
health plan has properly effectuated an election to opt in to a
specified State law, if that State allows a plan not otherwise subject
to the State law to opt in; and, for FEHB plans that adopt a specified
State law pursuant to their FEHB carrier's contract terms, any State(s)
in which they have made such an adoption; (6) contact information,
including a telephone number and email address, for the appropriate
person or office to initiate open negotiations for purposes of
determining an amount of payment (including cost sharing) for such item
or service; (7) the 14-digit Health Insurance Oversight System (HIOS)
identifier, or, if the 14-digit HIOS identifier has not been assigned,
the 5-digit HIOS identifier, or if no HIOS identifier is available, the
plan's or the plan sponsor's Employer Identification Number (EIN) and
the plan's plan number (PN), if a PN is available; or for FEHB
carriers, the applicable contract number(s) and plan code(s); (8) any
additional information needed to identify the plan or issuer and the
applicable Federal and State requirements for determining appropriate
out-of-network payment rates for items or services to which the
protections against balance billing apply, as specified by the
Departments in guidance, or such additional information needed with
respect to FEHB carriers as specified by OPM in guidance; and (9) any
additional information needed for purposes of administrative fee
collection, as specified by the Departments in guidance, or such
additional information needed with respect to FEHB carriers as
specified by OPM in guidance.
The Departments would gather the registration information in a
centralized IDR registry, which the Departments would make available
through the Federal IDR portal to parties seeking to initiate an open
negotiation or a dispute. The Departments solicit comment on whether to
also make the registry available to the public.
Plans and issuers with coverage subject to the Federal IDR process
on the effective date of the final rules would be required to register
within 30 business days after the effective date of the final rules, if
finalized, while plans and issuers that begin offering coverage subject
to the Federal IDR process after the effective date of the final rules,
if finalized, would be required to complete their initial registration
on the date that they begin offering such coverage. In the event that
the registry becomes available after the effective date of the final
rule, plans and issuers would be required to register 30 business days
after the registry becomes available. Registered plans and issuers
would be required to update the information associated with their
Federal IDR registration number through the Federal IDR portal within
30 business days of any change to the information reported in the
registry and to confirm accuracy annually during the fourth quarter of
each calendar year. A group health plan's or health insurance issuer's
initial registration and subsequent updates to its registration
information could be completed and submitted by a third party with
authority to act on behalf of the group health plan or health insurance
issuer. However, if a group health plan or health insurance issuer
chooses to enter into such an agreement with a third party, the plan or
issuer would retain responsibility for compliance with the proposed
registration requirements.
The Departments solicit comment on whether plans and issuers with
coverage subject to the Federal IDR process on the effective date of
the final rules would be able to register by 30 business days after the
effective date of the final
[[Page 75804]]
rules or would need additional time to register. The Departments also
solicit comment on the potential impact on providers, facilities, and
providers of air ambulance services if plans and issuers are permitted
additional time to register.
In addition, the Departments are aware that plans and issuers often
engage TPAs or other service providers to manage payment disputes
subject to the Federal IDR process on their behalf. Accordingly, to
reflect this existing industry practice, the Departments propose that
the aforementioned requirements with respect to the registry under
proposed 26 CFR 54.9816-9(b)(1)-(3), 29 CFR 2590.716-9(b)(1)-(3), and
45 CFR 149.530(b)(1)-(3) may be performed by a TPA or service provider
with authority to act on behalf of the group health plan or health
insurance issuer offering group or individual health insurance coverage
subject to the Federal IDR process. The Departments propose that if the
registration requirements are performed by such TPA or service
provider, the group health plan or health insurance issuer offering
group or individual health insurance coverage must require that such
TPA or service provider clearly delineate each group health plan or
health insurance issuer offering group or individual health insurance
coverage for which the TPA or service provider has authority to act.
Even where a third party performs the registration requirements, these
proposed rules would still require that each group health plan or
health insurance issuer offering group or individual health insurance
coverage subject to the Federal IDR process be assigned a unique
registration number. The Departments also propose to make clear that if
such third party fails to provide the information in compliance with
proposed 26 CFR 54.9816-9(b)(1)-(3), 29 CFR 2590.716-9(b)(1)-(3), and
45 CFR 149.530(b)(1)-(3), the plan or issuer would be in violation of
the requirements of this section. The Departments solicit comments on
this approach and whether there are any additional clarifications or
flexibilities needed to ensure that the registry includes all relevant
information for all parties that engage in the Federal IDR process.
Proposed 26 CFR 54.9816-9, 29 CFR 2590.716-9, and 45 CFR 149.530
are intended to address concerns that providers, facilities, and
providers of air ambulance services shared with the Departments about
initiating both open negotiation and the Federal IDR process.
Initiating parties, particularly those that are providers, facilities,
and providers of air ambulance services, report that they are often
missing or cannot locate key information needed for open negotiation
and the Federal IDR process despite the disclosure requirements
established in sections 26 CFR 54.9816-6T(d)(1), 29 CFR 2590.716-
6(d)(1), and 45 CFR 149.140(d)(1). First, the parties report difficulty
finding the appropriate contact information to initiate open
negotiation and the Federal IDR process. Second, they report difficulty
determining whether the out-of-network rate for applicable items or
services is governed by State or Federal law, including whether a self-
insured plan has opted into a specified State law in States that allow
these opt-ins. Third, they assert that it can be difficult to
differentiate between multiple group health plans offered by the same
plan sponsor, as well as between a fully-insured plan offered by an
issuer versus a self-insured group health plan administered by that
issuer in its capacity as a TPA. Likewise, issuers and group health
plan sponsors expressed concerns to the Departments that providers,
facilities, and providers of air ambulance services sometimes initiate
open negotiations or the Federal IDR process using incorrect contact
information, or even initiate negotiations against the wrong plan or
issuer. These communication difficulties present problems related to:
(1) initiating open negotiation and the Federal IDR process with the
correct party; (2) determining whether the items or services are
eligible for the Federal IDR process; and (3) initiating correctly
batched and bundled disputes that group together only items and
services paid by the same plan or issuer.
Given these concerns, the Departments are proposing to create a
single registry of plans and issuers subject to the Federal IDR process
to foster better communication between disputing parties. These changes
would benefit all parties by reducing the need for time-consuming and
expensive follow-up by disputing parties, certified IDR entities, and
the Departments to obtain necessary information.
The Departments recognize that plans and issuers have expressed
concern about the burden of additional required disclosures. However,
while plans and issuers would incur some additional administrative
burden from providing plan and contact information through mandatory
registration, the Departments are of the view that this approach also
mitigates some administrative burden if the registry reduces the number
of incorrectly submitted or incorrectly batched disputes.
The Departments seek to minimize burden and ease compliance for
plans and issuers by avoiding the issuance of duplicate registration
numbers for the same plan or a single registration number for multiple
plans. OPM similarly seeks to resolve concerns as discussed above,
minimize burden and ease compliance for FEHB carriers. To that end, the
Departments seek comment on the best way to separately identify
multiple group health plans offered by the same plan sponsor, or
multiple FEHB plans offered by the same FEHB carrier, and whether
plans, issuers, or FEHB carriers would need to register multiple points
of contact in their submissions to the IDR registry.
To further minimize the reporting burden on plans, issuers, and
FEHB carriers, the Departments are considering and solicit comment on
whether to require plans, issuers, and FEHB carriers to register only
after submitting or receiving their first open negotiation notice or
only after receiving a certain number of disputes in a calendar year
(for example, five disputes). Many group health plans are party to few,
or no surprise billing disputes annually; excepting such parties from
the registration requirement may minimize the regulatory burden on
group health plans that receive few or no surprise billing disputes in
a given year and could keep the registry size manageable. However, if
registration is not universal, providers, facilities, and providers of
air ambulance services may still experience difficulty accessing all
information needed to initiate open negotiation and engage in the
Federal IDR process with the subset of plans and issuers that would not
be required to register.
The Departments expect that providers, facilities, and providers of
air ambulance services would make decisions about how and whether to
initiate batched disputes based on the information submitted to the
registry. The Departments, therefore, are considering and solicit
comment on appropriate measures to address circumstances in which a
provider or facility initiates a batched dispute in good faith based on
information submitted by a plan or issuer as part of its registration
and this dispute is later determined to be incorrectly batched.
Finally, the Departments seek comment on this registration policy
and what approaches should be adopted to ensure its accuracy, as well
as whether submission of the offer as described in newly redesignated
26 CFR 54.9816-8(c)(5)(i), 29 CFR 2590.716-8(c)(5)(i), and 45 CFR
149.510(c)(5)(i) should be restricted until completion of the proposed
registration.
[[Page 75805]]
G. Transparency Regarding In-Network and Out-of-Network Deductibles and
Out-of-Pocket Limitation
In addition to the challenges discussed previously, some interested
parties have stated that it is difficult to know at the point of care
whether a patient's plan or coverage is subject to Federal or State
surprise billing protections. In general, section 9816(e) of the Code,
section 716(e) of ERISA, and section 2799A-1(e) of the PHS Act, as
added by section 107 of division BB of the CAA, require a group health
plan or a health insurance issuer offering group or individual health
insurance coverage and providing or covering any benefit with respect
to items or services to include, in clear writing, on any physical or
electronic plan or insurance ID card issued to participants,
beneficiaries, or enrollees, any applicable deductibles, any applicable
out-of-pocket maximum limitations, and a telephone number and website
address for individuals to seek consumer assistance information, such
as information related to in-network hospitals and urgent care
facilities. The Departments are considering, under the general
rulemaking authority granted to the Departments to establish the
Federal IDR process under section 9816(c)(2)(A) of the Code, section
716(c)(2)(A) of ERISA, and section 2799A-1(c)(2)(A) of the PHS Act,
whether requiring that each plan or insurance card include information
about whether the individual's plan or coverage is subject to Federal
or State surprise billing protections would facilitate information
sharing with respect to the Federal IDR process. The Departments
acknowledge that the ID cards may not be able to clarify the
applicability of the Federal IDR process in all contexts, because in
some States the Federal protections will apply for some items,
services, and providers, while the State protections will apply for
others. The Departments seek comment on this potential approach,
including whether ID cards should display the plan or coverage type
(such as, self-insured or fully-insured ERISA plan, non-Federal
governmental plan, church plan, FEHB plan, or individual health
insurance coverage), as well as whether a symbol or code could be
included on cards that would indicate the applicable regulatory
authority of the plan or coverage (that is, State or Federal entity, or
both).
H. Applicability
1. Applicability Dates
These proposed rules would modify and add to certain provisions of
the July 2021 and October 2021 interim final rules. Those interim final
rules generally became applicable for plan years (in the individual
market, policy years) beginning on or after January 1, 2022.
The provision proposed in 26 CFR 54.9816-3, 29 CFR 2590.716-3, and
45 CFR 149.30 to add the definition of bundled payment arrangement
would apply beginning on the effective date of the final rules. These
proposed rules would codify the existing definition set forth in
guidance and would not require providers, facilities, providers of air
ambulance services, plans, issuers, or certified IDR entities to modify
existing processes or their own portals or systems to align with the
proposed definition. Therefore, it would be appropriate for this
definition to become applicable immediately upon the effective date of
the final rules, if finalized.
The provision in proposed new 26 CFR 54.9816-6A, 29 CFR 2590.716-
6A, and 45 CFR 149.100 that plans and issuers communicate information
using CARCs and RARCs, as specified in guidance, would apply beginning
on the effective date of the final rules, if finalized. The Departments
would issue future guidance on the use of CARCs and RARCs in both
electronic transactions and formats outside the purview of the HIPAA
transaction standards, including paper remittance advice, to implement
this proposed regulatory requirement. Should this proposal be
finalized, the Departments recognize that plans and issuers would need
time to make systems changes and other modifications to operationalize
the use of CARCs and RARCs and are considering an approach under which
the final rules would establish the implementation timeframe for the
use of CARCs and RARCs following the issuance of guidance. For example,
the final rules could specify that the requirement to use a specified
CARC or RARC applies beginning on the date that is a certain timeframe,
such as 6 months or 1 year, after the issuance of guidance.
Alternatively, the final rules could provide that guidance issued by
the Departments would establish an interval of not less than, for
example, 6 months between when guidance is issued and when plans and
issuers must begin using a specified CARC or RARC. This would balance
plans' and issuers' interest in certainty in a minimum implementation
timeframe while allowing for flexibility where the Departments
determine necessary. The Departments seek comments on these potential
approaches, including what timeframe would provide plans and issuers
sufficient time to comply.
The proposed modifications to the regulations at 26 CFR 54.9816-
6(d), 29 CFR 2590.716-6(d), and 45 CFR 149.140(d) addressing
information to be shared about the QPA would apply to disclosures
required to be provided on or after the effective date of the final
rules, if finalized. The Departments note that many of these proposed
changes are simply corrections or clarifications that would not
substantially affect current plan or issuer operations. While these
disclosures would be required to include some new content--namely a
statement that a provider, facility, or provider of air ambulance
services must notify the Departments when initiating open negotiation,
the legal business name of the plan and plan sponsor (if applicable)
and issuer, and the registration number assigned under these proposed
rules--the Departments do not anticipate significant operational burden
for plans and issuers to modify existing processes to include this
information. The proposed regulatory text makes clear that plans and
issuers would not be required to include a statement about notifying
the Departments to initiate open negotiation until the open negotiation
notice can be submitted through the Federal IDR portal. Further, plans
and issuers would not be required to include their assigned
registration number until the Federal IDR registry becomes available
and the plan or issuer is registered.
The proposed modifications to the Federal IDR process that would
apply to disputes with open negotiation periods beginning on or after
the later of August 15, 2024, or 90 days after the effective date of
the final rules, if finalized, include:
The requirements for batched qualified IDR items and
services in 26 CFR 54.9816-8(a)(2)(i), 29 CFR 2590.716-8(a)(2)(i) and
45 CFR 149.510(a)(2)(i);
The provisions regarding the open negotiation notice, open
negotiation response notice, notice of IDR initiation, and notice of
IDR initiation response in 26 CFR 54.9816-8(b), 29 CFR 2590.716-8(b)
and 45 CFR 149.510(b);
The proposed rules governing the selection of a certified
IDR entity, the Federal IDR process eligibility review, the authority
to continue negotiations or withdraw, and the treatment of batched and
bundled qualified IDR items and services in 26 CFR 54.9816-8(b) and
(c)(1) through (c)(4), 29 CFR 2590.716-8(b) and (c)(1) through (c)(4),
and 45 CFR 149.510(b) and (c)(1) through (c)(4); and
Modifications made to the deadline for the submission of
offers and payment determination and notification
[[Page 75806]]
in 26 CFR 54.9816-8(c)(5)(i) and (ii), 29 CFR 2590.716-8(c)(5)(i) and
(ii), and 45 CFR 149.510(c)(5)(i) and (ii); and
Modifications made to the suspension of certain subsequent
IDR requests and subsequent submission of requests submitted in 26 CFR
54.9816-8(c)(5)(vii)(B) and (C), 29 CFR 2590.716-8(c)(5)(vii)(B) and
(C), and 45 CFR 149.510(c)(5)(vii)(B) and (C).
The Departments recognize that each of these proposed changes would
require providers, facilities, providers of air ambulance services,
plans, issuers, and certified IDR entities to modify existing processes
and their own portals or systems to align with the proposed
requirements. For example, some certified IDR entities may need to
update their own proprietary portals used to facilitate their
eligibility and payment determinations to align with the new batching
requirements. Further, the Departments would need to design and
implement system changes to the Federal IDR portal, such as allowing
the disputing parties to submit new and updated notices through the
Federal IDR portal and updating the system's collection of newly
permissible batched disputes. This proposed applicability date is
intended to ensure the Departments, disputing parties, and certified
IDR entities have sufficient time to understand the proposed changes to
the Federal IDR process and modify current operations.
The proposed modifications to the regulations at 26 CFR 54.9816-
8(d), 29 CFR 2590.716-8(d), and 45 CFR 149.510(d) addressing the time
and manner of payment and collection of the administrative and
certified IDR entity fees, the procedures in the event that either
party fails to timely pay the administrative or certified IDR entity
fee, and the framework for establishing the administrative and
certified IDR entity fee structures would apply to disputes initiated
on or after January 1, 2025. Similar to the proposed open negotiation,
IDR initiation, and batched determination requirements, the Departments
would need sufficient time to modify current operations so that the
Departments could charge and collect the administrative fees directly
from the parties, which are currently collected by the certified IDR
entities and subsequently remitted to the Departments. The Departments
would also need to update their payment systems and the Federal IDR
portal to implement the proposed consequences when either party fails
to pay the certified IDR entity fee or the administrative fee, such as
the proposals to close a dispute when the initiating party fails to pay
the administrative fee on time and to prohibit the non-initiating party
from submitting an offer when the non-initiating party fails to pay the
administrative fee or certified IDR entity fee in accordance with the
proposed timeframes.
The proposed changes at 26 CFR 54.9816-8(e)(2)(vi), (viii), and
(ix), 29 CFR 2590.716-8(e)(2)(vi), (viii), and (ix), and 45 CFR
149.510(e)(2)(vi), (viii), and (ix) regarding the certified IDR
entity's controls to prevent and detect improper financial activities,
and procedures to retain the certified IDR entity fee and
administrative fee are minor in nature, and therefore these proposed
rules would be applicable upon the effective date of the final rules,
if finalized.
The proposed changes at 26 CFR 54.9816-8(g), 29 CFR 2590.716-8(g),
and 45 CFR 149.510(g) regarding the extension of time periods for
extenuating circumstances would be applicable to disputes with open
negotiation periods beginning on or after the later of August 15, 2024,
or 90 days after the effective date of the final rules, if finalized.
Until the relevant applicability date for the requirements of 26
CFR 54.9816-8, 29 CFR 2590.716-8, and 45 CFR 149.510, plans, issuers,
providers, facilities, providers of air ambulance services, and
certified IDR entities are required to continue to comply with the
corresponding section of 26 CFR 54.9816-8, 29 CFR 2590.716-8, and 45
CFR 149.510, contained in the CFR as of October 25, 2022. In order to
ensure compliance with these proposed requirements, the Departments
would generally use existing processes for enforcing the relevant
provisions of the Code, ERISA, and PHS Act that apply to group health
plans and health insurance issuers, including the provisions added by
the No Surprises Act.\187\ The Departments intend to monitor for non-
compliance with these proposed requirements when applicable, if
finalized.
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\187\ See Section 504 of ERISA (providing DOL with authority to
determine whether any person has violated or is about to violate any
provision of ERISA or any regulation or order thereunder, including
with regard to group health plans); section 2723 of the PHS Act and
45 CFR 150.101 et seq. (setting forth HHS's enforcement procedures
related to the provisions of title XXVII of the PHS Act, including
bases for initiating investigations and performing market conduct
examinations). For an overview of applicable enforcement mechanisms,
see also Staman, Jennifer (2020). ``Federal Private Health Insurance
Market Reforms: Legal Framework and Enforcement,'' Congressional
Research Service, available at https://crsreports.congress.gov/product/pdf/R/R46637.
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Finally, provisions that would establish the Federal IDR registry,
and the associated requirements at proposed 26 CFR 54.9816-9, 29 CFR
2590.716-9, and 45 CFR 145.530 would become applicable on the effective
date of the final rules, if finalized. Pursuant to the establishment of
the registry, the requirements in proposed new 26 CFR 54.9816-9, 29 CFR
2590.716-9, and 45 CFR 145.530 would require that each plan or issuer
subject to the Federal IDR process complete its initial registration in
the newly established Federal IDR registry by the later of the date
that is 30 business days after the registry becomes available or the
date the group health plan or health insurance issuer begins offering
group or individual health insurance coverage.
The Departments seek comment on whether disputing parties and
certified IDR entities would need additional time to implement the
proposed modifications after the final rules are published, if
finalized.
2. Applicability of Surprise Billing Protections to Ground Ambulance
Services
The Departments have received questions about how the surprise
billing protections under the No Surprises Act apply to ground
ambulance services. In particular, the Departments understand that some
plans and issuers have construed a statement in the preamble to the
July 2021 interim final rules addressing when a participant,
beneficiary, or enrollee is in a condition to receive notice and
provide consent to waive surprise billing protections for post-
stabilization services \188\ to mean that the No Surprises Act surprise
billing protections apply to post-stabilization inter-facility ground
ambulance transports. The Departments do not interpret the No Surprises
Act's surprise billing provisions to apply to emergency or non-
emergency ground ambulance services.\189\ This includes transport by
ground ambulance after a participant, beneficiary, or enrollee has been
stabilized and needs to be
[[Page 75807]]
transferred to another facility for continued observation or
treatment.\190\ Instead, Congress enacted section 117 of the No
Surprises Act, which requires the Departments to establish and convene
an advisory committee for the purpose of reviewing options to improve
the disclosure of charges and fees for ground ambulance services,
better inform consumers of insurance options for such services, and
protect consumers from balance billing. The advisory committee must
submit a report that includes recommendations for the disclosure of
charges and fees for ground ambulance services and insurance coverage,
consumer protections and enforcement authorities of the Departments and
States, and the prevention of balance billing to consumers.\191\
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\188\ The preamble to the July 2021 interim final rules states,
``In contrast to situations where a participant, beneficiary, or
enrollee is able to travel using nonmedical transportation or
nonemergency medical transportation following stabilization, in the
event that the individual requires medical transportation to travel,
including transportation by either ground or air ambulance vehicle,
the individual is not in a condition to receive notice or provide
consent. Therefore, the surprise billing protections continue to
apply to post-stabilization services provided in connection with the
visit for which the individual received emergency services.'' 86 FR
36872, 36881 (July 13, 2021).
\189\ Beginning in 2025, the President's Fiscal Year 2024 budget
proposal extends surprise billing protections to ground ambulance
services across the commercial market. See U.S. Department of Health
and Human Services. Fiscal Year 2024 Budget in Brief, (2023), p.99,
available at https://www.hhs.gov/sites/default/files/fy-2024-budget-in-brief.pdf.
\190\ In contrast, if a plan or issuer provides or covers
benefits for air ambulance services (such as inter-facility air
ambulance transports), those services are subject the No Surprises
Act surprise billing protections. See FAQs about Affordable Care Act
and Consolidated Appropriations Act, 2021 Implementation Part 55, Q7
(Aug. 19, 2022), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/aca-part-55.pdf and https://www.cms.gov/files/document/faqs-part-55.pdf.
\191\ For more information about the Advisory Committee on
Ground Ambulance and Patient Billing, see https://www.cms.gov/regulations-guidance/advisory-committees/advisory-committee-ground-ambulance-and-patient-billing-gapb.
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III. Severability
It is the Departments' intent that if any provision of these
proposed rules, if finalized, is held to be invalid or unenforceable by
its terms, or as applied to any person or circumstance, these rules
shall be construed so as to continue to give maximum effect to these
rules as permitted by law, unless the holding shall be one of utter
invalidity or unenforceability. In the event a provision is found to be
utterly invalid or unenforceable, the provision shall be severable from
these proposed rules as finalized, as well as the interim final rules
and final rules they amend and shall not affect the remainder thereof
or the application of the provision to persons not similarly situated
or to dissimilar circumstances.
According to the statute,\192\ the Departments must establish a
Federal IDR process that plans and issuers and nonparticipating
providers and facilities may utilize to resolve certain disputes
regarding out-of-network rates under section 9816 of the Code, section
716 of ERISA, and section 2799A-1 of the PHS Act, including the time,
manner, and amount each party to a determination must pay to
participate in the Federal IDR process. Further, under section
9816(a)(2)(B)(ii) of the Code, section 716(a)(2)(B)(ii) of ERISA, and
section 2799A-1(a)(2)(B)(ii) of the PHS Act, the Departments have
authority to establish through rulemaking the information that a plan
or issuer must share with a provider or facility when determining the
QPA, including the form and manner of such disclosures. Under section
9816(c)(9) of the Code, section 716(c)(9) of ERISA, and section 2799A-
1(c)(9) of the PHS Act, the Departments also may, at their discretion,
modify any deadline or other timing requirement of the Federal IDR
process (except for the timing of payment following a payment
determination) in cases of extenuating circumstances, as specified by
the Departments, or to ensure that all claims that are subject to the
90-calendar-day cooling-off period submitted to the Federal IDR process
are in fact eligible for the Federal IDR process.
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\192\ Sections 9816(c)(2)(A) and 9817(b)(2)(A) of the Code,
sections 716(c)(2)(A) and 717(b)(2)(A) of ERISA, and sections 2799A-
1(c)(2)(A) and 2799A-2(b)(2)(A) of the PHS Act.
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For the reasons described in section II. of this preamble, the
Departments are of the view that their authority to implement each of
these aspects in the proposed regulation is well-supported in law and
practice and should be upheld in any legal challenge. The Departments
are also of the view that the exercise of their authority reflects
sound policy. However, if any portion of these proposed rules is
declared invalid, the Departments intend that the various aspects
related to the Federal IDR process be severable. For example, if a
court were to find unlawful (1) the requirement to use CARC and RARCs,
(2) the standards for the open negotiation period, (3) the provision
for the treatment of batched determinations, (4) the provision for
departmental eligibility review, (5) the administrative fee
requirements, or (6) the provision of extensions of timeframes under
extenuating circumstances, or some combination thereof, the Departments
still would intend the remaining features of the policy to stand.
Further, the Departments also intend for parts of certain provisions in
these rules to be severable. For example, if a court were to find
unlawful (1) the policy of batching qualified IDR items and services
furnished to a single patient on the same or consecutive dates of
service and billed on the same claim form (single patient encounter),
(2) the policy of batching qualified IDR items and services billed
under the same service code or a comparable code under a different
procedural coding system, or (3) the policy of batching anesthesiology,
radiology, pathology, and laboratory qualified IDR items and services
under service codes belonging to the same Category I CPT code section,
or some combination thereof, the Departments still would intend the
remaining features of the policy to stand.
While the proposed policies in combination in these proposed rules
would ameliorate different difficulties in the Federal IDR process and
result in a more efficient and transparent process for the disputing
parties and certified IDR entities, the Departments intend for each of
the proposed policies to function independently and be severable from
another. The Departments have added severability clauses to these
proposed rules to emphasize the Departments' intent that, to the extent
a reviewing court holds that any provision of the final rules is
unlawful, the remaining rules should take effect and be given the
maximum effect permitted by law. The Departments have also added
severability clauses to these proposed rules to emphasize the
Departments' intent that the provisions in 26 CFR 54.9816-6A, 54.9816-
6, 54.9816-8, and 54.9816-9; 29 CFR 2590.716-6A, 2590.716-6, 2590.716-
8, and 2590.716-9; and 45 CFR 149.100, 149.140, 149.510 and 149.530 are
intended to be severable from one another.
The proposed severability provisions in these rules, if finalized,
would not conflict with the proposed severability provisions in the IDR
Process Fees proposed rules, if those provisions are finalized. In the
IDR Process Fees proposed rules the Departments proposed severability
provisions in new proposed paragraphs 26 CFR 54.9816-8(d)(3)(i) and
(ii), 29 CFR 2590.716-8(d)(3)(i) and (ii), and 45 CFR 149.510(d)(3)(i)
and (ii). Those proposed paragraphs state that if any of the
administrative fee or certified IDR entity fee proposals in the IDR
Process Fees proposed rules, as finalized, are held to be unlawful by a
court, the remaining rules should take effect and be given the maximum
effect permitted by law.
If the severability provisions proposed in the IDR Process Fees
proposed rules are finalized and subsequently, the severability
provisions proposed in these rules in new proposed paragraphs 26 CFR
54.9816-8(i)(1) and (2), 29 CFR 2590.716-8(i)(1) and (2), and 45 CFR
149.510(i)(1) and (2) are also finalized, the Departments would remove
the severability provisions proposed in the IDR Process Fees proposed
rules at 26 CFR 54.9816-8(d)(3)(i) and (ii), 29 CFR 2590.716-8(d)(3)(i)
and (ii), and 45 CFR 149.510(d)(3)(i) and (ii).The purpose for this
proposed approach would be to
[[Page 75808]]
simplify the Federal IDR process regulations and have one regulation
section for the severability provisions applicable to the entire
Federal IDR process, as proposed 26 CFR 54.9816-8(i)(1) and (2), 29 CFR
2590.716-8(i)(1) and (2), and 45 CFR 149.510(i)(1) and (2).
IV. Overview of the Proposed Rules--Office of Personnel Management
OPM proposes to amend existing 5 CFR 890.114(a) to include
references to the Departments' regulations.\193\ OPM has the
responsibility of administering the Federal Employees Health Benefits
(FEHB) Program. This responsibility includes maintaining oversight and
enforcement authority for FEHB plans, which are Federal governmental
plans. In the July and October 2021 interim final rules, OPM adopted
the Departments' regulations that implement the sections of the Code,
ERISA, and the PHS Act that are referenced in 5 U.S.C. 8902(p).
Generally, under 5 U.S.C. 8902(p), each FEHB contract must require a
carrier to comply with requirements described in the Code, ERISA, and
PHS Act in the same manner as they apply to a group health plan or
health insurance issuer.
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\193\ OPM also proposes a technical correction in 5 CFR 890.114
that would add a cross-reference to 26 CFR 54.9817-2, which concerns
the independent dispute resolution process for air ambulance
services. The addition of this cross-reference is necessary because
5 CFR 890.114 also cites to parallel provisions at 29 CFR 2590.717-2
and 45 CFR 149.520.
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Subject to OPM regulations and contract provisions, FEHB carriers
must comply with the specified provisions of the Departments'
regulations. The proposed amendments to 5 CFR 890.114 would allow for
continued conformity, oversight, and enforcement. Specifically, through
5 CFR 890.114 and its proposed amendments, FEHB carriers and their
plans would be required to comply with all provisions of these proposed
rules. Among other things, FEHB carriers would be required to:
Comply with the proposed rules' new requirements relating
to the disclosure of information that FEHB carriers must include along
with the initial payment or notice of denial of payment for certain
items and services subject to the surprise billing protections in the
No Surprises Act;
Communicate information by using CARCs and RARCs when
providing any paper or electronic remittance advice to an entity that
does not have a contractual relationship with the FEHB carrier;
Comply with amended requirements related to the open
negotiation period preceding the Federal IDR process, the initiation of
the Federal IDR process, the Federal IDR dispute eligibility review,
and the payment and collection of administrative fees;
Comply with amended requirements related to the extension
of timeframes due to extenuating circumstances, batched items and
services, and bundled payment arrangements; and
Register in the Federal IDR portal established by the
Departments and provide the required data elements as applicable to
FEHB carriers.
V. Economic Impact and Paperwork Burden
A. Summary--Departments of Health and Human Services and Labor
These proposed rules would add new 26 CFR 54.9816-6A, 29 CFR
2590.716-6A, and 45 CFR 149.100 requiring plans and issuers to use
CARCs and RARCs, as specified in guidance issued by the Departments, or
as required under any applicable, adopted standards and operating rules
under 45 CFR part 162, on both electronic and paper remittance advice,
to communicate information related to whether a claim for an item or
service furnished by an entity that does not have a direct or indirect
contractual relationship with the plan or issuer for the furnishing of
such item or service under the plan or coverage is subject to the
provisions of 26 CFR 54.9816 and 54.9817; 29 CFR 2590.716 and 2590.717;
or 45 CFR part 149, subpart B, E, or F. The Departments further propose
amendments to existing regulations to specify that plans and issuers
must, in the case of air ambulance services, disclose the QPA and
certain information about the QPA when cost sharing is calculated using
the QPA. These proposed changes would reflect that the term
``recognized amount'' is not used with respect to air ambulance
services and make technical corrections to address omissions where
providers of air ambulances were not listed alongside other providers
and facilities in the current regulatory text.
The Departments also propose to revise the regulation addressing
information to be shared about the QPA to make clear these disclosures
are required when the recognized amount (or for air ambulance services,
the amount on which cost sharing is based) is the QPA or the amount
billed by the provider, facility, or provider of air ambulance
services.
The Departments also propose amendments to the content of the
statement required under the regulations regarding the information to
be shared about the QPA. Specifically, the Departments propose that the
required statement specify that the 30-day period for open negotiation
is 30 business days; reference providers of air ambulance services (in
addition to providers and facilities); specify that a party wishing to
initiate open negotiation must provide the required notice within 30
business days of receiving an initial payment or notice of denial of
payment; and include language notifying the provider, facility, or
provider of air ambulance services that they must notify the
Departments and the plan or issuer to initiate the open negotiation
period.\194\ The Departments also propose to require plans and issuers
to disclose the legal business name of the plan (if any) or issuer; the
legal business name of the plan sponsor (if applicable); and the
registration number assigned under proposed 26 CFR 54.9816-9, 29 CFR
2590.716-9, or 45 CFR 149.530, as applicable, if the plan or issuer is
registered with the Federal IDR registry.
---------------------------------------------------------------------------
\194\ For a description of the proposal to require parties to
notify the Departments when they initiate open negotiation, see
section II.D.1. of this preamble.
---------------------------------------------------------------------------
These proposed rules also would require the party initiating open
negotiations to provide an open negotiation notice and supporting
documentation to the other party and the Departments via the Federal
IDR portal to initiate the open negotiation period. The Departments
also propose to require several new content requirements for the open
negotiation notice. Furthermore, these proposed rules would require the
party in receipt of the open negotiation notice to provide a response
to the open negotiation notice, with specified content, and supporting
documentation to the other party and the Departments no later than the
15th business day of the 30-business-day open negotiation period.
In addition, the Departments propose to amend the notice of IDR
initiation content requirements to require the initiating party to
submit certain additional information in the notice of IDR initiation.
The Departments also propose that the non-initiating party must submit
a written response to the notice of IDR initiation to the initiating
party and to the Departments within 3 business days after the date of
IDR initiation. These proposed rules would require the notice of IDR
initiation
[[Page 75809]]
response to include an attestation that the item or service that is the
subject of the dispute is a qualified IDR item or service or an
assertion that the item or service is not a qualified IDR item or
service, and an explanation and documentation to support the assertion.
Furthermore, the Departments propose that the non-initiating party
would also be required to indicate in the notice of IDR initiation
response whether they agree or object to the initiating party's
preferred certified IDR entity and provide a statement designating an
alternative preferred certified IDR entity if the non-initiating party
objects to the initiating party's preferred certified IDR entity.
These proposed rules would require parties furnishing the open
negotiation notice, open negotiation response notice, notice of IDR
initiation, and notice of IDR initiation response to provide the
notices and supporting documentation to the other party and the
Departments on the same day via the Federal IDR portal.
The Departments propose that if the party last in receipt of either
the notice of IDR initiation response or the notice of certified IDR
entity selection received the notice on the third business day after
the date of IDR initiation, the Departments would provide the party 2
additional business days to agree or object to other party's
alternative preferred certified IDR entity selection. The Departments
propose that if the party agrees with the other party's alternative
preferred certified IDR entity and notifies the Departments of such
agreement, or if the party fails to notify the Departments of its
objection by the fifth business day after the date of IDR initiation,
the Departments would select the alternative preferred certified IDR
entity as the certified IDR entity for the dispute. The Departments
propose that if the party notifies the Departments of its objection to
the alternative preferred certified IDR entity by the fifth business
day after the date of IDR initiation, the Departments would proceed
with random selection of the certified IDR entity.
Furthermore, the Departments propose to specify that the date of
preliminary selection of the certified IDR entity would be 3 business
days after the date of IDR initiation if the parties jointly selected a
certified IDR entity, or 6 business days after the date of IDR
initiation if the parties fail to agree and jointly select a certified
IDR entity, and the Departments randomly select a certified IDR entity.
These proposed rules would establish that if a selected certified IDR
entity attests to having a conflict of interest, the Departments would
randomly select another certified IDR entity, and the date of final
selection of the certified IDR entity would be the date the Departments
provide notice to the parties that the new certified IDR entity has
attested that it meets the conflict-of-interest requirements.
The Departments propose to establish several requirements regarding
eligibility determinations. Specifically, the Departments propose that
after the selected certified IDR entity attests that it meets the
conflict-of-interest requirements, the selected certified IDR entity
must review the information provided in the notice of IDR initiation
and notice of IDR initiation response, as well as any additional
information requested and received, and make an eligibility
determination no later than 5 business days after the date of final
selection of the certified IDR entity.
These proposed rules would also establish a departmental
eligibility review when the Departments, in their discretion, determine
that application of the departmental eligibility review is necessary to
facilitate timely payment determinations or the effective processing of
disputes under the Federal IDR process. When the departmental
eligibility review is in effect, the Departments would make eligibility
determinations, as opposed to the certified IDR entities. The
Departments propose to provide reasonable notice before the Departments
invoke the departmental eligibility review and before ceasing to use
the departmental eligibility review.
The Departments further propose to establish a process for disputes
to be withdrawn from the Federal IDR process. Specifically, the
Departments propose that a dispute may be withdrawn from the Federal
IDR process if: (1) the initiating party provides notification through
the Federal IDR portal to the Secretary and the certified IDR entity
(if selected) that both parties agree to withdraw the dispute from the
Federal IDR process, with signatures from authorized signatories for
both parties; (2) the initiating party provides a standard withdrawal
request notice to the Departments, the certified IDR entity (if
selected), and the non-initiating party and the non-initiating party
notifies the Secretary, certified IDR entity (if selected), and
initiating party of its agreement to withdraw the dispute within 5
business days of the initiating party's request (or the non-initiating
party fails to respond within 5 business days of the initiating party's
request); (3) the certified IDR entity or the Departments cannot
determine eligibility because both parties are unresponsive to any
requests for additional information to determine eligibility; or (4)
the certified IDR entity cannot make a payment determination because
both parties have failed to submit an offer as described in section
II.E.4. of this preamble.
The Departments also propose to amend the batching policies for the
Federal IDR process to increase efficiency and create a workable
framework for disputing parties and certified IDR entities.
Specifically, the Departments propose to allow qualified IDR items and
services to be batched if: (1) the items and services were furnished to
a single patient during a patient encounter on one or more consecutive
dates of service and billed on the same claim form (single patient
encounter); (2) the items and services were furnished to one or more
patients and were billed under the same service code, or a comparable
code under a different procedural code system; or (3) anesthesiology,
radiology, pathology, and laboratory qualified IDR items and services
were furnished under service codes belonging to the same Category I CPT
code range, as specified in guidance by the Departments. These proposed
rules would also require that no more than 25 qualified IDR items and
services may be considered jointly as part of one payment determination
for the purposes of batched determinations.
The Departments further propose several changes to the collection
of the administrative fee. First, in addition to proposing new
administrative fee amounts and a revised methodology for calculating
such amounts, the Departments propose that the initiating party must
pay the administrative fee within 2 business days of the date of
preliminary selection of the certified IDR entity. The Departments also
propose that the non-initiating party must pay the administrative fee
within 2 business days of notice of an eligibility determination by
either the certified IDR entity or the Departments, as applicable.
Third, the Departments propose to collect the administrative fee
directly from the disputing parties. Fourth, the Departments propose to
clarify how the Federal IDR process applies when either party fails to
timely pay the fees associated with the Federal IDR process. Finally,
the Departments propose to charge the disputing parties a reduced
administrative fee for low-dollar disputes and to charge the non-
initiating party a reduced administrative fee when either the certified
IDR entity or the Departments determine the dispute is not eligible for
the Federal IDR process.
[[Page 75810]]
The Departments also propose to clarify the extenuating
circumstances in which the time periods, other than under current 26
CFR 54.9816-8T(c)(4)(ix), 29 CFR 2590.716-8(c)(4)(ix), and 45 CFR
149.510(c)(4)(ix), may be extended. Specifically, the Departments
propose that such extenuating circumstances include circumstances that
contribute to systematic delays in processing disputes under the
Federal IDR process, such as an unforeseen volume of disputes or
Federal IDR portal system failures. The Departments also propose that
when the Departments determine that the parties or certified IDR
entities cannot meet applicable timeframes due to systemic delays in
processing disputes, the Departments would post a public notice
regarding any extension of time periods due to such extenuating
circumstances. These proposed rules would also establish that such
extenuating circumstances would include, for a specific dispute, when
the Departments determine that the parties or certified IDR entity
cannot meet applicable timeframes due to matters beyond the control of
one or both parties or the certified IDR entity, or for other good
cause. Further, the Departments propose that a certified IDR entity may
submit a request for an extension due to extenuating circumstances to
the Departments through the Federal IDR portal.
Finally, the Departments propose requiring plans and issuers that
are subject to the Federal IDR process to register with the Federal IDR
portal and submit certain information to the Departments. Under these
proposed rules, initial registration would be required to be completed
by the later of 30 business days after the effective date of the final
rule or if plans and issuers begin offering coverage subject to the
Federal IDR process after the effective date of the final rule, they
would be required to complete their initial registration on the date
the plan or issuer begins offering coverage subject to the Federal IDR
process.
The Departments have examined the effects of these proposed rules
as required by Executive Order 13563 (76 FR 3821, January 21, 2011,
Improving Regulation and Regulatory Review); Executive Order 12866 (58
FR 51735, October 4, 1993, Regulatory Planning and Review); the
Regulatory Flexibility Act (Pub. L. 96-354, enacted September 19, 1980,
Pub. L. 96-354); section 1102(b) of the Social Security Act (42 U.S.C.
1302(b)); section 202 of the Unfunded Mandates Reform Act of 1995
(March 22, 1995, Pub. L. 104-4); and Executive Order 13132 (64 FR
43255, August 10, 1999, Federalism).
B. Executive Orders 12866, 13563, and 14094--Departments of Health and
Human Services and Labor
Executive Orders 12866, 13563, and 14094 direct agencies to assess
all costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health and safety effects, distributive impacts, and equity). Executive
Order 14094 entitled ``Modernizing Regulatory Review'' amends section
3(f)(1) of Executive Order 12866 (Regulatory Planning and Review). The
amended section 3(f) of Executive Order 12866 defines a ``significant
regulatory action'' as an action that is likely to result in a rule:
(1) having an annual effect on the economy of $200 million or more in
any 1 year (adjusted every 3 years by the Administrator of OMB's Office
of Information and Regulatory Affairs (OIRA) for changes in gross
domestic product), or adversely affect in a material way the economy, a
sector of the economy, productivity, competition, jobs, the
environment, public health or safety, or State, local, territorial, or
tribal governments or communities; (2) creating a serious inconsistency
or otherwise interfering with an action taken or planned by another
agency; (3) materially altering the budgetary impacts of entitlement
grants, user fees, or loan programs or the rights and obligations of
recipients thereof; or (4) raising legal or policy issues for which
centralized review would meaningfully further the President's
priorities or the principles set forth in this Executive Order, as
specifically authorized in a timely manner by the Administrator of OIRA
in each case.
A regulatory impact analysis (RIA) must be prepared for rules
deemed significant under section 3(f)(1). Based on the Departments'
estimates, OMB's OIRA has determined these rules are significant under
section 3(f)(1). Therefore, the Departments have prepared an RIA that
to the best of their ability presents the costs and benefits of these
rules. OMB has reviewed these proposed regulations, and the Departments
have provided the following assessment of their impact.
C. Need for Regulatory Action--Departments of Health and Human Services
and Labor
As discussed in section II.B. of this preamble, gaps in
communication between plans and issuers and providers, facilities, and
providers of air ambulance services have resulted in confusion around
issues such as whether an item or service is eligible for resolution in
the Federal IDR process; how cost sharing and out-of-network rates must
be determined (that is, through an All-Payer Model Agreement, specified
State law, or Federal rules); how and with whom to initiate open
negotiations; and which eligible items and services can be batched or
bundled into one dispute. Additionally, a higher-than-expected number
of disputes have been submitted to the Federal IDR process for
resolution, with many found to be ineligible,\195\ contributing to
inefficiencies in resolving disputes in the Federal IDR process.
---------------------------------------------------------------------------
\195\ In the first full year of Federal IDR process operations,
approximately 37 percent of disputes were determined ineligible for
the Federal IDR process. See U.S. Department of Health and Human
Services, U.S. Department of Labor, and U.S. Department of the
Treasury. Federal Independent Dispute Resolution Process--Status
Update. April 27, 2023. https://www.cms.gov/files/document/federal-idr-processstatus-update-april-2023.pdf.
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These proposed rules would require plans and issuers to use CARCs
and RARCs, as specified in guidance issued by the Departments, or as
required under any applicable, adopted standards and operating rules
under 45 CFR part 162, to communicate information related to whether a
claim for an item or service furnished by an entity that does not have
a direct or indirect contractual relationship with the plan or issuer
for the furnishing of the item or service under the plan or coverage is
subject to the provisions of 26 CFR 54.9816 and 54.9817; 29 CFR
2590.716 and 2590.717; or 45 CFR part 149, subparts B, E, or F.
The July 2021 interim final rules require plans and issuers to
disclose the QPA and certain other information regarding the QPA for an
item or service furnished by a provider, facility, or provider of air
ambulance services, and specific information regarding the initiation
of the Federal IDR process. These requirements were later amended by
the August 2022 final rules. As discussed in section II.C. of this
preamble, the Departments propose to amend regulations at 26 CFR
54.9816-6T(d), 29 CFR 2590.716-6(d), and 45 CFR 149.140(d) to specify
that plans and issuers must disclose the QPA and certain information
about the QPA not only when the recognized amount (or for air ambulance
services, the amount on which cost sharing is based) is the QPA but
also when the recognized amount is the amount billed by the provider,
facility, or provider of air ambulance services as these items and
[[Page 75811]]
services would also be eligible for the Federal IDR process (provided
all other eligibility criteria are satisfied).
In addition, the Departments propose amendments to the statement
required to be provided by plans and issuers regarding the initiation
of open negotiation and availability of the Federal IDR process. The
Departments also propose amendments to the content of the statement to
refer to providers of air ambulance services (as well as providers and
facilities), and to specify that the open negotiation period is counted
in business days and that a party wishing to initiate open negotiation
must provide the required notice within 30 business days of receiving
an initial payment or notice of denial of payment. Furthermore, the
Departments propose that the statement must also note that the
provider, facility, or provider of air ambulance services must notify
the Departments, as applicable, to initiate open negotiations. To
ensure payment disputes are directed to the correct parties, the
Departments propose requiring plans and issuers to disclose the legal
business name of the plan (if any) or issuer; the legal business name
of the plan sponsor (if applicable); and the registration number to be
assigned under 26 CFR 54.9816-9, 29 CFR 2590.716-9, or 45 CFR 149.530,
as applicable, if the plan or issuer is registered with the Federal IDR
registry.
As discussed in section II.D.1. of this preamble, interested
parties generally report that disputing parties are not negotiating
with each other during the required open negotiation period to the
extent expected by the Departments. To encourage effective use of the
open negotiation period, the Departments propose to require the party
initiating open negotiations to use a standardized open negotiation
notice form, which includes an enumerated list of information, and to
send supporting documentation to the other party and the Departments to
initiate the open negotiation period. Furthermore, the party in receipt
of the open negotiation notice would be required to provide a response
to the open negotiation notice to the other party and the Departments
no later than the 15th business day of the 30-business-day open
negotiation period. The Departments are of the view that this proposal
would create more certainty regarding whether and when the initiating
party began open negotiations by ensuring that start and end dates are
documented in the Federal IDR portal. This proposal also may reduce the
number of ineligible disputes initiated by requiring the exchange of
eligibility information during open negotiation.
As discussed in section II.D.2. of this preamble, to accelerate
dispute processing and reduce the burden on certified IDR entities, the
Departments propose to require the initiating party to provide an
enumerated list of additional information in the notice of IDR
initiation, including the claim number, an attestation that the item or
service under dispute is a qualified IDR item or service and the basis
on which the party believes it is so, and a statement describing the
elements of the claim that serve as the basis for initiating the
Federal IDR process. Similarly, the Departments propose to require the
non-initiating party to provide a response to the notice of IDR
initiation that must also include an enumerated list of information,
including an agreement to the preferred certified IDR entity identified
in the notice of IDR initiation or an alternate preferred certified IDR
entity selection, an attestation that the item or service under dispute
is a qualified IDR item or service, and for each item or service that
the non-initiating party asserts is not a qualified IDR item or
service, an explanation and documentation to support the assertion. The
Departments are of the view that these additional elements would assist
in determining if the item or service is a qualified IDR item or
service that is eligible for the Federal IDR process, allow for a
streamlined process to track the initiation of the Federal IDR process,
enhance communication among the parties, and facilitate a more
efficient Federal IDR process.
As discussed in section II.E.1.a. of this preamble, since the
implementation of the Federal IDR process, the Departments have
identified potential areas to improve upon and provide additional
clarity with respect to the process for selecting a certified IDR
entity. In the Departments' experience implementing this process, when
a non-initiating party waits until the third business day after the
date of IDR initiation to select an alternative preferred certified IDR
entity, the initiating party lacks sufficient time to agree or object
to the alternative preferred certified IDR entity. To provide the
parties sufficient opportunity to agree or object to the alternative
preferred certified IDR entity, the Departments propose to amend the
process for selecting a certified IDR entity when the parties fail to
jointly agree on a certified IDR entity. Specifically, the Departments
propose that if the party last in receipt of either the notice of IDR
initiation response or the notice of certified IDR entity selection
received the notice on the third business day after the date of IDR
initiation and did not agree to the other party's alternative preferred
certified IDR entity by the end of third business day after the date of
IDR initiation, the Departments would provide the party 2 additional
business days to agree or object to other party's preferred certified
IDR entity selection.
To provide clarity and to codify the process and timeframes for
selecting a certified IDR entity, the certified IDR entity's conflict-
of-interest review, and the date the certified IDR entity selection is
considered finally selected, the Departments propose to establish a
process that includes both preliminary selection of the certified IDR
entity and final selection of the certified IDR entity. The Departments
are of the view that the conflict-of-interest review by the certified
IDR entity should not cut into the time periods for either the
disputing parties to submit their offers or for the certified IDR
entity to make a payment determination. For this reason, the
Departments propose requirements that would provide for a certified IDR
entity conflict-of-interest review process that must be conducted
before a preliminary selection of the certified IDR entity is
considered to be a final selected certified IDR entity. Under these
proposed rules, final selection of the certified IDR entity would
trigger the timeframes for conducting an eligibility review, accepting
offers of an out-of-network payment amount, and making a payment
determination.
As discussed in section II.E.1.b. of this preamble, eligibility
determinations have proven to be complex, time-consuming, resource-
intensive, and often uncompensated activities that impede timely
payment determinations. To support eligibility determinations during a
period of systemic delay or other extenuating circumstances, the
Departments propose to implement a departmental eligibility review.
When this departmental eligibility review is in effect, the Departments
would make eligibility determinations instead of the certified IDR
entities. The Departments are of the view that these changes are
necessary to ensure certified IDR entities are able to spend the
majority of their time and resources on making payment determinations
for eligible IDR items and services, prevent certified IDR entities
from temporarily suspending their acceptance of new disputes, ensure
participation in the Federal IDR process remains financially
sustainable for certified IDR entities, and prevent disparate outcomes.
[[Page 75812]]
As discussed in section II.E.1.d.ii. of this preamble, the
Departments have identified potential areas to improve upon and provide
additional clarity with respect to the process for disputes to be
withdrawn from the Federal IDR process. Currently, there is no clear
uniform process for parties, the certified IDR entity, or the
Departments to withdraw a dispute from the Federal IDR process. To
establish a process for withdrawals, the Departments propose four
conditions in which a dispute may be withdrawn from the Federal IDR
process by the initiating party, the Departments, or the certified IDR
entity before a payment determination is made. Specifically, the
Departments propose that a dispute may be withdrawn from the Federal
IDR process if: (1) the initiating party provides notification through
the Federal IDR portal to the Departments and the certified IDR entity
(if selected) that both parties agree to withdraw the dispute from the
Federal IDR process, with signatures from authorized signatories for
both parties; (2) the initiating party provides a standard withdrawal
request notice to the Departments, the certified IDR entity (if
selected), and the non-initiating party, and the non-initiating party
notifies the Secretary, certified IDR entity (if selected), and
initiating party of its agreement to withdraw within 5 business days of
the initiating party's request (or the non-initiating party fails to
respond within 5 business days of the initiating party's request); (3)
the certified IDR entity or the Departments cannot determine
eligibility because both parties to the dispute are unresponsive to any
requests for additional information to determine eligibility; or (4)
the certified IDR entity cannot make a payment determination because
both parties to the dispute have failed to submit an offer as described
in section II.E.4. of this preamble. The Departments are of the view
that these proposals would strike a balance between fairness to the
disputing parties and efficiency of the Federal IDR process by
generally requiring mutual agreement by the disputing parties to
withdraw the dispute and providing that a dispute would be withdrawn in
the event the parties are nonresponsive within the required timeframes.
As discussed in section II.E.2. of this preamble, in response to
the Departments' experiences with batched determinations and
operationalizing the Federal IDR process, as well as consideration of
interested parties' feedback, the Departments propose batching policies
for the Federal IDR process to increase efficiency and create a
workable framework for disputing parties and certified IDR entities.
The Departments propose to implement batching provisions that would
allow parties the flexibility to batch qualified IDR items and services
(or ``line items'') that relate to the treatment of similar conditions,
with necessary limitations to encourage efficiency. Specifically, the
policy would allow all qualified IDR items and services within the
following groupings to be batched together: (1) the items and services
were furnished to a single patient during a patient encounter on one or
more consecutive dates of service and billed on the same claim form
(single patient encounter); (2) the items and services were furnished
to one or more patients and billed under the same service code, or a
comparable code under a different procedural code system; or (3)
anesthesiology, radiology, pathology, and laboratory qualified IDR
items and services were furnished under service codes belonging to the
same Category I CPT code range, as specified in guidance by the
Departments. The Departments are of the view that this approach would
appropriately balance several objectives of the Federal IDR process,
including: encouraging efficiency (including minimizing costs) within
the Federal IDR process without unreasonably impeding payers' or
providers' access to the Federal IDR process and considering relative
costs and administrative burden; providing a framework to expedite
processing of the backlog of Federal IDR disputes by simplifying the
Federal IDR process while avoiding creating new operational
complexities; and ensuring that items and services included in batched
determinations have a clear organizing principle that makes for logical
and consistent payment determinations across certified IDR entities in
order to reduce the chance of disparate outcomes. The Departments also
propose to codify the definition of a bundled payment arrangement, as
currently set forth in guidance, at proposed 26 CFR 54.9816-3, 29 CFR
2590.716-3, and 45 CFR 149.30.
As discussed in section II.E.3. of this preamble, to implement a
fair and efficient Federal IDR process, the Departments propose to
amend the certified IDR entity and administrative fee provisions of the
Federal IDR process to align financial incentives for disputing parties
with the efforts associated with administering the Federal IDR process.
The Departments propose to amend the provisions related to the time and
manner of fee collection, such that an initiating party would be
required to pay the non-refundable administrative fee within 2 business
days of the date of preliminary selection of the certified IDR entity,
and a non-initiating party would be required to pay the non-refundable
administrative fee within 2 business days of being notified of an
eligibility determination. The Departments also propose to add
flexibility to the process by removing the requirement that certified
IDR entities, rather than the Departments, must collect the
administrative fee, and propose to directly collect the administrative
fee from the parties. The Departments further propose to revise how the
Federal IDR process applies when either party fails to timely pay the
fees associated with the Federal IDR process. The Departments also
propose charging the disputing parties a reduced administrative fee for
low-dollar disputes and charging a non-initiating party a reduced
administrative fee when either the certified IDR entity or the
Departments determine the dispute is not eligible for the Federal IDR
process. The Departments are of the view that these fee collection
changes would ensure that disputing parties pay an administrative fee
to participate in the Federal IDR process even if the dispute is
determined to be ineligible, remove the operational burden from
certified IDR entities of processing administrative fees and remitting
them to the Departments, improve accessibility of the Federal IDR
process for certain types of parties, more fairly allocate the costs
associated with ineligible disputes, and help reduce the need for
future increases to the administrative fee.
As discussed in section II.E.5. of this preamble, the Departments
are proposing to codify a generally applicable extension of time
periods when the Departments determine that such extension is necessary
due to extenuating circumstances that contribute to systematic delays
in processing disputes under the Federal IDR process, such as a high
volume of disputes or Federal IDR portal system failures. This would
allow the Departments to extend the time periods under the Federal IDR
process without requiring a case-by-case analysis of individual
extension requests. The Departments are of the view that granting
certain extensions in this manner would provide protection for parties
engaged in the Federal IDR process from the impact of systematic
processing delays and ensure that unforeseen circumstances do not
unfairly disadvantage a party or hinder its ability to comply with the
Federal
[[Page 75813]]
IDR process timeframes. This would also provide more transparency into
the timing it would take for a dispute to be processed.
As discussed in section II.F. of this preamble, the Departments
propose requiring plans and issuers subject to the Federal IDR process
to register with the Departments and provide general information on the
application of the Federal IDR process to items or services covered by
the plan or coverage. Providers, facilities, and providers of air
ambulance services report that when they initiate open negotiations
prior to initiating the Federal IDR process, it is often difficult to
identify the plan or issuer with which they are seeking to initiate a
dispute, determine the correct contact information for initiating open
negotiation or a dispute, and delineate between different group health
plans offered by the same plan sponsor. To address these issues, the
Departments propose to make available a registry containing this
information, which would help providers, facilities, and providers of
air ambulance services initiate open negotiations and the Federal IDR
process with all required information by resolving the aforementioned
information-sharing issues between parties.
D. Summary of Impacts and Accounting Table--Departments of Health and
Human Services and Labor
The expected benefits and costs of these proposed rules are
summarized in Table 6 and discussed in this section of the preamble. In
accordance with OMB Circular A-4, Table 6 depicts an accounting
statement summarizing the Departments' assessment of the benefits and
costs associated with this regulatory action. The Departments are
unable to quantify all benefits and costs of these proposed rules but
have sought, where possible, to describe these non-quantified impacts.
The effects in Table 6 reflect non-quantified impacts and estimated
direct monetary costs resulting from the provisions of these proposed
rules.
BILLING CODE 6325-63-P; 4830-01-P; 4510-29-P; 4120-01-P
[[Page 75814]]
[GRAPHIC] [TIFF OMITTED] TP03NO23.009
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[GRAPHIC] [TIFF OMITTED] TP03NO23.010
BILLING CODE 6325-63-C; 4830-01-C; 4510-29-C; 4120-01-C
1. Benefits
These rules seek to maximize benefits to providers, facilities,
providers of air ambulance services, plans, and issuers and to reduce
burdens on certified IDR entities. The Departments invite comment
regarding the assumptions
[[Page 75816]]
made in this section and any additional benefits that would be
associated with the proposals in these rules. The Departments also seek
comment from individuals from minority and underserved communities, and
providers who serve these individuals, to help address the benefits
that would be associated with these proposed rules related to these
communities specifically.
a. Use of Claim Adjustment Reason Codes and Remittance Advice Remark
Codes
The proposed new 26 CFR 54.9816-6A, 29 CFR 2590.716-6A, and 45 CFR
149.100, which would require plans and issuers to use CARCs and RARCs
to convey information related to the No Surprises Act as specified in
guidance issued by the Departments or as required under any applicable
adopted standards and operating rules under 45 CFR part 162, on
electronic and paper remittance advice, would help to ensure plans and
issuers provide information to providers, facilities, and providers of
air ambulance services in a standardized manner and in standardized
language so that they may understand whether and how the No Surprises
Act applies to claims for out-of-network items and services and
determine whether disputes are eligible for the Federal IDR process or
subject to a specified State law or All-Payer Model Agreement for
purposes of determining the out-of-network rate. Additionally, the use
of CARCs and RARCs would further reduce the potential for the
communication issues discussed in section II.B. of this preamble, and
would help providers, facilities, and providers of air ambulance
services identify items and services that are not subject to the No
Surprises Act's balance billing protections and thus identify items and
services that are not eligible for the Federal IDR process.
By ensuring that a plan or issuer communicates information related
to whether a claim for an item or service furnished by an entity that
does not have a direct or indirect contractual relationship with the
plan or issuer for the furnishing of the item or service under the plan
or coverage is subject to the prohibitions on balance billing in the No
Surprises Act, the proposed CARC and RARC requirements would reduce the
number of ineligible payment disputes submitted to the Federal IDR
process, as further described in section V.D.1.l. of this preamble. The
potential reduction in ineligible Federal IDR disputes could result in
faster payment determinations, which in turn would result in providers,
facilities, and providers of air ambulance services receiving
reimbursements sooner.
b. Information To Be Shared About the QPA (26 CFR 54.9816-6T, 29 CFR
2590.716-6, and 45 CFR 149.140)
These proposed rules would revise 26 CFR 54.9816-6T(d), 29 CFR
2590.716-6(d), and 45 CFR 149.140(d) to specify that plans and issuers
must disclose the QPA and certain information about the QPA when cost
sharing is calculated using the QPA or the billed amount (including for
air ambulance services, for which the term ``recognized amount'' is
inapplicable). These proposed revisions would provide greater clarity
regarding when these disclosures must be provided.
Further, the proposed amendments at 26 CFR 54.9816-6, 29 CFR
2590.716-6, and 45 CFR 149.140 would require plans and issuers to
disclose the legal business name (if any) of the plan or issuer; the
legal business name of the plan sponsor (if applicable); the
registration number assigned under 26 CFR 54.9816-9, 29 CFR 2590.716-9,
or 45 CFR 149.530, as applicable, if the plan or issuer is registered
with the Federal IDR registry. The proposed amendments would help
ensure that payment disputes are directed to the appropriate parties,
facilitate more productive open negotiations, and reduce the number of
ineligible disputes ultimately submitted to the Federal IDR process (as
further described in section V.D.1.l. of this preamble). Additionally,
the required disclosure of the legal business name (if any) of the plan
or issuer, the legal business name of the plan sponsor (if applicable),
and the registration number would help providers, facilities, and
providers of air ambulance services look up plans, plan sponsors, and
issuers in the Federal IDR registry that would be established under
these proposed rules.
c. Open Negotiation
The Departments propose to amend the open negotiation provisions at
26 CFR 54.9816-8(b)(1), 29 CFR 2590.716-8(b)(1), and 45 CFR
149.510(b)(1) to require the party initiating open negotiations to
provide an open negotiation notice and supporting documentation to the
other party and the Departments through the Federal IDR portal to
initiate the open negotiation period. The Departments also propose to
expand the required information on the open negotiation notice to
include new elements. Furthermore, the Departments propose that the
party in receipt of the open negotiation notice would be required to
provide a response to the open negotiation notice and supporting
documentation to the other party and the Departments no later than the
15th business day of the 30-business-day open negotiation period. Both
of these notice provisions require the parties to provide specific
information detailed in the proposed regulatory text.
The Departments propose these changes to improve information
sharing among the parties and the Departments. The Departments are of
the view that this proposal would create more certainty regarding
whether and when a party began open negotiations by recording start and
end dates. Furthermore, this proposal may allow the parties to focus
negotiations on items or services they believe would ultimately be
eligible for the Federal IDR process. This proposal would also create
an additional exchange of eligibility-related disclosures between the
parties that may reduce the number of ineligible disputes submitted to
the Federal IDR process, as further described in section V.D.1.l. of
this preamble. While the Departments have issued guidance to clarify
that the use of an issuer's proprietary open negotiation portal is not
required by the parties, many issuers currently maintain their own open
negotiation portals and encourage parties to submit notices through
them. This proposal would benefit providers, facilities, and providers
of air ambulance services by creating a centralized location in which
they can exchange information for open negotiation, as opposed to using
different portals and systems depending on the plan or issuer. These
proposed requirements would reduce the number of platforms or vehicles
the party submitting the open negotiation notice currently use to
furnish the notices and supporting documentation to both the
Departments and the other party.
d. Initiating the Federal IDR Process and Notice of IDR Initiation
The Departments propose changes to 26 CFR 54.9816-8(b)(2), 29 CFR
2590.716-8(b)(2), and 45 CFR 149.510(b)(2). Specifically, the
Departments propose to require the initiating party to provide
additional elements on the notice of IDR initiation, including expanded
information to identify the disputing parties (as well as any third
party representing a party) and additional information to identify the
item or service subject to the dispute.
Similarly, the Departments propose to require the non-initiating
party to provide a response to the notice of IDR initiation that must
include an enumerated list of information with
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additional disclosures, such as either a statement agreeing to the
preferred certified IDR entity or an alternative preferred certified
IDR entity, and an attestation as to the eligibility of the item or
service that is the subject of the dispute. The Departments are of the
view that these additional elements would assist in determining whether
the item or services is eligible for the Federal IDR process, allow for
a streamlined process to track dispute initiation, enhance
communication among the parties, and facilitate a more efficient
process of IDR initiation. Information about why the non-initiating
party believes the dispute is ineligible for the Federal IDR process
would assist the Departments or the certified IDR entity in its review
of dispute eligibility, thereby streamlining the eligibility review
process.
Additionally, by streamlining the submission of these notices
through the Federal IDR portal, including the open negotiation notice
and open negotiation response notice, the Departments may be able to
use information that was submitted for one notice to pre-populate
subsequent notices, reducing the burden of providing duplicative
information. For instance, if a party that submitted the open
negotiation notice through the Federal IDR portal decides to initiate
the Federal IDR process after the open negotiation period has ended,
the Departments anticipate that the Federal IDR portal may be able to
pre-populate the fields in the notice of IDR initiation with the same
information that was provided in the open negotiation notice.
Furthermore, these proposed requirements would reduce the number of
platforms or vehicles the initiating party must use in order to furnish
the notice of IDR initiation and supporting documentation to both the
Departments and the other party. This administrative streamlining would
simplify the burden on initiating parties and would create greater
efficiency.
e. Certified IDR Entity Selection
The Departments propose amending 26 CFR 54.9816-8(c)(1), 29 CFR
2590.716-8(c)(1), and 45 CFR 149.510(c)(1) regarding the process for
certified IDR entity selection and submission of the notice of
certified IDR entity selection. In the Departments' experience
implementing the Federal IDR process, when a non-initiating party waits
until the third business day after the date of IDR initiation to select
an alternative preferred certified IDR entity, the initiating party
lacks sufficient time to agree or object to the alternative preferred
certified IDR entity. To provide the parties sufficient opportunity to
agree or object to an alternative preferred certified IDR entity, the
Departments propose that if the party last in receipt of either the
notice of IDR initiation response or the notice of certified IDR entity
selection received the notice on the third business day after the date
of IDR initiation and did not agree to the other party's alternative
preferred certified IDR entity by the end of third business day after
the date of IDR initiation, the Departments would provide the party 2
additional business days to agree or object to other party's
alternative preferred certified IDR entity selection. Further, to
provide clarity and to codify the process and timeframes for selecting
a certified IDR entity, the certified IDR entity's conflict-of-interest
review, and the date the certified IDR entity selection is considered
finally selected, the Departments propose to establish a process that
includes both preliminary selection of the certified IDR entity and
final selection of the certified IDR entity. The Departments are of the
view that the conflict-of-interest review by the certified IDR entity
should not cut into the time periods for either the disputing parties
to submit their offers or for the certified IDR entity to make a
payment determination. For this reason, the Departments propose
requirements that would provide for a certified IDR entity conflict-of-
interest review process that must be conducted before a preliminary
selection of the certified IDR entity is considered a final selected
certified IDR entity. Under these proposed rules, the final selection
of the certified IDR entity would trigger the timeframes for conducting
an eligibility review, accepting offers of an out-of-network payment
amount, and making a payment determination. The Departments are of the
view that this proposal would streamline the exchange of information
between parties, provide clarity on the dates that trigger the
timeframes for offer submission and payment determinations, and relieve
the time constraints on certified IDR entities by not having the
conflict-of-interest review cut into the timeframe for payment
determinations.
f. Federal IDR Process Eligibility Determinations
The Departments propose amending 26 CFR 54.9816-8(c), 29 CFR
2590.716-8(c), and 45 CFR 149.510(c) to make Federal IDR process
eligibility determinations the responsibility of the Departments in
certain circumstances. Under this proposal, when certain criteria are
met as discussed in section II.E.1.b. of this preamble, the Departments
would determine whether the dispute is eligible and make the
eligibility determination for the Federal IDR process (that is,
departmental eligibility review). If the dispute is found to be
eligible, the Departments would send it to the certified IDR entity to
continue the Federal IDR process. If the dispute is found to be
ineligible for the Federal IDR process, it would be closed.
When the Departments are conducting eligibility determinations, it
would relieve the burden on certified IDR entities of this
responsibility and help ensure that they can focus their time and
resources on payment determinations in accordance with statutory
timeframes.
g. Withdrawals
The Departments propose to add 26 CFR 54.9816-8(c)(3)(ii), 29 CFR
2590.716-8(c)(3)(ii), and 45 CFR 149.510(c)(3)(ii) to establish a
process for disputes to be withdrawn from the Federal IDR process.
First, these proposed rules would allow a dispute to be withdrawn from
the Federal IDR process if the initiating party provides notification
through the Federal IDR portal to the Departments and the certified IDR
entity (if selected) that both parties agree to withdraw the dispute,
with signatures from authorized signatories for both parties. These
proposed rules would also establish that the initiating party could
withdraw a dispute by submitting a standard withdrawal request notice
to the Departments, the non-initiating party, and the certified IDR
entity (if selected) through the Federal IDR portal. In this case, the
non-initiating party would then be required to provide the standard
withdrawal request response notice within 5 business days indicating
agreement or objection to the request for withdrawal. If the non-
initiating party fails to respond within 5 business days of the
initiating party's request, the non-initiating party would be
considered to have agreed to the dispute's withdrawal.
The Departments also propose to establish that the certified IDR
entity or the Departments could withdraw a dispute from the Federal IDR
process if the certified IDR entity or the Departments cannot determine
eligibility because both parties are unresponsive to any requests for
additional information to determine eligibility, or if the certified
IDR entity cannot make a payment determination because both parties
have failed to submit an offer as described in 26 CFR 54.9816-
8(c)(5)(i), 29 CFR 2590.716-8(c)(5)(i), and 45 CFR 149.510(c)(5)(i).
The Departments are of the view that these proposals would both create
[[Page 75818]]
fairness to the disputing parties and encourage efficiency of the
Federal IDR process by generally requiring mutual agreement by the
disputing parties to withdraw the dispute and providing that the
dispute would be withdrawn in the event the parties are nonresponsive
within the required timeframes. The Departments also are of the view
that permitting the withdrawal of a dispute in such cases would
decrease the number of payment determinations the certified IDR entity
is required to adjudicate, improving efficiency of the Federal IDR
process.
h. Treatment of Batched Items and Services
The Departments propose to amend the batching polices in response
to the Departments' experiences with batched determinations and
operationalizing the Federal IDR process, as well as consideration of
interested parties' feedback regarding the Federal IDR process. Under
this proposal, the Departments would allow parties the flexibility to
batch qualified IDR items and services (or ``line items'') that relate
to the treatment of similar conditions with necessary limitations to
encourage efficiency. Specifically, the policy would allow all
qualified IDR items and services to be batched by: (1) items and
services furnished to a single patient during a patient encounter on
one or more consecutive dates of service and billed on the same claim
form (single patient encounter); (2) items and services were furnished
to one or more patients and billed under the same service code, or a
comparable code under a different procedural code system; or (3)
anesthesiology, radiology, pathology, and laboratory IDR items and
services furnished under service codes belonging to the same Category I
CPT code range, as specified in guidance by the Departments, in order
to address the unique circumstances of certain medical specialties and
provider types.
As discussed in section II.E.2. of this preamble, the Departments
are of the view this approach would encourage efficiency (including
minimizing costs) within the Federal IDR process without unreasonably
impeding payers' or providers' access to the Federal IDR process
considering relative costs and administrative burden; provide a
framework to expedite processing of the backlog of Federal IDR disputes
by simplifying the Federal IDR process; and ensure that items and
services included in batched determinations have a clear organizing
principle that makes for logical and consistent payment determinations
across certified IDR entities to reduce the chance of disparate
outcomes.
i. Administrative and Certified IDR Entity Fee Collection
i. Establishment of the Administrative Fee Amount and Methodology
First, the Departments propose revisions to the methodology for
setting the administrative fee and propose new reduced administrative
fee amounts. The revised methodology and amounts would account for the
proposals in these proposed rules, such as the reduced administrative
fees for ineligible disputes and low-dollar disputes discussed in
sections II.E.3.e. and II.E.3.f. of this preamble, while still
complying with the statutory requirement that the Departments set the
administrative fee amount such that the total amount of fees paid for
such year is estimated to be equal to the amount of expenditures
estimated to be made by the Departments for such year in carrying out
the Federal IDR process. These proposals would allow the Departments to
administer the Federal IDR process and be responsive to the needs of
the program by updating the methodology and administrative fee amounts
in conjunction with policy and operational improvements to the process.
ii. Time of Collection of Administrative Fee and Certified IDR Entity
Fee
Second, the Departments are proposing to amend the provisions
related to the time of administrative fee collection such that an
initiating party would be required to pay the non-refundable
administrative fee within 2 business days of the date of preliminary
selection of the certified IDR entity, which occurs before an
eligibility determination is complete, and the non-initiating party
would be required to pay the non-refundable administrative fee within 2
business days of the non-initiating party receiving notice of an
eligibility determination. Specifically, an initiating party would be
expected to pay the administrative fee regardless of whether the
dispute is determined eligible for the Federal IDR process. Because the
administrative fees are currently non-refundable and under the current
regulation and associated impact analysis, this benefit is unchanged.
The Departments are of the view that the effect of this change in
benefits experienced as a result of this proposal on disputing parties
would be minimal.
Overall, the Departments are of the view that this proposal would
promote the objective of costs of using the Federal IDR process being
proportionately borne by parties to both eligible and ineligible
disputes.
iii. Manner of Administrative Fee Collection
Third, the Departments are proposing to directly collect the
administrative fee from each party. Because the administrative fees are
always non-refundable, the Departments are of the view that the impact
of this proposed change would be minimal. The Departments anticipate
that direct collection of the administrative fee by the Departments
would reduce the burden on certified IDR entities, as it would remove
the requirement that certified IDR entities collect this fee and later
remit it to the Departments upon dispute closure. This burden is
currently approved under OMB control number 1210-0169 and accounts for
an average of 18 hours of clerical worker time annually per certified
IDR entity, as discussed further in section V.F.7. of this
preamble.\196\ If this policy is finalized, the Departments anticipate
this change would have minimal impact on the certified IDR entities, as
certified IDR entities would continue to collect certified IDR entity
fees from disputing parties.
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\196\ OMB Control Number: 1210-0169 (No Surprises Act: IDR
Process). The burden is estimated as follows: (18 hours x $39.56) =
$712.08 per certified IDR entity. A labor rate of $39.56 is used for
a clerical worker. The labor rates are applied in the following
calculation: (13 x 18 hours x $39.56) = $9,257.
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iv. Application of Federal IDR Process Requirements in Circumstances
Involving a Failure To Pay Certified IDR Entity Fees or Administrative
Fees
Fourth, the Departments propose to clarify how the Federal IDR
process applies when either party fails to timely pay the fees
associated with the Federal IDR process. Specifically, the failure to
pay the administrative fee by an initiating party would result in the
closure of the dispute due to nonpayment, and failure to pay the
certified IDR entity fee by an initiating party would result in the
certified IDR entity not considering the initiating party's offer.
Nonpayment of the certified IDR entity fee or administrative fee by a
non-initiating party would result in the certified IDR entity not
considering the non-initiating party's offer. The Departments are of
the view that the impact of this change would be minimal. The purpose
of this policy is to codify the sub-regulatory guidance that already
exists and allow the closure of disputes in which the initiating party
[[Page 75819]]
does not provide the appropriate administrative fee payment.
v. Administrative Fee Structure for Disputing Parties in Low-Dollar
Disputes
Fifth, the Departments propose to charge both parties a reduced
administrative fee when the initiating party attests that the highest
offer (or aggregate offers for a dispute, whether the dispute is for
one item or service, a bundled arrangement, or multiple items and
services submitted as part of a batched dispute) made during open
negotiation by either disputing party was less than the predetermined
threshold. Because a reduction to the administrative fee would only be
made in these limited situations, the Departments are of the view that
the impact of this change would be minimal for most parties,
particularly if the value of disputes increases as intended under the
batching policies proposed in these rules, if finalized.
Furthermore, the Departments are of the view that this proposal
would have a positive impact on some initiating parties, particularly
small providers or providers in rural areas, that may not be able to
efficiently access the Federal IDR process even under the batching
policies proposed in these rules. Even though the Departments estimate
in the Regulatory Flexibility Act analysis later in these proposed
rules that there are approximately 66,000 small physicians \197\ that
may access the Federal IDR process, the Departments lack the data or
ability to estimate how many providers would actually initiate the
Federal IDR process and how many would or would not be able to
efficiently initiate the process under the proposed batching policies
in these rules and would therefore be impacted by the proposed reduced
administrative fee for low-dollar disputes. The Departments seek
comment on data sources or other resources to quantitatively estimate
the benefits to this population and how to estimate the proportion of
disputes that would be impacted by this policy.
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\197\ Based on data from the NAICS Association for NAICS code
62111 (Offices of Physicians), the Departments estimate the percent
of businesses within the industry of Offices of Physicians with less
than $16 million in annual sales. By this standard, the Departments
estimate that 47.2 percent or 66,207 physicians are considered small
under the SBA's size standards. See https://www.census.gov/data/tables/2017/econ/susb/2017-susb-annual.html.
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vi. Administrative Fee Structure for Non-Initiating Parties in
Ineligible Disputes
The Departments propose to charge the non-initiating party a
reduced administrative fee when either the certified IDR entity or the
Departments determine the entire dispute is not eligible for the
Federal IDR process. Because a reduction to the administrative fee
would be made only in this limited situation and one other situation
(for low-dollar disputes), the Departments are of the view that the
impact of this change would be minimal, particularly if the volume of
ineligible disputes is reduced as anticipated due to the other policies
proposed in these rules. The Departments are of the view that system
improvements coupled with a reduced administrative fee in ineligible
disputes may incentivize non-initiating parties to proactively raise
and provide documentation to support eligibility challenges earlier in
open negotiation or the Federal IDR process. This may result in a
reduction in the volume of ineligible disputes (as further described in
section V.D.1.l. of this preamble) and therefore reduce program
administrative costs for the Departments overall. The Departments seek
comment on the impact of a reduced administrative fee for non-
initiating parties in ineligible disputes, including whether bad faith
challenges to dispute eligibility may increase burden and whether
modifications to the guidance for disputing parties are needed to
prevent bad faith challenges to dispute eligibility.
j. Extension of Time Periods for Extenuating Circumstances
The Departments are proposing to amend 26 CFR 54.9816-8(g), 29 CFR
2590.716-8(g), and 45 CFR 149.510(g) to establish at paragraph
(g)(1)(i) that the Departments, or at the request of a certified IDR
entity or a party, would determine whether an extension is necessary
because the parties or certified IDR entity cannot meet applicable
timeframes due to matters beyond the control of the certified IDR
entity or one or both parties, or for other good cause. Under these
proposed rules, the Departments would provide an extension of the time
periods if they identify unforeseen or good cause delays on a case-by-
case basis, as opposed to solely relying on one of the parties to
submit an extension request. The Departments may detect these issues
before either party would, and could immediately grant the necessary
extension without having to wait for the submission of a formal
request.
The Departments also propose to establish at 26 CFR 54.9816-
8(g)(1)(ii), 29 CFR 2590.716-8(g)(1)(ii), and 45 CFR 149.510(g)(1)(ii)
to codify a generally applicable extension of time periods when the
Departments determine that such extension is necessary due to
extenuating circumstances that contribute to systematic delays in
processing disputes under the Federal IDR process, such as a high
volume of disputes or Federal IDR portal system failures. The
Departments would also post a public notice about any generally
applicable extensions of time periods. Under these proposed changes,
the Departments would extend the time periods under the Federal IDR
process without requiring a case-by-case analysis of individual
extension requests. The Departments are of the view that granting
certain extensions in this manner would provide protection for parties
engaged in the Federal IDR process from the impact of systematic
processing delays and ensure that unforeseen circumstances do not
unfairly disadvantage a party or hinder its ability to comply with the
Federal IDR process timeframes. This would also provide more
transparency into the time it would take for a dispute to be processed.
k. Registration of Group Health Plans and Health Insurance Issuers
Access to the IDR registry would provide a single, centralized
place for initiating parties to find contact information for a plan or
issuer, therefore reducing time spent by providers, facilities, and
providers of air ambulance services when they initiate open
negotiations. The registry would also help reduce wasted effort on
inappropriately initiated disputes for certified IDR entities, as well
as both initiating and non-initiating parties, by minimizing: (1)
disputes initiated against the wrong party; (2) disputes over items or
services that are subject to a specified State law or All-Payer Model
Agreement; and (3) disputes that are incorrectly batched.
l. Reduction in Ineligible Disputes
The Departments anticipate that provisions of these proposed rules,
in particular the proposed use of RARCs and CARCs, the proposed
requirements in the open negotiation notice and response and the IDR
initiation notice and response, the proposed modifications to batching
requirements, the proposal to require the initiating party to pay the
non-refundable administrative fee earlier in the
[[Page 75820]]
initiation process, and the proposed registry for group health plans
and health insurance issuers, would reduce the number of ineligible
disputes initiated in the Federal IDR process each year. Preliminary
internal data indicate that between June 2022 and May 2023,
approximately 48,000 disputes were determined to be ineligible by
certified IDR entities. Based on this data and the rates of
ineligibility attributable to various reasons (for example, State
jurisdiction over the dispute or the dispute being initiated against
the wrong non-initiating party), the Departments estimate that a total
decrease in ineligible disputes of approximately 50 to 75 percent, or
24,000 to 36,000 disputes, could result from the cumulative impact of
these proposals each year. The Departments have calculated this
estimated range to reflect that the proposals in these rules, while
severable, may work in concert with one another to reduce ineligible
disputes. Uncertainties in the reduction of ineligible disputes remain,
and the Departments note that variables such as the number of disputes
initiated have changed over time and may continue to fluctuate.
Therefore, it is possible that the number of ineligible disputes
ultimately prevented by the proposals in these rules could be outside
of the range estimated in this paragraph.
2. Costs
These proposed rules seek to minimize costs to providers,
facilities, providers of air ambulance services, plans, and issuers.
The Departments seek comments on the assumptions made in this section
and any additional costs that would be incurred by affected parties
associated with the proposals in these proposed rules. The Departments
also seek comment from individuals from minority and underserved
communities, and providers who serve these individuals, to help address
the costs that would be associated with these proposed rules related to
these communities specifically.
a. Required Use of CARCs and RARCs
Plans and issuers would incur costs to comply with the requirements
of these proposed rules related to the use of CARCs and RARCs. Plans
and issuers would be required to use CARCs and RARCs on both electronic
and paper remittance advice, in accordance with guidance issued by the
Departments or as required under any applicable, adopted standards and
operating rules under 45 CFR part 162. This would be necessary when
processing out-of-network claims \198\ to communicate information
related to whether a claim for an item or service furnished by an
entity that does not have a direct or indirect contractual relationship
with the plan or issuer for the furnishing of the item or service under
the plan or coverage is subject to the No Surprises Act's surprise
billing provisions.
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\198\ This requirement would not apply to claims submitted by a
participant, beneficiary, or enrollee directly to the plan or issuer
for items or services furnished by a nonparticipating provider or
nonparticipating facility.
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The Departments estimate that 1,500 issuers \199\ and 205 TPAs
\200\ would incur costs to automate the process to include the
appropriate CARCs and RARCs in the appropriate remittance documents and
comply with the proposed provisions. The Departments anticipate that
issuers and TPAs would need to make annual changes to their IT systems
to accommodate additional No Surprises Act-related CARCs and RARCs that
may be required by the Departments in future guidance, or as required
under any applicable adopted standards and operating rules under 45 CFR
part 162. The Departments estimate that each issuer or TPA would
require a computer programmer 8 hours (at an hourly rate of $98.84)
\201\ to make annual changes to their IT system to allow for the
incorporation of newly developed No Surprises Act-related CARCs and
RARCs into their remittance documents and an operations manager 1 hour
(at an hourly rate of $118.14) to annually verify accuracy and
accessibility. The Departments estimate that each issuer or TPA would
require a total of 9 hours annually, with an associated cost of $909.
For all issuers and TPAs, the Departments estimate an annual burden of
15,345 hours, with an associated total annual cost of $1,549,606
beginning in 2024.
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\199\ Based on data from MLR annual report for the 2021 MLR
reporting year. See https://www.cms.gov/CCIIO/Resources/Data-Resources/mlr.
\200\ Non-issuer TPAs based on data derived from the 2016
benefit year reinsurance program contributions.
\201\ Wage rate derived from the BLS May 2022 National
Occupational Employment and Wage Estimates for Computer Programmer
(occupation 15-1251). Mean hourly rate ($49.42) has been increased
by 100 percent to account for the cost of fringe benefits and other
indirect costs ($49.42 * 100% = $98.84).
[GRAPHIC] [TIFF OMITTED] TP03NO23.011
The Departments anticipate that most issuers and TPAs that are
subject to HIPAA Administrative Simplification requirements currently
use ERA and therefore are already required to use CARCs and RARCs in
their ERAs to providers. However, the Departments recognize that some
plans, issuers, and TPAs may not have the capacity to use more than one
CARC and RARC per line item or may not currently use CARCs and RARCs
when providing paper remittances. These issuers and TPAs would incur a
higher burden and cost associated with the proposed provisions,
particularly to the extent that an issuer or TPA is required to use
multiple CARCs and RARCs per line item. In addition, plans and issuers
with narrow networks may incur increased costs, as they would likely
process more out-of-network claims to which this proposal would apply.
The Departments anticipate that TPAs would, in general, pass on the
costs to implement the use of CARCs and RARCs to plan sponsors, which
in turn could be passed on to participants in the form of higher
premiums or contributions.
[[Page 75821]]
The Departments seek comment on these estimates, the number of
issuers or TPAs that do not currently have the ability to use CARCs and
RARCs on paper remittance documents, what the burden and cost would be,
and if any of those costs would be passed on to plan sponsors, to meet
the requirements of this proposed provision. The Departments
specifically seek comment on whether plans and issuers generally have
the ability to use CARCs and RARCs in both paper and electronic
remittance advice, or just electronic remittance advice. The
Departments recognize that an issuer's or TPA's current IT structure
could play a role in their ability to meet the requirements in the
proposed provisions and the ability to apply more than one CARC and
RARC combination on a single line item, if required in certain
scenarios. The Departments seek comment on issuers' and TPAs'
capability to implement new No Surprises Act-specific CARCs and RARCs
and to use more than one CARC and RARC combination on a single line
item if necessary; what barriers plans, issuers, and TPAs may face in
developing and implementing this capability; and what associated burden
and cost would be incurred to implement and operationalize this
capability for both electronic and paper remittances.
In addition, the use of CARCs and RARCs on both electronic and
paper remittance advice would potentially reduce costs to certified IDR
entities by reducing the number of ineligible payment disputes
submitted to the Federal IDR process, as further described in section
V.D.1.l. of this preamble. It would also reduce administrative costs
incurred by parties related to initiating and responding to ineligible
payment disputes.
b. Information To Be Shared About the QPA
As detailed in section V.F.2. of this preamble, the Departments
estimate that in the aggregate plans (or their TPAs) and issuers would
incur a total one-time cost in 2024 of approximately $505,567 to make
changes to the currently required QPA notification to incorporate the
additional information described in proposed amendments to paragraphs
26 CFR 54.9816-6(d)(1)(iv) and (v), 29 CFR 2590.716-6(d)(1)(iv) and
(v), and 45 CFR 149.140(d)(1)(iv) and (v).
c. Open Negotiation
The Departments propose to amend the open negotiation provisions to
require the party initiating open negotiations to provide an open
negotiation notice and supporting documentation to the other party and
the Departments through the Federal IDR portal to initiate the open
negotiation period. The Departments propose to expand the required
information on the open negotiation notice to include new elements.
Furthermore, the party in receipt of the open negotiation notice would
be required to provide a response to the open negotiation notice within
the first 15 business days of 30-business-day open negotiation period.
To implement this proposal and other proposals in these proposed
rules impacting the submission of information to the Federal IDR portal
(including the proposals pertaining to the notice of IDR initiation and
notice of IDR initiation response forms, the notice of certified IDR
entity selection form, and the departmental eligibility review), the
Departments would need to implement system changes to the Federal IDR
portal to ensure parties are able to submit the open negotiation notice
through the portal to the other party and the Departments, and to allow
for a response from the non-initiating party. The Departments estimate
that their costs to implement all portal system changes described in
these proposed rules would be approximately $11,000,000 in fiscal year
2024. While some plans or issuers have created their own proprietary
portals to facilitate open negotiations, providers, facilities, and
providers of air ambulance services are not required to use them, and
the Departments are of the view that there would be significant
efficiencies in having one central location where providers,
facilities, and providers of air ambulance services could initiate open
negotiations across all plans and issuers.
The Departments estimate that these proposed rules would increase
burden and create burden for the parties submitting the open
negotiation notice and the proposed open negotiation response
notice.\202\ The total burden associated with these new requirements
for parties would be 420,000 hours at a cost of $44,079,000 in 2024 and
840,000 hours at a cost of $88,158,000 annually beginning in 2025. The
burden associated with this information collection is discussed further
in section V.F.3. of this preamble.
---------------------------------------------------------------------------
\202\ OMB Control Number: 1210-0169 (No Surprises Act: IDR
Process).
---------------------------------------------------------------------------
The Departments seek comment on these costs and any other burdens
interested parties foresee resulting from this proposal.
d. Initiating the Federal IDR Process and Notice of IDR Initiation
The Departments are proposing changes impacting the process for
initiating the Federal IDR process and the notice of IDR initiation.
The cost associated with updates to the Federal IDR portal for IDR
initiation are described in the previous section V.D.2.c. regarding
open negotiation costs. The Departments are proposing these changes to
accelerate dispute processing and reduce the burden on certified IDR
entities. Specifically, the Departments propose to require the
initiating party to provide additional information and supporting
documentation on the notice of IDR initiation. The Departments also
propose to require the non-initiating party to provide a response to
the notice of IDR initiation within 3 business days of the date of IDR
initiation that must include an enumerated list of information with
additional disclosures, including a statement agreeing to the preferred
certified IDR entity or providing an alternative preferred certified
IDR entity, information regarding the eligibility of the item or
service subject to the dispute, and supporting documentation. These
proposals would increase the administrative burden for parties as they
add information requirements that parties must submit at the initiation
of the Federal IDR process. The Departments estimate that the total
combined burden associated with the new requirements for all parties
would be 315,000 hours at a cost of $33,059,250 in 2024 and 630,000
hours at a cost of $66,118,500 annually beginning in 2025. The burden
associated with this information collection is discussed further in
section V.F.4.a. of this preamble.
e. Certified IDR Entity Selection
The Departments propose to amend the process for the preliminary
selection of the certified IDR entity and the submission of the notice
of certified IDR entity selection. Specifically, under these proposed
rules, the Departments propose that the non-initiating party must agree
or object to the preferred certified IDR entity in the notice of IDR
initiation response within 3 business days after the date of IDR
initiation as discussed in section II.D.2.b. of this preamble. Due to
this proposed change, the initiating party would only be required to
submit the notice of certified IDR entity selection if the non-
initiating party submits an alternative preferred certified IDR entity
in the notice of IDR initiation response. The initiating party
[[Page 75822]]
would submit its notice agreeing or objecting to the non-initiating's
alternative preferred certified IDR entity through the Federal IDR
portal. The non-initiating party would only be required to submit the
notice of certified IDR entity selection if the initiating party
provides an alternative preferred certified IDR entity in the notice of
certified IDR entity selection within the 3-business-day period
following the date of IDR initiation. As such, the burden associated
with this collection would be increased by approximately $418,621 and
is described further in section V.F.4.b. of this preamble.
f. Federal IDR Eligibility Determinations
The Departments propose amending 26 CFR 54.9816-8(c)(1)(v), 29 CFR
2590.716-8(c)(1)(v), and 45 CFR 149.510(c)(1)(v) to make Federal IDR
process eligibility determinations the responsibility of the
Departments in certain circumstances, at the discretion of the
Departments. Under this proposal to invoke a departmental eligibility
review when certain criteria are met as discussed in section II.E.1.b.
of this preamble, following IDR initiation, the Departments would
evaluate whether the dispute is eligible for the Federal IDR process
and make an eligibility determination. If the dispute is found to be
eligible, the Departments would send it to the certified IDR entity to
continue the Federal IDR process. If the dispute is found to be
ineligible for the Federal IDR process, it would be closed.
By assuming the responsibility for Federal IDR process eligibility
determinations, the Departments would incur costs that have thus far
been incurred primarily by certified IDR entities. Therefore, it is
important to note that these costs generally represent a transfer of
costs (from certified IDR entities to the Departments) rather than
actual new costs associated with the Federal IDR process. It is equally
important to note that the Departments cannot quantify the full extent
of these costs as they are now being incurred by certified IDR
entities, and the Departments are not privy to their finances. As such,
these estimates should be considered as the Departments' best
approximations based on limited information.
These costs would vary depending on whether the departmental
eligibility review for Federal IDR process eligibility determinations
is in effect or not and may also vary considerably based on Federal IDR
process dispute volume. When the departmental eligibility review is not
in effect, the Departments would incur fewer costs, as they would not
be responsible for Federal IDR process eligibility determinations. The
Departments estimate that they would incur a one-time ``startup'' cost
for system and operations development in the first year beginning when
these proposed rules are finalized and go into effect, which is
included in the cost of the overall Federal IDR portal build described
in section V.D.2.c. of this preamble, and ongoing operations and
maintenance costs of $463,320 annually thereafter. When the
departmental eligibility review is in effect, the Departments would be
making eligibility determinations for disputes submitted to the Federal
IDR process, which would incur a much higher level of burden, including
responsibilities such as regulatory analysis, outreach, quality
assurance, administrative activities, and close coordination among
multiple parties. The Departments estimate that this would cost
approximately $17,199,000 in 2024 and $41,277,600 per year beginning in
2025. The Departments wish to reiterate the draft nature of these
estimates and their strong dependency on Federal IDR process volume,
which is highly challenging to predict. As such, the Departments
encourage comment and feedback.
g. Withdrawals
The Departments propose to add 26 CFR 54.9816-8(c)(3)(ii), 29 CFR
2590.716-8(c)(3)(ii), and 45 CFR 149.510(c)(3)(ii) to establish a
process for disputes to be withdrawn from the Federal IDR process. If
the withdrawal is not agreed upon by both parties, these proposed rules
would require the initiating party to submit a withdrawal request to
the Departments and the non-initiating party through the Federal IDR
portal. The non-initiating party would then be required to provide a
response within 5 business days indicating agreement or objection to
the request for withdrawal. If the non-initiating party fails to
respond within 5 business days of the initiating party's request, the
non-initiating party would be considered to have agreed to the
dispute's withdrawal. This new collection would result in a cost to the
parties of $455,196 in 2024 ($372,120 for initiating parties and
$83,076 for non-initiating parties) and $910,392 ($744,240 for
initiating parties and $166,152 for non-initiating parties) annually
beginning in 2025, as discussed further in section V.F.6. of this
preamble.
h. Treatment of Batched Items and Services
The Departments propose to amend the batching policies in response
to the Departments' experiences with batched determinations and
operationalizing the Federal IDR process, as well as consideration of
interested parties' feedback regarding the Federal IDR process. Under
this proposal, the Departments would allow parties the flexibility to
batch qualified IDR items and services (or ``line items'') that relate
to the treatment of a similar condition with necessary limitations to
encourage efficiency. Specifically, the policy would allow all
qualified IDR items and services to be batched by: (1) items and
services furnished to a single patient during a patient encounter on
one or more consecutive dates of service and billed on the same claim
form (single patient encounter); (2) items and services furnished to
one or more patients and billed under the same service code, or a
comparable code under a different procedural code system; or (3)
anesthesiology, radiology, pathology, and laboratory IDR items and
services furnished under service codes belonging to the same Category I
CPT code range, as specified in guidance by the Departments, in order
to address the unique circumstances of certain medical specialties and
provider types.
To implement this proposal, the Departments would need to implement
system changes to the Federal IDR portal to ensure that the ability to
batch under the new rules is operationalized. The total cost to
implement system changes associated with submitting information through
the portal, including those related to batching, is described in the
open negotiation cost section of these proposed rules (section V.D.2.c.
of this preamble). While the Federal IDR portal currently has batching
capabilities, these proposed rules would allow for additional
permissible mechanisms of batching which would need to be collected and
captured in the Federal IDR portal.
i. Administrative Fee Collection
i. Establishment of the Administrative Fee Amount and Methodology
The Departments propose revisions to the methodology for setting
the administrative fee and propose new reduced administrative fee
amounts. If the IDR Process Fees proposed rules are finalized as
proposed, the administrative fee in effect in calendar year 2024 would
be $150 per party per dispute.\203\ Based on internal Federal IDR
process data and estimating the impact of TMA IV's vacatur of the
[[Page 75823]]
batching regulations at 26 CFR 54.9816-8T(c)(3)(i)(C), 29 CFR 2590-716-
8(c)(3)(i)(C), and 45 CFR 149.510(c)(3)(i)(C), the Departments estimate
that approximately 225,000 disputes are closed per year. Therefore, if
the administrative fee as proposed in the IDR Process Fees proposed
rule, if finalized, were to remain applicable, disputing parties would
pay approximately $67,500,000 in administrative fees annually (225,000
disputes x 2 parties per dispute x $150 per party).
---------------------------------------------------------------------------
\203\ Federal Independent Dispute Resolution (IDR) Process
Administrative Fee and Certified IDR Entity Fee Ranges proposed
rules, 88 FR 65888 (September 26, 2023).
---------------------------------------------------------------------------
In these proposed rules, the Departments are proposing an
administrative fee of $150 per party per dispute, a reduced
administrative fee of $75 for both parties in low-dollar disputes, and
a reduced administrative fee of $30 for non-initiating parties in
ineligible disputes for disputes initiated on or after January 1, 2025.
The Departments are also proposing to collect the administrative fee
directly from the parties closer to the time of initiation rather than
the time a dispute is closed.
The Departments project a total of 420,000 disputes would be
initiated annually based on internal data, which includes 65,520
disputes for which both parties would pay the reduced administrative
fee for low-dollar disputes, 18,480 disputes for which the initiating
party would pay the reduced administrative fee for low-dollar disputes
and the non-initiating party would pay the reduced administrative fee
for ineligible disputes, 73,920 disputes for which the initiating party
would pay the full administrative fee and the non-initiating party
would pay the reduced administrative fee for ineligible disputes, and
262,080 disputes for which both parties would pay the full
administrative fee. Thus, based on this data and assuming the number of
disputes remains stable year over year and the administrative fee
amounts are not subsequently changed through notice and comment
rulemaking, the Departments estimate that disputing parties would pay
approximately $103,698,000 in administrative fees annually beginning in
2025.\204\ Therefore, the costs associated with this proposal would be
approximately $36,198,000 annually beginning in 2025 ($103,698,000 if
this proposal is finalized -$67,500,000 if the baseline condition under
the IDR Process Fees proposed rules, if finalized, were to continue).
---------------------------------------------------------------------------
\204\ This is calculated as follows: (65,520 disputes x 2
parties per dispute x $75 per party) + {18,480 disputes x [(1 party
per dispute x $75 per party) + (1 party per dispute x $30 per
party)]{time} + {73,920 disputes x [(1 party per dispute x $150 per
party) + (1 party per dispute x $30 per party)]{time} + (262,080
disputes x 2 parties per dispute x $150 per party) = $103,698,000.
---------------------------------------------------------------------------
The Departments seek comment on these estimates and assumptions.
ii. Time of Collection of Administrative Fee and Certified IDR Entity
Fee
The Departments are proposing to amend the provisions related to
the time of administrative fee collection such that an initiating party
would be required to pay the non-refundable administrative fee within 2
business days of the date of preliminary selection of the certified IDR
entity, and the non-initiating party would be required to pay the non-
refundable administrative fee within 2 business days after a notice of
an eligibility determination. Because initiating parties are not
required to pay the administrative fee until offer submission under
current guidance, some initiating parties fail to pay this fee for
ineligible disputes. Although the Departments anticipate that this
proposal would result in all initiating parties paying their
administrative fee because the administrative fees are always non-
refundable and incurred when preliminary selection of the certified IDR
entity is complete, the Departments are of the view that the impact of
this proposed change would be minimal on initiating parties, as
compared to the existing regulation, associated burden analysis, and
approved Paperwork Reduction Act Supporting Statement, which provide
for all administrative fees to be non-refundable and to be paid in
every dispute submitted. Under these proposed rules, if an initiating
party fails to pay the required administrative fee within 2 business
days of preliminary selection of the certified IDR entity, the dispute
would be closed and neither disputing party would owe the
administrative fee; thus, a dispute opened by an initiating party that
fails to timely pay the administrative fee is treated as a provisional
dispute that does not proceed through the full Federal IDR process.
Further, the Departments anticipate that this proposal would result in
almost all non-initiating parties paying their administrative fee
because of associated penalties for nonpayment, including that their
offer would not be considered received, the non-initiating party would
still be responsible for paying the administrative fee, and the unpaid
administrative fee would be subject to Federal debt collection
procedures.
Currently, approximately 40 percent of non-initiating parties do
not pay the administrative fee. Under these proposed changes, the
Departments estimate a total of 420,000 disputes would be initiated
annually. However, the Departments are of the view that extrapolating a
40 percent cost increase to non-initiating parties would not be
appropriate. Specifically, the combination of policies proposed in
these rules, including attestation of eligibility during open
negotiation and requiring the initiating party to pay the
administrative fee at preliminary selection of the certified IDR
entity, are designed to reduce the number of ineligible disputes
submitted (as further described in section V.D.1.l. of this preamble),
which are the disputes for which parties are often not paying the
associated administrative fees. This proposal would be implemented in
tandem with the requirements that non-initiating parties respond to the
notice of IDR initiation, and the estimated amount of time for the non-
initiating party to submit payment would be included in the estimated
amount of time for the non-initiating party to submit the notice of IDR
initiation response proposed in these rules. This amount of time is
discussed further in section V.F.4.a. of this preamble.
The Departments are of the view that, if these proposed rules are
finalized, initiating parties would submit fewer ineligible disputes,
which would decrease the expenses incurred by the Departments and
certified IDR entities to review eligibility information. In addition,
parties would pay the required administrative fees in a higher
percentage of disputes. However, at the same time, there would be fewer
disputes to review, so fewer administrative fees would be collected.
Overall, the Departments are of the view that this proposal would
ensure that the costs of using the Federal IDR process are being
equitably allocated to both eligible and ineligible disputes.
iii. Manner of Administrative Fee Collection
The proposal for the Departments to directly collect the
administrative fee from disputing parties would increase the activities
required to be accounted for in the administrative fee, as the
Departments' costs associated with this collection would need to be
included in that fee. The Departments estimate that there would be an
implementation cost of approximately $3,000,000 for system and
operations development related to administrative fee collection in FY
2024, and ongoing operations and maintenance costs of approximately
$2,500,000 in FY 2025, $1,250,000 in FY 2026, $1,000,000 in FY 2027,
and $1,000,000 in FY 2028. Because the Federal IDR process is intended
to be
[[Page 75824]]
self-sustaining, once the administrative fee calculation is adjusted,
there would be no financial impact to the Federal Government. Although
the Departments are of the view that requiring disputing parties to pay
the administrative fee directly to the Departments, instead of to
certified IDR entities, would not impose an additional administrative
burden on disputing parties, the Departments acknowledge that any
increased fee that could potentially result from this proposal could
impact disputing parties. The Departments seek comment on these
assumptions, including any burden increase associated with this process
and whether that potential burden would be offset by a reduction of the
administrative fee based on a higher collection rate of the
administrative fee from disputing parties.
iv. Application of Federal IDR Process Requirements in Circumstances
Involving a Failure To Pay Certified IDR Entity Fees or Administrative
Fees
The Departments propose to clarify how the Federal IDR process
applies when either party fails to timely pay the fees associated with
the Federal IDR process. Specifically, the failure to pay the
administrative fee by an initiating party would result in the closure
of the dispute, and nonpayment of the certified IDR entity fee by the
initiating party would result in the certified IDR entity not
considering the initiating party's offer. Nonpayment of the certified
IDR entity or administrative fee by a non-initiating party would result
in the certified IDR entity not considering the non-initiating party's
offer. The Departments are of the view that the impact of this change
would be minimal for the parties, as the purpose of this policy is to
clarify the sub-regulatory guidance that already exists and allow
closure of disputes in which the initiating party does not provide the
appropriate administrative fee payment. Further, the Departments are of
the view that it would take a de minimis amount of time for the
initiating and non-initiating parties to include their taxpayer
identification numbers, which would be required to link debts owed by
the disputing parties to the Departments, on the notice of IDR
initiation and the notice of IDR initiation response.
v. Administrative Fee Structure for Disputing Parties in Low-Dollar
Disputes
The Departments propose to charge the parties a reduced
administrative fee when the initiating party attests that the highest
offer made during open negotiation by either party was less than the
predetermined threshold as discussed further in section II.E.3.e. of
this preamble. Because a reduction of the administrative fee would be
applied to both parties when a low-dollar dispute is initiated, the
Departments are of the view that the impact of this change would be
minimal for most parties when combined with the proposal to expand
batching, because these policies combined would result in fewer single
low-dollar disputes being initiated. Furthermore, this proposal would
reduce costs for certain parties to participate in the process, namely
parties that provide low-dollar items or services and are unable to
batch a sufficient number of items and services together to benefit
from the batching proposals in these rules.
This proposal would require initiating parties to attest (for
example, by checking a box) in the Federal IDR portal that no offer
made by either party during open negotiation exceeded a predetermined
threshold. The Departments are of the view that this action would only
take a de minimis amount of time for the initiating party to complete,
perhaps a minute, and therefore would result in negligible costs. This
amount of time is minimal and is captured in the total time it takes to
initiate the dispute--2.25 hours, as discussed further in the PRA
package for the Federal IDR process (OMB control number: 1210-0169).
This proposal may also increase the burden on the Federal Government
due to the costs to complete system updates to account for this
proposal, but the Departments anticipate that these costs would be
incurred in tandem with changes to the other system build costs
discussed in these proposed rules; thus, those costs are included in
the cost estimates for the proposed changes related to open negotiation
in section V.D.2.c. of this preamble. Furthermore, the Departments are
of the view that the benefit of making the Federal IDR process more
accessible to all types of providers, such as providers of low-dollar
services, outweighs the limited costs to HHS to modify its system
build.
vi. Administrative Fee Structure for Non-Initiating Parties in
Ineligible Disputes
Additionally, the Departments propose to charge the non-initiating
party a reduced administrative fee when either the certified IDR entity
or the Departments determine the entire dispute is not eligible for the
Federal IDR process. Because a reduction of the administrative fee
would be applied to the non-initiating party when a dispute is
ineligible for the Federal IDR process, the Departments are of the view
that the impact of this change would be minimal for two reasons. First,
under the current process, certified IDR entities often do not collect
the administrative fee in these disputes; however, non-paying parties
have been on notice that this fee was due even if they did not pay at
the appropriate time. Second, policies such as requiring an attestation
of eligibility during open negotiation and requiring the initiating
party to pay the administrative fee at preliminary selection of the
certified IDR entity are designed to reduce the number of ineligible
disputes (as further described in section V.D.1.l. of this preamble)
such that non-initiating parties would be assessed an administrative
fee in fewer ineligible disputes. Because this process may incentivize
non-initiating parties to timely challenge dispute eligibility during
open negotiation, this may better capture the costs associated with the
parties.
Further, the burden on disputing parties is dependent on whether
the administrative fee is increased or decreased, which is a byproduct
of estimated total annual expenditures by the Departments. In the event
of a substantial change in payment of the administrative fee based on
the volume of ineligible disputes or associated expenditures, which
would impact the calculation of the administrative fee, the parties may
incur an increased or decreased administrative fee to cover the costs
to carry out the Federal IDR process. The Departments seek comment on
potential impacts to disputing parties and certified IDR entities of
any change in burden from this policy, including any modifications to
internal operating procedures that may be required to implement this
fee structure.
j. Extension of Time Periods for Extenuating Circumstances
The Departments propose to establish that the Departments, or at
the request of a certified IDR entity or a party, would determine
whether an extension is necessary because the parties or certified IDR
entity cannot meet applicable timeframes due to matters beyond the
control of the certified IDR entity or one or both parties, or for
other good cause. The process for requesting an extension due to
extenuating circumstances would remain the same as when this process
was established in the October 2021 interim final rules, and entities
would continue to submit the Request for Extension due to Extenuating
Circumstances form through the Federal IDR portal.
[[Page 75825]]
However, based on the proposed changes to this policy, the Departments
estimate that the number of respondents would increase due to the
addition of certified IDR entities, thus slightly increasing the total
burden associated with this collection. The Departments estimate that
the costs associated with certified IDR entity requests for the
extension would be $99 in 2024 and $197.80 annually beginning in 2025.
This cost is explained in further detail in section V.F.8. of this
preamble.
k. Registration of Group Health Plans and Health Insurance Issuers
Establishing the Federal IDR registry would impose a cost on the
Departments by requiring them to develop and build the registry. The
Departments anticipate incurring a cost of approximately $3,000,000 to
develop and build the Federal IDR registry in FY 2024, with annual
ongoing costs to maintain the registry of $150,000 on average
thereafter. Additionally, enrolling in the Federal IDR registry would
impose a cost on issuers and plans by requiring them to submit
information to the Departments. These costs amount to $1,573,693 in
2024 and $94,252 annually beginning in 2025 and are further described
in section V.F.9. of this preamble.
3. Uncertainties
While the Departments are of the view that the majority of issuers
and TPAs have the capability to use single CARC and RARC combinations
on ERA transactions, the Departments are uncertain about the current
level of use within the industry and whether issuers and TPAs have the
capability to incorporate this information on paper remittance advice.
Further, the Departments are uncertain about the current capability or
percentage of issuers and TPAs that have the ability to use multiple
CARC and RARC combinations for individual line items, including on
electronic and paper remittance advice; what barriers and challenges
issuers and TPAs would face to implement and operationalize this
capability; and whether substantial system changes would need to be
implemented to effectuate this proposed policy.
It is unclear whether the Federal IDR process would experience the
same operating conditions, such as the number of ineligible disputes
submitted or the number of disputes that would be closed for nonpayment
of the administrative fee, if all or some of the policies proposed in
these proposed rules are finalized and implemented. While these factors
would have a direct impact on the expenditures made by the Departments
to carry out the Federal IDR process, it is difficult to project the
impact that may result to the administrative fee amount charged to the
parties. It is also uncertain how many disputes would be considered
low-dollar disputes in the future, which would impact how many parties
would be charged the proposed reduced administrative fee for low-dollar
disputes, and it is uncertain how many disputes would be determined
ineligible if the proposals in these rules are finalized, which would
impact how many non-initiating parties would be charged the proposed
reduced administrative fee for ineligible disputes.
Furthermore, it is unclear if or when the proposed departmental
eligibility review, which would allow the Departments to make
eligibility determinations rather than certified IDR entities, may need
to be invoked. The departmental eligibility review would impact dispute
processing times and overall certified IDR entity operations; further,
these factors may impact what percentage of disputes are settled or
withdrawn after initiation but before offer submission.
The economies of scale that may be realized by batching qualified
IDR items and services are uncertain, including whether there would be
a reduction in the amount of fees each party has to pay since parties
would generally be allowed to batch more items and services in a single
dispute than under the vacated provisions (discussed in section II.E.2.
of this preamble). The specific provisions of the batching proposal may
have differing effects on the trends in dispute initiation overall. For
example, the increased flexibility to batch based on a single patient
encounter may increase initiation of batched disputes, while the
proposed cap on the number of line items within a batch may require
parties that previously submitted batches with a high number of line
items to divide the claims across multiple batched disputes. Further,
the Departments are of the view that the increased batching
flexibilities in concert with the reduced administrative fee for low-
dollar disputes, if finalized, could lead to an increase in disputes
initiated, since these policies may result in the Federal IDR process
becoming more accessible to providers and payers. For these reasons,
the Departments recognize the uncertainty in estimating the potential
impact on the number of disputes submitted, and thus the fees
collected, due to the proposed batching provisions. Further, it is
uncertain if increased batching would lead to decreased collection of
funds by the Departments if fewer administrative fees are paid.
It is uncertain how much time would be needed for plans, issuers,
carriers, and TPAs to collect the registration information that they
would be required to provide under these proposed rules. Furthermore,
it is unclear how many group health plans would choose to self-register
for the proposed IDR registry, rather than relying on a TPA or other
third party to register on their behalf. If a significant number of
group health plans self-register, this may increase the burden to
industry as well as the operational burden to the Departments to create
and maintain the registry.
Although the Departments have analyzed the last 12 months of
Federal IDR process data available to inform their projections, it is
uncertain if the trends in this data will remain applicable for two
reasons. First, the Federal IDR process is still in an early phase of
implementation and has not yet achieved the stabilization that occurs
with long-term uptake of the process. Initially, the Departments
estimated that approximately 22,000 disputes would be submitted to the
process each year; \205\ uptake of the process, however, has rapidly
outpaced that estimate as dispute initiations have grown exponentially
since implementation, and analysis has revealed an estimated number
closer to 420,000 annual disputes \206\ would have been more accurate.
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\205\ In the regulatory impact analysis of the October 2021
interim final rules, the Departments estimated that 17,333 disputes
involving non-air ambulance services and 4,899 disputes involving
air ambulance services would be submitted to the Federal IDR process
during the first year of implementation, totaling 22,232 anticipated
disputes.
\206\ Federal Independent Dispute Resolution Process--Status
Update. Centers for Medicare & Medicaid Services. April 27, 2023.
https://www.cms.gov/files/document/federal-idr-processstatus-update-april-2023.pdf.
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Second, although each of the proposed provisions could be
implemented separately and is severable, when reviewed holistically,
implementation of these proposed policies would create comingled
impacts, including on the number and type of disputes initiated, such
that it is uncertain what the overall collective impact of these
proposed policies would be. For example, although the Departments
project a 50 to 75 percent decrease in the number of ineligible
disputes as discussed further in section V.D.1.l. of this preamble,
other policies such as expanded batching and the reduced administrative
fee for low-
[[Page 75826]]
dollar disputes are anticipated to increase access to the Federal IDR
process, such that the total number of disputes initiated yearly may
increase overall. Additionally, the proposed framework for
administrative fees that, if finalized, would result in a reduced
administrative fee for some disputing parties when a dispute is
ineligible or low-dollar complicates the analysis of what types of
disputes would be initiated under these proposed rules. Further, the
policies designed to increase communication between the disputing
parties, such as the registry, open negotiation, and dispute initiation
provisions, are anticipated to reduce the number of ineligible disputes
initiated and increase the number of disputes resolved through open
negotiation. However, the Departments are uncertain whether additional
parties will utilize the Federal IDR process due to these process
improvements, which would ultimately bring more disputes into the
process.
Overall, some of the proposed policies may reduce the number of
disputes while others may increase the number of disputes initiated.
Additionally, whether there will be a reduction in costs to the
disputing parties is also uncertain under these collective proposals.
For example, a provider that previously felt that the nature of their
practice made it infeasible to initiate a dispute due to financial
concerns may find the Federal IDR process more financially accessible
under the proposed reduced administrative fee framework, thus incurring
the associated cost and administrative fees and increasing the annual
dispute number.
4. Regulatory Review Cost Estimation
If regulations impose administrative costs on entities, such as the
time needed to read and interpret rules, regulatory agencies should
estimate the total cost associated with regulatory review. Based on
comments received for the July 2021 interim final rules and October
2021 interim final rules, the Departments estimate that more than 2,100
entities will review these proposed rules, including 1,500 issuers, 205
TPAs, and at least 395 other interested parties (for example, State
insurance departments, State legislatures, industry associations,
advocacy organizations, and providers and provider organizations). The
Departments acknowledge that this assumption may understate or
overstate the number of entities that will review these proposed rules.
Using the mean hourly wage rate from the Bureau of Labor Statistics
for a Lawyer (Code 23-1011) to account for average labor costs
(including a 100 percent increase for the cost of fringe benefits and
other indirect costs), the Departments estimate that the cost of
reviewing these proposed rules would be $157.48 per hour.\207\ The
Departments estimate, based on an average reading speed of 200 to 250
words per minute, that it would take each reviewing entity
approximately 10 hours to review these proposed rules, with an
associated cost of approximately $1,574.80 (10 hours x $157.48 per
hour). Therefore, the Departments estimate that the total burden to
review these proposed rules will be approximately 21,000 hours (2,100
reviewers x 10 hours per reviewer), with an associated cost of
approximately $3,307,080 (2,100 reviewers x $1,574.80 per reviewer).
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\207\ Centers for Medicare & Medicaid Services. (May 1, 2022).
May 2022 National Occupational Employment and Wage Estimates.
https://www.bls.gov/oes/current/oes_nat.htm.
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The Departments welcome comments on this approach to estimating the
total burden and cost for interested parties to read and interpret
these proposed rules.
E. Regulatory Alternatives--Departments of Health and Human Services
and Labor
In developing these proposed rules, the Departments considered
various alternative approaches.
1. Required Use of CARCs and RARCs
The Departments considered applying the proposed requirement to use
CARCs and RARCs under new 26 CFR 54.9816-6A, 29 CFR 2590.716-6A, and 45
CFR 149.100 only to claims subject to the surprise billing protections
of the No Surprises Act. However, the Departments have become aware
that providers, facilities, and providers of air ambulance services
have sought to initiate open negotiations or the Federal IDR process
for a sizeable number of claims that are not subject to the No
Surprises Act. Therefore, the Departments have concluded that it would
be helpful for plans and issuers to communicate information regarding
the applicability of the No Surprises Act for all out-of-network
claims, and that a narrower application would be less impactful. Thus,
the proposed approach may reduce the number of ineligible claims
submitted, as further described in section V.D.1.l. of this preamble.
The Departments considered specifying in regulation which CARCs and
RARCs must be used, rather than providing this information in guidance.
The Departments are working to understand and address the current
backlog of disputes slowing down the Federal IDR process. The
Departments have concluded that retaining the flexibility to identify
the CARCs and RARCs to be used in specified scenarios in guidance
rather than through notice and comment rulemaking would provide greater
ability to quickly address communication gaps that are contributing to
this backlog and future implementation challenges, as the Departments
better understand these gaps. This also mirrors the current approach
for required CARC and RARC code combinations that must be used by
HIPAA-covered entities in business scenarios, as specified in guidance.
The Departments also considered continuing to support the voluntary
use of No Surprises Act-specific RARCs. The Departments recognize the
additional burden that requiring certain RARCs may place on small
entities that may have fewer dedicated IT and coding staff. However,
since the RARC Committee approved a set of RARCs for optional use,
effective March 1, 2022, providers, facilities, and providers of air
ambulance services and plans and issuers have continued to report
communication challenges and to request more standardized mechanisms
for communicating information. The Departments concluded that requiring
certain CARCs and RARCs in specific circumstances, as well as
continuing to permit the use of voluntary RARCs at the discretion of
plans and issuers, would provide a more effective means of
standardizing communication and better achieve a number of aims,
including improving information flow between plans and issuers and
providers, facilities, and providers of air ambulance services and
consequently reducing the submission of ineligible claims to the
Federal IDR process.
2. Open Negotiation Provision Changes (26 CFR 54.9816-8(b)(1), 29 CFR
2590.716-8(b)(1), and 45 CFR 149.510(b)(1))
The Departments propose to amend the open negotiation provisions at
26 CFR 54.9816-8(b)(1)(i), 29 CFR 2590.716-8(b)(1)(i), and 45 CFR
149.510 (b)(1)(i) to require the party initiating open negotiations to
provide an open negotiation notice and supporting documentation to the
other party and the Departments to initiate the open negotiation
period. Furthermore, the party in receipt of the open negotiation
notice would be required to provide a response to the open negotiation
notice to the other party and the Departments no later than the 15th
business day of the 30-business-day open negotiation period.
[[Page 75827]]
The Departments considered alternative ways for the party
initiating open negotiation to notify the Departments of the initiation
of open negotiations instead of submitting the notice through the
Federal IDR portal. The Departments considered having the party
submitting the open negotiation notice notify the Departments via mail
or email but decided that the portal would provide a more logical place
for the notice to be provided, as this is where Federal IDR process
information is stored. The Departments also considered taking no action
and maintaining the current process in which parties initiating open
negotiation do not inform the Departments directly of the initiation of
open negotiations. However, the Departments are of the view that these
changes are necessary to make it explicitly clear to the Departments
when open negotiations are initiated in order to best track the flow of
Federal IDR process dispute initiations. The Departments are of the
view that these proposals would create more certainty regarding whether
and when the party initiating open negotiation begins open negotiations
by ensuring that start and end dates are documented in the Federal IDR
portal, which is the official place of record for the Federal IDR
process. Further, the Departments acknowledge the additional burden
that small entities may face in meeting the requirements of the Federal
IDR process since they may not have dedicated staff to perform all the
functions necessary to meet the requirements. However, the Departments
are of the view that the proposed policy to centralize the submission
of open negotiation notices through the Federal IDR portal would
alleviate burden on small entities as it would reduce the number of
channels they previously submit these notices through.
The Departments also considered alternatives to requiring the party
in receipt of the open negotiation notice to provide a response to the
open negotiation notice within the 30-business-day open negotiation
period. The Departments considered maintaining the status quo of not
requiring this response, but are of the view that creating this
requirement would be the better alternative, because this proposal
would create an additional exchange of eligibility-related disclosures
between the parties and foster better communication between the parties
to improve the Federal IDR process.
The Departments also propose to require that the open negotiation
notice contain additional specific information and be in a specific
format as discussed in section II.D.1.c. of this preamble. The
Departments further propose to require that the open negotiation
response notice must be provided, using the standard form developed by
the Departments, no later than the 15th business day of the 30-
business-day open negotiation period, and the party in receipt of the
open negotiation notice must provide the open negotiation response
notice through the Federal IDR portal resulting in receipt by the party
initiating open negotiation and the Departments on the same day. The
Departments considered maintaining the status quo and not requiring the
additional information, the specific format, or timing, but determined
that this proposal would create an additional exchange of information
necessary to help the Federal IDR process be successful, allow
certified IDR entities to make more informed decisions, and improve
communication between the parties.
3. Changes to the Initiation of the Federal IDR Process and the Notice
of IDR Initiation (26 CFR 54.9816-8(b)(2), 29 CFR 2590.716-8(b)(2), and
45 CFR 149.510(b)(2))
The Departments propose to amend the IDR initiation provisions of
26 CFR 54.9816-8(b)(2), 29 CFR 2590.716-8(b)(2), and 45 CFR
149.510(b)(2) to accelerate dispute processing and reduce the burden on
certified IDR entities. Specifically, the Departments propose to
require the initiating party to provide an enumerated list of
additional information on the notice of IDR initiation, including a
statement describing the aspects of the claim, such as patient acuity
or level of training, any payment discussed by the parties during open
negotiation, whether the reasons for initiating the Federal IDR process
are different from the aspects of the claim discussed during the open
negotiation period, and an explanation of why the party is initiating
the Federal IDR process.
Similarly, the Departments propose to require the non-initiating
party to provide a response to the notice of IDR initiation, within 3
business days after the date of IDR initiation, that must include an
enumerated list of information, including an agreement or disagreement
that the dispute is eligible for the Federal IDR process, supporting
documentation if the non-initiating party believes a dispute is not
eligible, and an agreement to the preferred certified IDR entity
identified in the notice of IDR initiation or an alternate preferred
certified IDR entity selection.
The Departments propose to require these notices to be provided to
the other party and the Departments electronically through the Federal
IDR portal.
The Departments considered alternatives to these notices and the
information they are required to contain, including contemplating
notices that contained less required information. Recognizing the
increased administrative burden of providing this additional
information within the specified timeframe, particularly for small
entities that may regularly engage with the IDR process and may not
have staff dedicated to perform this function, the Departments also
considered maintaining the status quo, but instead determined that
these notices are necessary to address processing and communication
issues caused by the lack of information. These new requirements would
provide information to the certified IDR entities that is frequently
missing under the status quo.
Each of the new required elements would provide specific
information needed by the certified IDR entities to successfully
conduct the Federal IDR process. The lack of these information elements
creates a burden on the certified IDR entities, as they are currently
required to undertake concerted efforts to obtain the information from
the parties or other sources. This has resulted in additional time and
effort for the certified IDR entities and caused the process to move at
a slower pace than is desired. The Departments are of the view that
requiring the parties to provide these notices and the information
contained in them within the timeframes and in the manner proposed
would result in a reduction in this burden on the certified IDR
entities and would result in greater efficiency of the Federal IDR
process overall. Additionally, the Departments are of the view that
these additional elements would assist in determining whether the items
or services associated with the dispute are eligible for the Federal
IDR process, allow for a streamlined process to track dispute
initiation, enhance communication between the parties, and facilitate a
more efficient process of IDR initiation.
4. Certified IDR Entity Selection (26 CFR 54.9816-8(c)(1), 29 CFR
2590.716-8(c)(1), and 45 CFR 149.510(c)(1))
The Departments propose to establish a process for the preliminary
selection of the certified IDR entity and final selection of the
certified IDR entity at 26 CFR 54.9816-8(c)(1), 29 CFR 2590.716-
8(c)(1), and 45 CFR 149.510(c)(1).
[[Page 75828]]
Specifically, the Departments propose amending the preliminary
selection of the certified IDR entity process to establish that if the
party last in receipt of either the notice of IDR initiation response
or the notice of certified IDR entity selection received the notice on
the third business day after the date of IDR initiation and did not
agree to the other party's alternative preferred certified IDR entity
by the end of third business day after the date of IDR initiation, the
Departments would provide the party 2 additional business days to agree
or object to other party's alternative preferred certified IDR entity
selection. Further, the Departments propose to clarify that the date of
preliminary selection of the certified IDR entity would be 3 business
days after the date of IDR initiation if the parties jointly selected a
certified IDR entity, or 6 business days after the date of IDR
initiation if the parties fail to jointly select a certified IDR entity
and the Departments select a certified IDR entity either based on the
agreement (or failure to respond) of the party in receipt of the last
notice (either the notice of IDR initiation response or the notice of
certified IDR entity selection) or through random selection. Lastly,
the Departments propose to establish the process for finalizing
selection of the certified IDR entity at 26 CFR 54.9816-8(c)(1)(iv), 29
CFR 2590.716-8(c)(1)(iv), and 45 CFR 149.510(c)(1)(iv), which would
establish that the date of final selection of the certified IDR entity
is the date the Departments provide notice to the parties that the
preliminarily selected certified IDR entity attests that it meets the
conflict-of-interest requirements.
The Departments considered alternatives to this proposal. The
Departments considered maintaining the status quo and not modifying the
process of selecting a certified IDR entity. However, given that the
current rules allow the conflict-of-interest review to coincide with
the eligibility review, the Departments are of the view that creating a
finalization stage of certified IDR entity selection in the Federal IDR
process would improve efficiency and reduce confusion when completing
certified IDR entity selection. The Departments are of the view that
this proposed policy would not increase burden for disputing parties,
including small entities, as the time period requirement for disputing
parties to jointly select a certified IDR entity is not changing. The
Departments are of the view that the certified IDR entity must be
considered preliminarily selected until it is determined that the
certified IDR entity has no conflict of interest, and that the
conflict-of-interest review should not cut into the time periods for
either disputing party to submit their offers or for the certified IDR
entity to make a payment determination.
5. Federal IDR Eligibility Determinations (26 CFR 54.9816-8(c)(1)(v),
29 CFR 2590.716-8(c)(1)(v), and 45 CFR 149.510(c)(1)(v))
The Departments propose to amend 26 CFR 54.9816-8(c), 29 CFR
2590.716-8(c), and 45 CFR 149.510(c) regarding Federal IDR eligibility
determinations to make the Federal IDR process eligibility reviews the
responsibility of the Departments under certain circumstances. Under
this proposal, when a departmental eligibility review is in effect, the
Departments would determine whether the dispute is eligible for the
Federal IDR process. If the dispute is found to be eligible, the
Departments would send it to the certified IDR entity to continue the
Federal IDR process. If the dispute is found to be ineligible for the
Federal IDR process, it would be closed.
The Departments considered being more involved in the entire
eligibility review process on a permanent basis; however, once the
Federal IDR process arrives at a steadier operational state, the
Departments are of the view that the majority of eligibility work--in
particular eligibility determinations--should be conducted by certified
IDR entities, particularly if the other proposed policies in these
proposed rules and non-regulatory improvements are successful in
improving throughput. The Departments also considered maintaining the
status quo of certified IDR entities performing the full scope of the
eligibility determination process, but the burden of making these
eligibility determinations has proven to be complex and time-consuming
for certified IDR entities, and the statute only affords certified IDR
entities the ability to collect the certified IDR entity fee when a
payment determination is made. A payment determination can only be made
for eligible disputes, so certified IDR entities are not able to keep
any portion of their fee for disputes they determine are ineligible.
This situation results in certified IDR entities being uncompensated
for eligibility determination work on ineligible disputes. The
Departments do not anticipate that this policy, if finalized as
proposed, would have a differential impact on small entities.
Therefore, the Departments are proposing this provision in a manner
that provides the Departments with the flexibility to move the
responsibility for Federal IDR eligibility determinations between the
Departments and certified IDR entities, as appropriate and with
appropriate notice to interested parties.
6. Withdrawals (26 CFR 54.9816-8(c)(3), 29 CFR 2590.716-8(c)(3), and 45
CFR 149.510(c)(3))
The Departments propose to add 26 CFR 54.9816-8(c)(3)(ii), 29 CFR
2590.716-8(c)(3)(ii), and 45 CFR 149.510(c)(3)(ii) to establish a
process for disputes to be withdrawn from the Federal IDR process.
Specifically, the Departments propose that a dispute may be withdrawn
from the Federal IDR process if: (1) the initiating party provides
notification through the Federal IDR portal to the Secretary and the
certified IDR entity (if selected) that both parties agree to withdraw
the dispute from the Federal IDR process, with signatures from
authorized signatories for both parties; (2) the initiating party
provides a standard withdrawal request notice to the Departments, the
certified IDR entity (if selected), and the non-initiating party, and
the non-initiating party notifies the Secretary, certified IDR entity
(if selected), and initiating party of its agreement to withdraw within
5 business days of the initiating party's request (or the non-
initiating party fails to respond within 5 business days of the
initiating party's request); (3) the certified IDR entity or the
Departments cannot determine eligibility because both parties to the
dispute are unresponsive to any requests for additional information to
determine eligibility; or (4) the certified IDR entity cannot make a
payment determination because both parties to the dispute have failed
to submit an offer as described in 26 CFR 54.9816-8(c)(5)(i), 29 CFR
2590.716-8(c)(5)(i), and 45 CFR 149.510(c)(5)(i).
The Departments considered alternatives to this proposal. The
Departments considered maintaining the status quo and not formalizing
the process for disputes to be withdrawn. The Departments recognize
that the withdrawal process may place particular burden on resource
constrained small entities, that may face greater challenges meeting
the timetables described in this proposal. However, given that the
current rules do not establish a clear uniform process for disputes to
be withdrawn, the Departments are of the view that these proposals
would encourage efficiency by creating a centralized process for the
parties to request a withdrawal of a dispute and requiring that the
dispute would be withdrawn in the event the
[[Page 75829]]
parties are nonresponsive within the required timeframes. Further, the
Departments also are of the view that permitting the withdrawal of a
dispute in these cases would decrease the number of payment
determinations the certified IDR entity is required to adjudicate.
7. Treatment of Batched Items and Services (26 CFR 54.9816-8(c)(4), 29
CFR 2590.716-8(c)(4), and 45 CFR 149.510(c)(4))
After considering feedback from interested parties, the Departments
are of the view that the batching rules should be amended to capture
additional efficiencies and expand access to the Federal IDR process,
while avoiding combinations of unrelated claims in a single dispute
that could unnecessarily complicate an IDR payment determination and
operate to reduce efficiency. The Departments also anticipate that
these batching policies, if finalized as proposed, would be
particularly beneficial to small entities. By offering greater
flexibility, these policies will improve the economic cost of the
Federal IDR process and reduce the burden on small entities' billing
and coding staff.
The Departments considered different approaches to expand the
batching rules at proposed 26 CFR 54.9816-8(c)(4), 29 CFR 2590.716-
8(c)(4), and 45 CFR 149.510(c)(4) for determining whether the items or
services are related to treatment of a similar condition. In
particular, the Departments considered approaches that relied on
existing code sets that would capture a wider range of items and
services than those under the current regulations, including the
vacated provisions (discussed in section II.E.2. of this preamble). The
rationale underlying batching based on code sets (or subsets of those
code sets) is that based on the manner in which these code sets were
built (by medical and coding professionals and others), the code sets
present a reasonable basis upon which to conclude that certain sections
(or subsections) of those code sets describe items and services that
are related to the treatment of a similar condition.
The broadest potentially workable standard the Departments
considered for determining whether the items or services are related to
treatment of a similar condition is the Berenson-Eggers Type of Service
(BETOS) codes. The BETOS coding system was originally developed for
analyzing the growth in Medicare expenditures and is not utilized for
the purposes of billing.\208\ The Restructured BETOS Classification
System (RBCS) includes HCPCS Level I codes (commonly referred to as
``CPT codes'') and HCPCS Level II codes (commonly referred to as
``HCPCS codes'') and groups CPT and HCPCS procedural codes into a few
very broad categories: (1) anesthesia, (2) evaluation and management,
(3) procedures, (4) imaging, (5) tests, (6) durable medical equipment,
(7) treatment, and (8) other. However, this could theoretically offer
unlimited batching of services furnished by specialty providers and,
accordingly, result in batches that would be difficult for certified
IDR entities to adjudicate in a timely manner. While this coding system
is stable over time and is relatively immune to minor changes in
technology or practice patterns, this approach would require parties
and certified IDR entities to learn and become familiar with a new
framework for categorizing items and services for the specific purpose
of engaging with the Federal IDR process. The Departments are of the
view that this would result in confusion and an exacerbation of backlog
issues.
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\208\ Centers for Medicare & Medicaid Services. (October 20,
2022). Restructured BETOS Classification System. https://data.cms.gov/provider-summary-by-type-of-service/provider-service-classifications/restructured-betos-classification-system.
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The Departments also considered allowing initiating parties to
batch all items and services with the same ICD-10 diagnosis code. Every
medical claim includes at least one ICD-10 diagnosis code, including a
primary diagnosis code and optional secondary diagnosis codes. There
are approximately 68,000 ICD-10 diagnosis codes that cover a wide
variation in patient diagnoses. Given the wide variation in diagnoses
and the fact that a single ICD-10 diagnosis code can cover a wide range
of individual items or services, it is conceivable that diagnosis codes
are not a reasonable basis upon which to determine that items or
services provided to different patients sufficiently relate to
treatment of a similar condition. Furthermore, the Departments are of
the view that this level of variation could create complexity for
disputing parties and certified IDR entities and increase the risk of
inconsistent batching determinations.
In addition to batching based on code sets, the Departments
considered specific recommendations from interested parties on creating
additional batching flexibilities for determining whether the items or
services are related to treatment of a similar condition. As discussed
in section II.E.2. of this preamble, anesthesiologists have advocated
for batching by conversion factor since contracting practices for
anesthesiology items and service focus on conversion factor rates. The
Departments are of the view that this approach would undermine the
Departments' efforts to increase efficiency in the Federal IDR process.
Because conversion factors would be identical for every out-of-network
service furnished by an anesthesiologist provider or provider group,
the ``same conversion factor'' requirement results in the provider or
provider group being able to batch every out-of-network service it
furnishes that otherwise satisfies the requirements of the batching
rules at proposed 26 CFR 54.9816-8(c)(4), 29 CFR 2590.716-8(c)(4), and
45 CFR 149.510(c)(4). Instead, the Departments are of the view that
batching based on CPT code categories would lead to greater efficiency,
would more closely align with the interpretation of treatment of a
similar condition, and would lead to less risk in the variability among
the items and services and factual circumstances that certified IDR
entities must consider.
Additionally, the Departments considered feedback provided by
emergency physicians, who stated that the nature of emergency care
makes it difficult for them to batch claims under the current rules and
suggested that the batching rules should allow for the most common
evaluation and management CPT codes (99281-99285) to be batched
together. However, the Departments have concluded that in the context
of emergency care, the acuity of a patient may vary substantially in
these circumstances. This means that certified IDR entities would need
to review complex and disparate factual conditions for each item or
service in a batch pertaining to emergency care, which would be
extremely time consuming. Batching in these circumstances would
therefore exacerbate payment determination delays and compound the
backlog of disputes.
Similarly, the Departments considered allowing batching of all
items and services within one of the six major sections of the CPT code
book: (1) evaluation & management, (2) anesthesiology, (3) surgery, (4)
radiology, (5) pathology and laboratory, and (6) medicine. This could
allow batching of the services most often provided by emergency
physicians, anesthesiologists, radiologists, pathologists, and other
specialty providers. Due to the breadth of CPT
[[Page 75830]]
codes relevant to surgery and radiology services, the Departments
considered further limiting providers' batching ability to the specific
services represented by the code spans relevant to each row in Table 8
that correlates to surgery or radiology services. While these
delineations could serve as straightforward guidelines that may result
in consistent application of a batching standard across certified IDR
entities, the Departments are of the view that variations in these
services within a batched dispute could present challenges to certified
IDR entities' efficient resolution of disputes due again to the fact-
specific and time intensive nature of reviewing information specific to
each item or service within a batch.
[GRAPHIC] [TIFF OMITTED] TP03NO23.012
The Departments are of the view that specific, narrower ranges
within CPT Category I sections could mitigate this risk, more closely
relate to the treatment of a similar condition, and encourage
efficiencies of the Federal IDR process. Further, the Departments are
of the view that batching based on CPT code categories would lead to
greater efficiency, would more closely align with the interpretation of
treatment of a similar condition, and would lead to less risk in the
variability among the items and services and factual circumstances that
certified IDR entities must consider. Thus, in balancing the need to
create a workable batching rule for all parties and encouraging
efficiency (including minimizing costs) to the Federal IDR process, the
Departments determined that it would be appropriate to propose
amendments to allow qualified IDR items and services to be batched by:
(1) items and services furnished to a single patient during a patient
encounter on one or more consecutive dates of service and billed on the
same claim form (single patient encounter); (2) items and services
furnished to one or more patients and billed under the same service
code, or a comparable code under a different procedural code system; or
(3) anesthesiology, radiology, pathology, and laboratory IDR items and
services furnished under service codes belonging to the same Category I
CPT code range, as specified in guidance by the Departments, in order
to address the unique circumstances of certain medical specialties and
provider types.
Because these proposed rules would potentially allow batching of an
unlimited number of qualified IDR items or services, the Departments
also considered different approaches to mitigate the risk of large
batches that may require certified IDR entities to review the
eligibility for each line item, the acuity of each patient and/or other
payment determination factors for each line item in the batch. First,
the Departments considered modifying regulations related to the
certified IDR entity fee to permit certified IDR entities to charge per
line item. However, the Departments are of the view that a per line-
item charge would present cost challenges for providers with lower
dollar-value claims when utilizing the Federal IDR process. The
Departments subsequently considered modifying the IDR entity fee
structure such that the certified IDR entity could charge per unique
service code, so that certified IDR entities would be able to be
adequately compensated for the time and work involved in payment
determinations, while allowing for flexibility to batch a greater
number of line items per dispute. However, given the Departments'
experience in managing the Federal IDR process, the Departments are of
the view that such a modification to the certified IDR entity fee
structure would still necessitate a line-item limit to ensure certified
IDR entities are able to make payment determinations within the
required 30-business-day period. It is the Departments' understanding
that a per service code charge and line-item limit combined may
unnecessarily restrict access to the Federal IDR process.
The Departments also considered limiting a batched dispute to more
than 25 different payment offers. For line items in which the payment
offers are equal, the certified IDR entity could resolve all such line
items through its
[[Page 75831]]
review of a single set of facts and documentation. A few certified IDR
entities noted that it is easier to resolve payment determinations if
the QPA is the same across codes. However, to accommodate batching of
more than 25 qualified IDR items and services with equal payment
offers, the initiating party would need to provide the offer for each
line item or service earlier in the process such as during open
negotiation or in the notice of IDR initiation as opposed to only at
the time of the notice of offer. The Departments are of the view that
this option would prove challenging because it would raise the issue of
how to handle the limit of unique payment offers if the non-initiating
party disagrees with the amount of unique payment offers. Further,
under this approach, if the Departments would require offer information
at the time of IDR initiation, the initiating party would only have 4
days to determine their offer following the end of the open negotiation
period.
Lastly, the Departments considered imposing line-item limits to
mitigate the risk of unwieldy batches. Specifically, the Departments
considered proposing a limit of no more than 50 qualified IDR items or
services in a batched determination. As of June 6, 2023, the average
number of line items per batched dispute was 9 line items from April
2022 to June 2023. The Departments considered that while the average
number of line items per batched dispute is much lower than the 50-
line-item limit, this data is reflective of the number of line items a
party can submit under the same service code, or a comparable code
under a different procedural code system, and that there may likely be
a higher average with the additional proposed batching flexibilities.
Further, the Departments considered that 50 line items might, in some
cases, still allow certified IDR entities to resolve payment
determinations within the required 30-business-day period. However,
based on their experience making payment determinations under the
current batching rule, many certified IDR entities stated that batched
determinations with more than 25 line items would be difficult to
render payment determinations within the 30-business-day period if the
Departments proposed additional batching flexibilities. To ensure
operational efficiency for certified IDR entities as they make their
payment determinations and given the average number of line items in a
batched dispute, the Departments propose to require that no more than
25 qualified IDR items and services may be considered jointly as part
of one payment determination for the purposes of batched
determinations.
8. Administrative and Certified IDR Entity Fee Collection (26 CFR
54.9816-8T(d), 29 CFR 2590.716-8(d), and 45 CFR 149.510(d))
The Departments considered maintaining the current policy that both
the administrative fee and the certified IDR entity fee are due at the
same time, later in the Federal IDR process. The Departments, however,
determined that requiring a uniform 2-business-day requirement for the
administrative fee to be paid by the parties was appropriate. The
Departments are of the view that requiring payment by an initiating
party within 2 business days of the date of preliminary selection of
the certified IDR entity and by a non-initiating party within 2
business days of a notice of an eligibility determination by either the
certified IDR entity or the Departments would substantially accelerate
dispute throughput in the Federal IDR process and ensure that the costs
of using the Federal IDR process are being allocated to both eligible
and ineligible disputes.
Further, the Departments considered requiring the initiating party
to pay the administrative fee within 1 business day of the date of
preliminary selection of the certified IDR entity. The Departments
considered whether the initiating party, by virtue of being the party
that brings the dispute into the Federal IDR process, takes a more
active role from the outset, and it should therefore be aware that it
would be required to pay the administrative fee soon after initiating
the dispute. In contrast, the Departments considered whether it was
appropriate to allow the non-initiating party an additional business
day from the date of notice of an eligibility determination to pay the
administrative fee, because the non-initiating party neither controls
when the dispute is initiated nor when eligibility is determined. On
balance, the Departments determined a uniform 2 business day deadline
from the date the administrative fee amount is determined (which is at
preliminary selection of the certified IDR entity for the initiating
party and at notification of an eligibility determination for the non-
initiating party) was appropriate to allow equitable payment timeframes
for both disputing parties.
Further, the Departments considered requiring the non-initiating
party to pay the administrative fee within 2 business days of
preliminary selection of the certified IDR entity. However, because the
Departments propose in these proposed rules that the non-initiating
party may receive a reduced administrative fee for an ineligible
dispute, the Departments determined requiring payment within 2 business
days of notification of the eligibility determination was more
appropriate. In making this determination, the Departments considered
the additional burden associated with an overcharge to non-initiating
parties for ineligible disputes, including the hold of additional
administrative fees while eligibility is determined and operational
costs to effectuate refunds to overcharged non-initiating parties.
The Departments considered maintaining the status quo of certified
IDR entities collecting the administrative fee on behalf of the
Departments. However, collection of the administrative fee by the
certified IDR entities is inefficient, increases the burden of
uncompensated work to certified IDR entities when the volume of
ineligible disputes is high, and has historically resulted in low
collection rates for ineligible disputes partially due to the existing
administrative fee collection timing. The Departments also considered
direct collection of both the administrative fee and certified IDR
entity fee. The Departments are of the view that direct payment of the
fee by the parties to the organization to which payment is ultimately
owed (the Departments for the administrative fee and the certified IDR
entity for the certified IDR entity fee) is more appropriate,
especially in light of the different timing of these fee collections.
The Departments also considered only pursuing collection actions
from all non-paying parties instead of moving up the timing of the fee
collection. This option was counterbalanced by the expense associated
with collection proceedings and the need to implement a policy that
appropriately accounts for the financial burden of ineligible disputes.
The Departments considered allowing disputes to be placed on a
temporary hold while fees are paid. However, ensuring all appropriate
Federal IDR process fees are paid was counterbalanced by the need to
implement an efficient Federal IDR process to determine out-of-network
rates between providers, facilities, and providers of air ambulance
services and plans, issuers, and FEHB carriers. The Departments are
also of the view that a hold would not incentivize non-responsive
parties to take action to challenge eligibility and further participate
in open negotiation and the Federal IDR process, which are some of the
goals of this proposal.
[[Page 75832]]
The Departments also considered charging only the initiating party
a reduced administrative fee for low-dollar disputes and charging the
non-initiating party the full administrative fee; however, the
Departments determined this may be unnecessarily punitive to non-
initiating parties in low-dollar disputes. Before proposing the highest
offer from a disputing party during open negotiation as the proper
metric to determine whether a dispute is low-dollar, the Departments
considered setting the threshold for low-dollar disputes based on
several metrics including the QPA, billed charge amount, and submitted
offer. The Departments are of the view that the QPA is inappropriate
because interested parties have expressed concerns about relying on the
QPA as a determinative factor in the Federal IDR process. Similarly,
billed charge amount was discarded as an option because it is a
statutorily prohibited factor in payment determinations; thus,
including it as an anchoring point for the administrative fee amount in
the Federal IDR portal may lead disputing parties to believe the billed
charge amount would be improperly considered by the certified IDR
entity in making the final payment determination. Additionally, it
would be inappropriate to utilize the final offer amount for two
reasons. First, the parties may not know their offer amount when the
certified IDR entity is selected and the administrative fee is billed.
Second, utilizing the initiating party's offer amount may result in the
non-initiating party having insight into the final offer of the
initiating party, which may afford a negotiating advantage to non-
initiating parties.
The Departments also considered creating an administrative fee that
would be scaled based on the value of the dispute initiated, such as
charging each disputing party an administrative fee that was 20 percent
of the value of the dispute submitted. The Departments, however, are of
the view that this approach is not appropriate for two reasons. First,
the value of disputes can have a wide range, such as a $5 million
dispute for a NICU inpatient hospital stay compared to a $500
outpatient service. This example structure would result in parties to
the former dispute paying a $1 million administrative fee and parties
to the latter dispute paying a $100 administrative fee. Second, the
Departments recognize that resolving a dispute generally costs the
Departments the same amount regardless of whether the dispute involves
low-dollar or high-dollar items or services, and the Federal IDR
process is intended to streamline resolution of payment disputes
between plans or issuers and providers or facilities. Further, the
nature of estimating the administrative fee based on the expenditures
made by the Departments in a given year means the administrative fee is
not particularized to an individual dispute. This makes a sliding scale
impractical to apply to the wide range of disputes subject to the
Federal IDR process. Finally, the Departments considered maintaining a
flat administrative fee applicable to all disputes but determined that
the impact of a flat administrative fee amount on parties seeking to
initiate low-dollar disputes could make the Federal IDR process cost
prohibitive for some initiating parties.
The Departments considered applying a standardized administrative
fee to all parties in all disputes regardless of eligibility. After
considering a uniform application, the Departments determined that a
framework that better accounts for eligibility costs based on the role
of the disputing party and the eligibility of the dispute was a more
appropriate distribution of the Departments' expenditures which the
administrative fee is designed to recoup. The Departments also had
concerns that non-initiating parties could be penalized by paying for
an ineligible dispute if an initiating party indiscriminately submitted
disputes; however, given that an initiating party must pay the
administrative fee for a dispute to be considered fully submitted and
for the fee to be assessed to both parties, the Departments are of the
view that there are sufficient safeguards in place. Further, the
Departments also considered not charging non-initiating parties for
ineligible disputes; however, because the statute indicates that each
party to a dispute is responsible for the administrative fee, and even
in ineligible disputes the non-initiating party is benefiting from
Federal IDR process safeguards such as access to the proposed registry
and open negotiation, the Departments are of the view that a payment of
a reduced administrative fee for non-initiating parties is appropriate,
even in disputes that are not eligible for the Federal IDR process. The
Departments recognize that the timelines described in this proposed
policy may place additional burden on resource constrained small
entities. However, the Departments believe that any additional burden
to small entities will be significantly outweighed by the additional
benefits to small entities from the proposed policies regarding low
dollar and ineligible disputes.
9. Extension of Time Periods for Extenuating Circumstances (26 CFR
54.9816-8(g), 29 CFR 2590.716-8(g), and 45 CFR 149.510(g))
Under the proposed amendments to 26 CFR 54.9816-8(g), 29 CFR
2590.716-8(g), and 45 CFR 149.510(g), the Departments would provide an
extension of the time periods associated with the Federal IDR process
if they identify unforeseen or good cause delays on a case-by-case
basis, as opposed to solely relying on one of the parties to submit an
extension request. Further, the Departments also propose to codify a
generally applicable extension of time periods when the Departments
determine that such extension is necessary due to extenuating
circumstances that contribute to systematic delays in processing
disputes under the Federal IDR process, such as an unforeseen high
volume of disputes or Federal IDR portal system failures.
The Departments considered alternatives to these proposals,
including maintaining the status quo and not proposing to modify the
ability of the Departments to provide extensions on a case-by-case
basis or for generally applicable extensions of time periods.
Additionally, the Departments considered only proposing the former, and
not proposing to codify generally applicable extensions. However, the
Departments are of the view that both proposed pathways to granting
extensions of time periods for extenuating circumstances are relevant
and necessary for the parties and entities participating in the Federal
IDR process. In particular, the Departments are of the view that the
ability to grant generally applicable extensions of time periods due to
extenuating circumstances that contribute to systematic delays would
provide protection for parties engaged in the Federal IDR process from
the impact of systematic processing delays and ensure that unforeseen
circumstances do not unfairly disadvantage a party or hinder its
ability to comply with the Federal IDR process timeframes. Furthermore,
the Departments believe that these additional protections may be
especially beneficial to small entities, which may face difficulty in
complying with the timelines proposed in this rulemaking. This proposed
policy may partially offset the additional timeframe compliance burden
placed on small entities, as described throughout this section, by
providing greater flexibility in obtaining extensions in extenuating
circumstances.
[[Page 75833]]
10. Registration of Group Health Plans and Health Insurance Issuers (26
CFR 54.9816-9, 29 CFR 2590.716-9, and 45 CFR 149.530)
These proposed rules would require plans and issuers to submit
certain information to the Departments within 30 business days after
the effective date of the final rules through an IDR registration
process, and would make the resulting registry of plans and issuers
available to parties initiating open negotiation requests or disputes
through the Federal IDR portal. The Departments also recognize that
this proposed policy may impose additional burden on resource
constrained small entities by requiring them to submit additional
information to the Departments. The Departments considered limiting
registration information to a plan's or issuer's contact information
and plan type (for example, fully-insured, self-insured, etc.).
However, the Departments are of the view that this limited set of
information would be insufficient to allow providers, facilities, and
providers of air ambulances to initiate open negotiation and disputes
correctly. For example, if a plan submitted information that it was
self-insured but did not submit information showing that it had opted
into a specified State law, a provider might incorrectly initiate a
payment dispute in the Federal IDR process rather than the relevant
State process. The Departments also considered requiring more
comprehensive registration information, including a list of items and
services that the plan covers which would be subject to a specified
State law or All-Payer Model Agreement. The Departments are of the view
that this level of detail would be overly burdensome on plans and
issuers. Additionally, since States regularly modify the requirements
of their specified State laws and All-Payer Model Agreements, the
information contained in the registry would frequently be out-of-date.
The Departments also considered allowing plans and issuers a period of
one year following the rules' effective date to register; however, the
Departments are of the view that since plans and issuers are already
required to disclose most of the proposed registration information,
requiring registration by 30 business days after the rules' effective
date would not be unduly burdensome.
F. Paperwork Reduction Act--Department of Health and Human Services,
Department of Labor, and Department of the Treasury
Under the Paperwork Reduction Act of 1995 (PRA), the Departments
are required to provide 60-day notice in the Federal Register and
solicit public comment before a collection of information requirement
is submitted to OMB for review and approval. To fairly evaluate whether
an information collection should be approved by OMB, section
3506(c)(2)(A) of the PRA requires that the Departments solicit comment
on the following issues:
The need for information collection and its usefulness in
carrying out the proper functions of the Departments.
The accuracy of the Departments' estimate of the
information collection burden.
The quality, utility, and clarity of the information to be
collected.
Recommendations to minimize the information collection
burden on the affected public, including automated collection
techniques.
1. Wage Estimates
To derive wage estimates, the Departments generally used data from
the Bureau of Labor Statistics to derive average labor costs (including
a 100 percent increase for fringe benefits and overhead) for estimating
the burden associated with the information collection requirements
(ICRs).\209\ Table 9 presents the mean hourly wage, the cost of fringe
benefits and overhead, and the adjusted hourly wage from the May 2022
National Occupational Employment and Wage Estimates (https://www.bls.gov/oes/current/oes_nat.htm).
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\209\ Id.
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As indicated, employee hourly wage estimates have been adjusted by
a factor of 100 percent. This is necessarily a rough adjustment, both
because fringe benefits and overhead costs vary significantly across
employers and because methods of estimating these costs vary widely
across studies.
[GRAPHIC] [TIFF OMITTED] TP03NO23.013
2. ICRs Regarding Information To Be Shared About the QPA (26 CFR
54.9816-6(d), 29 CFR 2590.716-6(d), and 45 CFR 149.140(d))
The July 2021 interim final rules, as updated by the August 2022
final rules, require plans and issuers to provide certain information
regarding the QPA to providers, facilities, and providers of air
ambulance services when making an initial payment or notice of denial
of payment when the QPA is the recognized amount (or, for air ambulance
services, the amount on which cost sharing is based).
These proposed rules would require plans and issuers to disclose
the legal business name of the group health plan (if any) or issuer;
the legal business name of the plan sponsor (if applicable); and the
assigned Federal IDR registration number (if the plan or issuer is
registered with the Federal IDR
[[Page 75834]]
registry). In addition, these proposed rules would amend the statement
required under 26 CFR 54.9816-6(d)(1)(iv), 29 CFR 2590.716-6(d)(1)(iv),
and 45 CFR 149.140(d)(1)(iv) to make technical and conforming changes
to the content of the statement.
The Departments assume that TPAs would provide this information on
behalf of the self-insured plans they administer. The Departments
assume that issuers and TPAs would automate the process of preparing
and providing this information to providers, facilities, and providers
of air ambulance services. The Departments anticipate that issuers and
TPAs would need to make a one-time change to their IT systems to make
changes to the currently required QPA notification to incorporate the
proposed information described in the proposed new paragraph (d)(1)(v)
and paragraph (d)(1)(iv). The Departments estimate that for each plan
and issuer, on average, it would take a computer programmer 3 hours (at
an hourly rate of $98.84) to add fillable fields to disclose the legal
business name (if any) of the group health plan or issuer; the legal
business name of the plan sponsor (if applicable) and the assigned
Federal IDR registration number (if the plan or issuer is registered
with the Federal IDR registry); to add information notifying the
provider, facility, or provider of air ambulance services of the
proposed requirement to notify the Departments to initiate open
negotiation; and to replace the phrase ``amount of total payment'' with
the term ``out-of-network rate'' and the term ``determination'' with
the phrase ``agreement on the amount of payment'' in the statement
about initiating open negotiation. The Departments estimate that the
one-time burden for each plan or issuer, to be incurred in 2024, would
be 3 hours on average, with an equivalent cost of approximately $297.
The Departments estimate a total one-time burden, for all issuers and
TPAs, of 5,115 hours, with an associated cost of approximately
$505,567. As the Departments share jurisdiction, HHS would account for
50 percent of the total burden, or approximately 2,558 burden hours,
with an equivalent cost of approximately $252,783. The Departments of
Labor and the Treasury would each account for 25 percent of the total
burden, or approximately 1,279 burden hours, with an equivalent cost of
approximately $126,392. The Departments seek comment on these burden
estimates.
In addition, the Departments propose to revise the regulation
addressing information to be shared about the QPA to make clear these
disclosures are required when the recognized amount (or for air
ambulance services, the amount on which cost sharing is based) is the
QPA or the amount billed by the provider, facility, or provider of air
ambulance services. The Departments anticipate that this is not a
common occurrence and therefore would not result in an increase in
burden for plans and issuers.
[GRAPHIC] [TIFF OMITTED] TP03NO23.014
The Departments would revise the information collection currently
approved under OMB control number 0938-1401 to account for this new
burden.\210\
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\210\ OMB Control Number: 0938-1401 (CMS-10780, Requirements
Related to Surprise Billing: Qualifying Payment Amount, Notice and
Consent, Disclosure on Patient Protections Against Balance Billing,
and State Law Opt-in).
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3. ICRs Regarding Open Negotiation (26 CFR 54.9816-8(b)(1), 29 CFR
2590.716-8(b)(1), and 45 CFR 149.510(b)(1))
The Departments propose to require a party to provide an open
negotiation notice containing additional required elements and
supporting documentation to the other party and the Departments to
initiate the open negotiation period. The October 2021 interim final
rules established that the initiating party must provide an open
negotiation notice to the other party which must include information
sufficient to identify the items or services subject to negotiation,
including the date(s) the item(s) or service(s) were furnished, the
service code, and initial payment amount, if applicable), an offer of
an out-of-network rate, and contact information for the party sending
the open negotiation notice. The provisions in these proposed rules
would expand the required information in an open negotiation notice to
include 12 new content additions to the existing required elements. The
expanded content requirements would include: (1) information sufficient
to identify the provider, facility or provider of air ambulance
services, including name and current contact information (including the
legal business name, email address, phone number, and mailing address)
and the National Provider Identifier (NPI); (2) the plan's or issuer's
registration number as required under 26 CFR 54.9816-9, 29 CFR
2590.716-9, and 45 CFR 149.530 (if the plan or issuer is not registered
under 26 CFR 54.9816-9, 29 CFR 2590.716-9, and 45 CFR 149.530, an
attestation by the party submitting the open negotiation notice that
the plan or issuer was not registered by the date it submitted the open
negotiation notice), the legal business name of the plan or issuer as
well as the current contact information (name, email address, phone
number, and mailing address) of the plan or issuer as provided with the
initial payment or notice of denial of payment, and if the party
submitting the open negotiation notice is a plan or issuer, the plan
type (for example, self-insured or fully-insured); (3) the name
[[Page 75835]]
and contact information including the legal business name, email
address, phone number, and mailing address for any third party
representing the party submitting the open negotiation notice and an
attestation that the third party has the authority to act on behalf of
the party it represents in the open negotiation; (4) information
sufficient to identify the item or service, including, but not limited
to: the date(s) the item or service was furnished and the date(s) that
the provider, facility, or provider of air ambulance services received
the initial payment or notice of denial of payment for such item or
service from the plan or issuer; the type of item or service including,
whether the item or service is an emergency service as defined in 26
CFR 54.9816-4T(c)(2), 29 CFR 2590.716-4(c)(2), and 45 CFR
149.110(c)(2), non-emergency times and services as described in 26 CFR
54.9816-5T(b), 29 CFR 2590.716-5(b), and 45 CFR 149.120(b); or an air
ambulance service as defined in 26 CFR 54.9816-3T, 29 CFR 2590.716-3,
and 45 CFR 149.30; whether the service is a professional service or
facility-based service; the State where the item or service was
furnished; the claim number; the service code; and information
sufficient to identify the location the item of service was furnished
(such as place of service code or bill type); (5) the initial payment
amount (including $0 if, for example, payment is denied); (6) the QPA
if provided with the initial payment or denial of payment; (7) an offer
of an out-of-network rate for each item or service; (8) if the party
submitting the open negotiation notice is a plan or issuer, the amount
of cost sharing imposed for the item or service; (9) if the party
submitting the open negotiation notice is a provider or facility, a
statement that the patient who received the item or service did not
receive notice or provide consent as described in 45 CFR 149.410(b) or
149.420(c) through (i) to be treated by a nonparticipating provider or
nonparticipating emergency facility; (10) a statement that the
provider, facility, or provider of air ambulance services was a
nonparticipating provider, nonparticipating emergency facility, or
nonparticipating provider of air ambulance services on the date the
item or service was furnished; (11) general information listed in the
standard open negotiation notice developed by the Departments
describing the open negotiation period and the Federal IDR process
(including a description of the purpose of the open negotiation period
and Federal IDR process and key deadlines in the open negotiation
period and Federal IDR process); and (12) a copy of the initial payment
or notice of denial of payment or other remittance advice that is
required to include the disclosures under 26 CFR 54.9816-6T(d)(1), 29
CFR 2590.716-6(d)(1), and 45 CFR 149.140(d)(1) for the item or service.
Furthermore, the Departments propose that the party in receipt of
the open negotiation notice would be required to provide a response to
the open negotiation notice through the Federal IDR portal no later
than the 15th business day of the 30-business-day open negotiation
period. The proposed open negotiation response notice would require the
following categories of information, beginning with the same
information as specified in proposed 26 CFR 54.9816-8(b)(1)(ii)(A)(1)
through (3), 29 CFR 2590.716-8(b)(1)(ii)(A)(1) through (3), and 45 CFR
45 CFR 149.510(b)(1)(ii)(A)(1) through (3) related to the requirements
to provide contact information for the provider, facility, or provider
of air ambulance services, and the plan or issuer that is a party to
the open negotiation, and any third party representing a party in the
open negotiation. It would also include (4) information sufficient to
identify each item or service included in the open negotiation notice,
including the date(s) the item or service was furnished and the date(s)
that the provider, facility, or provider of air ambulance services
received the initial payment or notice of denial of payment for such
item or service from the plan or issuer and the claim number; (5) if
the party in receipt of the open negotiation notice is a plan or
issuer, a statement as to whether the party in receipt of the open
negotiation notice agrees that the initial payment amount (including $0
if, for example, payment is denied) and the QPA reflected in the open
negotiation notice is accurate for the item or service, and if not, or
if the open negotiation notice indicated that the initial payment
amount or qualifying payment amount was not communicated by the plan or
issuer with the initial payment or notice of denial of payment or other
remittance advice, the initial payment amount (including $0 if, for
example, payment is denied) and/or QPA amount it believes to be correct
and documentation to support the statement; (6) if the party in receipt
of the open negotiation notice is a plan or issuer, the amount of cost
sharing imposed for the item or service; (7) a counteroffer of an out-
of-network rate for the item or service or an acceptance of the other
party's offer; (8) if the party in receipt of the open negotiation
notice is a provider or facility, a statement that the patient who
received the item or service did not receive notice or provide consent
to be treated by a nonparticipating provider or nonparticipating
emergency facility as described in 149.410(b) or 149.420(c) through
(i); (9) with respect to each item or service, either a statement and
supporting documentation that notes why the item or service is
ineligible for the Federal IDR process or a statement agreeing that the
item or service is eligible for the Federal IDR process; (10) a
statement as to whether any of the information provided in the open
negotiation notice is inaccurate and the basis for the assertion; and
(11) a statement confirming that the initial payment or notice of
denial of payment or other remittance advice provided with the open
negotiation notice is accurate, and if inaccurate, a copy of the
initial payment or notice of denial of payment or other remittance
advice that are required to include the disclosures under 26 CFR
54.9816-6T(d)(1), 29 CFR 2590.716-6(d)(1), and 45 CFR 149.140(d)(1),
for the item or service.
In addition to the paperwork costs for the Federal IDR process
previously accounted for in the July 2021 interim final rules and
October 2021 interim final rules, the Departments estimate that it
would take a compensation and benefits manager 30 minutes (at an hourly
rate of $137.64) and an office clerk 15 minutes (at an hourly rate of
$39.56) on average to prepare and submit the additional information for
open negotiation for each plan, issuer, or FEHB carrier and provider or
facility initiating open negotiation. This results in a cost of $78.71
per party per open negotiation notice. Similarly, the Departments
estimate that it would take a compensation and benefits manager 30
minutes (at an hourly rate or $137.64) and an office clerk 15 minutes
(at an hourly rate of $39.56) on average to prepare and submit the
proposed open negotiation response notice for each party in receipt of
the open negotiation notice, resulting in a cost of $78.71 per party
per open negotiation response notice. In the October 2021 interim final
rules, the Departments originally estimated that 25 percent of disputes
would be resolved in open negotiation before entering the Federal IDR
process.\211\ The Departments request data or comments on whether this
assumption has been proven correct. Accordingly, the Departments
estimate that 560,000 disputes per year would go through open
negotiation, requiring
[[Page 75836]]
560,000 initiating parties to prepare and submit the additional
materials proposed for the open negotiation notice and 560,000 non-
initiating parties to prepare and submit the additional materials
proposed for the open negotiation notice response notice. At a cost of
$78.71 ($68.82 for 30 minutes by the compensation and benefits manager
and $9.89 for 15 minutes by the office clerk, or a combined hourly rate
of $104.95) per party per dispute, this results in a total annual hour
burden of 840,000 hours with an equivalent cost of approximately
$88,158,000 for 560,000 disputes annually beginning in 2025.\212\ As
the Departments and OPM share jurisdiction, HHS would account for 45
percent of the total burden, or approximately 378,000 burden hours,
with an equivalent cost of approximately $39,671,100. The Departments
of Labor and the Treasury would each account for 25 percent of the
total burden, or approximately 210,000 burden hours, with an equivalent
cost of approximately $22,039,500. OPM would account for 5 percent of
the total burden, or approximately 42,000 burden hours, with an
equivalent cost of approximately $4,407,900. The Departments seek
comment on these assumptions.
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\211\ 86 FR 56056.
\212\ As the Departments do not anticipate these proposed rules
would be finalized and effective before July 1, 2024, the burden for
2024 would be prorated to 50 percent, or 420,000 hours with an
equivalent cost of $44,079,000.
[GRAPHIC] [TIFF OMITTED] TP03NO23.015
The Departments would revise the information collection currently
approved under OMB control number 1210-0169 to account for this new
burden.\213\
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\213\ OMB Control Number: 1210-0169 (No Surprises Act: IDR
Process).
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4. ICRs Regarding Initiating the Federal IDR Process and the Notice of
IDR Initiation (26 CFR 54.9816-8(b)(2), 29 CFR 2590.716-8(b)(2), and 45
CFR 149.510(b)(2))
a. Notice of IDR Initiation and Notice of IDR Initiation Response
To initiate the Federal IDR process, the initiating party must
submit a written notice of IDR initiation to the non-initiating party
and to the Departments (using the standard form developed by the
Departments) during the 4-business-day period beginning on the first
business day after the close of the 30-business-day open negotiation
period. The Departments propose to add additional required elements
under the 8 categories to the existing required information in the
written notice of IDR initiation: (1) information sufficient to
identify the initiating party, including the TIN, the NPI of the
provider, facility, or provider of air ambulance services (if
available), the plan's or issuer's registration number, if the plan or
issuer is registered under 26 CFR 54.9816-9, 29 CFR 2590.716-9, and 45
CFR 149.530, and if the initiating party is a plan or issuer, the plan
type; (2) the name and contact information for any third party
representing the initiating party and an attestation that the third
party has the authority to act on behalf of the party it represents in
the Federal IDR process; (3) information sufficient to identify whether
the dispute being initiated includes batched or bundled qualified IDR
items or services; (4) information sufficient to identify the item or
service included in the notice of IDR initiation, including the date(s)
the item or service was furnished. If the initiating party is a
provider, facility, or provider of air ambulances, the date(s) the
provider, facility, or air ambulance provider received the initial
payment or denial of payment, the date the open negotiation period
began, the type of item or service, whether the service is a
professional or service or facility-based service, the State where the
item or service was furnished, the claim number, service code and
information to identify the location the service was furnished
(including place of service or bill type code); (5) if the non-
initiating party is a plan or issuer, a statement that the provider,
facility, or air ambulance provider was a nonparticipating provider,
facility, or air ambulance provider; (6) an attestation that the item
or service is a qualified IDR item or service and the basis for the
attestation; (7) a copy of the initial payment or notice of denial of
payment or other remittance advice that is required to include the
disclosures under 26 CFR 54.9816-6T(d)(1), 29 CFR 2590.716-6(d)(1), and
45 CFR 149.140(d)(1), with respect to the item or service; and (8) a
statement describing the key aspects of the claim, such as patient
acuity or level of training of the provider, facility, or provider of
air ambulance services that furnished the qualified IDR item or
service, discussed by the parties during open negotiation that relate
to the payment for the disputed claim, whether the reasons for
initiating the Federal IDR process are different from the aspects of
the claim discussed during the open negotiation period, and an
explanation of why the party is initiating the Federal IDR process.
The Departments also propose that the non-initiating party must
submit a written response to the notice of IDR initiation to the
initiating party and to the Departments during the 3-business-day
period beginning on the day after the notice of IDR initiation is
received by the Departments. This proposed IDR initiation response
notice would require the following information: (1) information
sufficient to identify the provider, facility, or provider of air
ambulance services, including name and current contact information
(including the legal business name, email address, phone number, and
mailing address), the TIN, the NPI of the
[[Page 75837]]
provider, facility, or provider of air ambulance services, (2)
information sufficient to identify the plan or issuer including the
plan's or issuer's registration number, as required under 26 CFR
54.9816-9, 29 CFR 2590.716-9, and 45 CFR 149.530 or an attestation from
the non-initiating party that the plan or issuer was not registered
prior to the date that it submitted the notice, the legal business name
of the plan or issuer, as well as the current contact information
(name, email address, phone number, and mailing address) of the plan or
issuer as provided with the initial payment or notice of denial of
payment; and if the party submitting the notice of IDR initiation
response is a plan or issuer, the plan type (for example, self-insured
or fully-insured) and TIN (or, in the case of a plan that does not have
a TIN, the TIN of the plan sponsor); (3) the name and contact
information for any third party representing the non-initiating party
and an attestation that the third party has the authority to act on
behalf of the party it represents in the Federal IDR process; (4)
information sufficient to identify each item or service (including the
date(s) the item or service was furnished, if the non-initiating party
is a provider, facility, or provider of air ambulance services, the
date(s) that the provider, facility, or provider of air ambulance
services received the initial payment or notice of denial of payment
for such item or service from the plan or issuer, and the claim
number); (5) if the non-initiating party is a plan or issuer, a
statement as to whether the non-initiating party agrees that the
initial payment (including $0 if, for example, payment is denied) and
the QPA reflected in the notice of IDR initiation is accurate and if
not, an assertion of the correct initial payment amount and/or the QPA
that was disclosed with the initial payment or notice of denial of
payment for the item or service and documentation to support the
assertion; (6) if the non-initiating party is a plan or issuer, the
amount of cost sharing imposed for the item or service; (7) if the non-
initiating party is a provider or facility, a statement that the items
and services do not qualify for the notice and consent exception
described at CFR 149.410(b) or 149.420(c); (8) for each item or service
subject to the dispute, an attestation that the item or service that is
the subject of the dispute is a qualified IDR item or service, and for
each item or service that the non-initiating party attests is not a
qualified IDR item or service, an explanation and supporting
documentation; (9) a statement confirming that the initial payment or
notice of denial of payment or other remittance advice provided by the
initiating party under paragraph (b)(2)(ii)(A)(12) is accurate, and if
inaccurate, a copy of the remittance advice or other documentation
required to include the disclosures under 26 CFR 54.9816-6T(d)(1), 29
CFR 2590.716-6(d)(1), and 45 CFR 149.140(d)(1), with respect to the
item or service; (10) a statement as to whether any of the information
provided in the notice of IDR initiation is inaccurate and the basis
for the statement as well as any supporting documentation; and (11) a
statement as to whether the non-initiating party agrees or objects to
the initiating party's preferred certified IDR entity and if the party
objects, an alternative preferred certified IDR entity.
In addition to the paperwork costs for the Federal IDR process, the
Departments estimate that it would take a compensation and benefits
manager 30 minutes (at an hourly rate of $137.64) and an office clerk
15 minutes (at an hourly rate of $39.56) on average to prepare and
submit the additional statements proposed for the notice of IDR
initiation for each initiating party, resulting in a cost of $78.71 per
party per notice of IDR initiation. Similarly, the Departments estimate
that it would take a compensation and benefits manager 30 minutes (at
an hourly rate of $137.64) and an office clerk 15 minutes (at an hourly
rate of $39.56) on average to prepare and submit the proposed notice of
IDR initiation response for each non-initiating party, resulting in a
cost of $78.71 per party per notice of IDR initiation response. The
Departments estimate that 420,000 disputes would be initiated,
requiring work by 840,000 disputing parties. At a per party cost of
$78.71 ($68.82 for 30 minutes by the compensation and benefits manager
at $137.64 per hour and $9.89 for 15 minutes by the office clerk at
$39.56 per hour, or a combined hourly rate of $104.95) per party, this
results in a total estimated annual hour burden of 630,000 hours or an
equivalent cost burden of $66,118,500 for 420,000 disputes, which
includes 315,000 estimated annual burden hours or an equivalent annual
cost burden of $33,059,250 each for initiating and non-initiating
parties, respectively, beginning in 2025.\214\ As the Departments and
OPM share jurisdictions, HHS would account for 45 percent of the total
burden, or approximately 283,500 burden hours, with an equivalent cost
of approximately $29,753,325. The Departments of Labor and the Treasury
would each account for 25 percent of the total burden, or approximately
157,500 burden hours, with an equivalent cost of approximately
$16,529,625. OPM would account for 5 percent of the total burden, or
approximately 31,500 burden hours, with an equivalent cost of
approximately $3,305,925. The Departments seek comment on these
assumptions.
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\214\ As the Departments do not anticipate these proposed rules
would be finalized and effective before July 1, 2024, the burden for
2024 would be prorated to 50 percent, or 315,000 hours with an
equivalent cost of $33,059,250.
[GRAPHIC] [TIFF OMITTED] TP03NO23.016
[[Page 75838]]
The Departments would revise the information collection currently
approved under OMB control number 1210-0169 to account for the new
burden.\215\
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\215\ OMB Control Number: 1210-0169 (No Surprises Act: IDR
Process).
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b. Preliminary Selection of the Certified IDR Entity
The Departments anticipate that the amendments to the process for
the preliminary selection of the certified IDR entity would reduce the
overall burden associated with collecting information through the
notice of certified IDR entity selection. In these proposed rules, the
Departments propose that the non-initiating party must agree or object
to the preferred certified IDR entity in the notice of IDR initiation
response. Accordingly, the initiating party would only be required to
submit the notice of certified IDR entity selection if the non-
initiating party objects to the initiating party's preferred certified
IDR entity and submits an alternative preferred certified IDR entity in
the notice of IDR initiation response, thus limiting the frequency with
which the Departments expect the initiating party to submit this
information. Similarly, the non-initiating party would only be required
to use the notice of certified IDR entity selection if the non-
initiating party objected to the initiating party's alternative
preferred certified IDR entity included in the initiating party's
notice of certified IDR selection form. The content submitted through
the notice would also be streamlined to only reflect information
confirming the party's agreement or objection, preferred alternative to
other party's alternative preferred certified IDR entity, and if
applicable, an explanation of the conflict of interest with the
alternative preferred certified IDR entity.
Under the current rules and currently approved PRA package (OMB
control number 1210-0169), the Departments assume that all disputes
require the submission of the notice of certified IDR entity selection,
and that each notice corresponds to approximately 1.25 burden hours,
with an equivalent cost of $119.\216\ Across all disputes, the
Departments assume an annual burden of approximately 21,794 hours at a
cost of approximately $2,156,635 for parties to submit the notice of
certified IDR entity selection. However, based on these proposed rules,
the Departments anticipate that the frequency and content of this
collection would change, thus impacting the currently estimated burden.
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\216\ The Departments assume that it will take 1 hour for a
medical and health services professional to write the notice and 15
minutes for a clerical worker to prepare and send the notice at a
wage rate of $109.03 per hour for the medical and health services
manager and a wage rate of $58.66 per hour for the clerical worker.
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Under these proposed rules, this information collection would be
limited to those disputes in which either party does not agree to the
other party's preferred alternative certified IDR entity. For this
subset of disputes, the initiating party would be required to submit
the notice of certified IDR entity selection to indicate agreement or
objection to the non-initiating party's alternate preferred certified
IDR entity selection as indicated in the notice of IDR initiation
response, and both parties would have the ability to submit the notice
back-and-forth during the 3-day period after the date of IDR initiation
until an agreed upon entity is identified or the parties fail to
jointly agree. The content of the collection would be revised to only
require a party to indicate their agreement or objection and if
applicable an explanation of the conflict of interest, and
identification of an alternate preferred certified IDR entity and thus
the Departments anticipate that it would take a respondent much less
time to submit this information than previously estimated.
Based on internal data, in approximately 29 percent of disputes,
the non-initiating party objects to the certified IDR entity selected
by the initiating party. Further, out of the 29 percent of disputes in
which the non-initiating party objected to the certified IDR entity
selected by the initiating party, the majority of those disputes (93
percent, or 27 percent of all disputes) the initiating party agreed to
the alternate preferred certified IDR entity selected by the non-
initiating party. In a very small percentage (approximately 2 percent)
of disputes, the non-initiating party and initiating party engage in a
back-and-forth by objecting to each other's preferred certified IDR
entities multiple times. Based on the number of disputes submitted from
June 2022 through June 2023, the Departments estimate that
approximately 113,400 disputes would require the initiating party to
submit a notice of certified IDR entity selection form a single time.
The Departments estimate that it would take an office clerk 30 minutes
(at an hourly rate of $39.56) on average to prepare and submit the
notice indicating agreement or objection to the alternate preferred
certified IDR entity and selecting an alternative entity, if
applicable. This would result in a cost of $19.78 per dispute. For the
approximately 113,400 disputes that would require this collection, the
total annual hourly burden would be 56,700 hours, with an equivalent
annual cost of approximately $2,243,052.\217\
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\217\ The is calculated as follows: 113,400 disputes x 0.5 hours
= 56,700 burden hours. 56,700 burden hours x $39.56 hourly rate =
$2,243,052 total annual cost.
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In addition, the Departments expect that, for a small proportion of
disputes, the initiating party and the non-initiating party would
exchange the notice of certified IDR entity selection multiple times
within the proposed timeframe before reaching agreement and jointly
selecting or defaulting to random selection. To reflect the additional
burden associated with disputes requiring multiple notices, the
Departments estimate that approximately 8,400 disputes would require
the provision of two total rounds of notice exchange \218\ by the
initiating party and non-initiating party before either jointly
selecting a certified IDR entity or defaulting to selection by the
Departments. This would result in a cost of $39.56 per dispute, and a
total annual hourly burden of 8,400 hours with an equivalent cost of
$332,304.\219\
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\218\ Internal data show that the highest number of times a
certified IDR entity was selected for a single dispute was five.
Since these proposed rules would amend the frequency of use of the
notice of certified IDR entity selection by transferring one of the
selection instances to the notice of IDR initiation, five unique
selections would correspond to four exchanges of the notice of
certified IDR entity selection. However, the Departments anticipate
that four exchanges would be quite rare based on internal data, so
the Departments are using two exchanges of the notice of certified
IDR entity selection in these estimates. The Departments seek
comment on these assumptions.
\219\ This is calculated as follows: 8,400 disputes x 0.5 hours
x 2 exchanges = 8,400 burden hours. 8,400 burden hours x $39.56
hourly rate = $332,304 total annual cost.
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The Departments estimate that in total for disputes requiring this
collection, including both the 113,400 disputes that the Departments
anticipate would require a single submission of the notice of certified
IDR entity selection form and the 8,400 disputes requiring multiple
submissions of the form, the average burden per response would be
approximately 0.53 hours \220\ with an equivalent cost of approximately
$21.14 per response.\221\ Therefore, the total annual burden would be
65,100 hours, with an equivalent cost of
[[Page 75839]]
$2,575,356.\222\ As the Departments and OPM share jurisdiction, HHS
would account for 45 percent of the total burden, or approximately
29,295 burden hours, with an equivalent cost of approximately
$1,158,910. The Departments of Labor and the Treasury would each
account for 25 percent of the total burden, or approximately 16,275
burden hours each, with an equivalent cost of approximately $643,839
each. OPM would account for 5 percent of the total burden, or
approximately 3,255 burden hours, with an equivalent cost of
approximately $128,768.
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\220\ The precise unrounded number for the weighted average time
per response is 0.53448 hours. This unrounded number is used to
calculate the total annual burden across the disputes requiring the
submission of a certified IDR entity selection notice. The
calculation is as follows: 0.53448 weighted average time per
response x 121,800 disputes = 65,100 total annual burden hours.
\221\ This is calculated as follows: 0.53 hours x $39.56 hourly
rate = $21.14 cost per response.
\222\ As the Departments do not anticipate these proposed rules
would be finalized and effective before July 1, 2024, the burden for
2024 would be prorated to 50 percent, or 32,550 hours with an
equivalent cost of $1,287,678.
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However, as discussed earlier in this section, as the current
information collection assumes a burden per respondent of 1.25 hours
and a total cost burden of $2,156,635, the Departments estimate a total
increase in costs of approximately $418,621 \223\ due to the proposed
changes to the requirement to submit this notice. The Departments seek
comment on these assumptions.
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\223\ This is calculated as follows: $2,156,635 - $2,575,256 = -
$418,621.
[GRAPHIC] [TIFF OMITTED] TP03NO23.017
The Departments would revise the information collection currently
approved under OMB control number 1210-0169 to account for this revised
burden.
5. ICRs Regarding Federal IDR Eligibility Determinations (26 CFR
54.9816-8(c), 29 CFR 2590.716-8(c), and 45 CFR 149.510(c))
The Departments anticipate no change or nominal change in burden
related to the proposed departmental eligibility review provision. This
information collection is approved under OMB control number 1210-0169.
The same type and quantity of information would continue to be
collected from disputing parties to determine eligibility under these
proposed rules. When the departmental eligibility review is in effect,
the Departments would be collecting information related to Federal IDR
dispute eligibility. When the departmental eligibility review is not in
effect, the Departments and the certified IDR entities would be
collecting this information. Therefore, the Departments are of the view
that there is no change in burden associated with changing to whom the
parties are submitting eligibility information. The Departments seek
comment on these assumptions.
6. ICRs Regarding Withdrawals (26 CFR 54.9816-8(c)(3)(ii), 29 CFR
2590.716-8(c)(3)(ii), and 45 CFR 149.510(c)(3)(ii))
The Departments propose to add 26 CFR 54.9816-8(c)(3)(ii), 29 CFR
2590.716-8(c)(3)(ii), and 45 CFR 149.510(c)(3)(ii) to establish a
process for disputes to be withdrawn from the Federal IDR process. The
proposed withdrawal process would require the creation of a new
collection of information and increase burden on the initiating and
non-initiating parties required to submit the proposed notice. These
proposed rules would require the initiating party to submit a
withdrawal request to the Departments and the non-initiating party
through the Federal IDR portal. The non-initiating party would then be
required to provide a response within 5 business days indicating
agreement or objection to the request for withdrawal. Each dispute
would therefore require a collection from both the initiating
(requesting) and the non-initiating (responding) parties in order to
withdraw. If the non-initiating party fails to respond, the non-
initiating party would be considered to have agreed to the dispute's
withdrawal. The Departments expect that dispute withdrawals would be
relatively rare: Based on internal data, the Departments anticipate
that approximately 4 percent of disputes (or 16,800 disputes) would be
withdrawn annually.
The Departments estimate that it would take a compensation and
benefits manager 15 minutes (at an hourly rate of $137.64) and an
office clerk 15 minutes (at an hourly rate of $39.56) for the
initiating party to prepare and submit the notice of request for
withdrawal to the non-initiating party and the Departments through the
Federal IDR portal, resulting in a time of 30 minutes and cost of
$44.30 per dispute for the initiating party.\224\ For the anticipated
16,800 withdrawn disputes annually, initiating parties would incur a
total of 8,400 burden hours with an equivalent cost burden of $744,240
to submit withdrawal requests annually.\225\ Because the notice of
withdrawal response would have fewer data elements and would require a
lower amount of time and labor burden to submit, the Departments
estimate that it would take an office clerk approximately 15 minutes
(at an hourly rate of $39.56) on average for the non-initiating party
to submit the notice of withdrawal response to the initiating party and
the Departments through the Federal IDR portal, resulting in a cost of
$9.89 per response.\226\ For the anticipated 16,800 withdrawn disputes
annually, the non-initiating party would
[[Page 75840]]
incur a total of 4,200 burden hours or an equivalent cost burden of
$166,152 to submit withdrawal responses annually.\227\ This results in
a total estimated annual burden of 12,600 hours or an equivalent cost
burden of $910,392 across both the initiating and non-initiating
parties.\228\
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\224\ This is calculated as follows: 0.25 hours per response x
$137.64 hourly rate for a compensation and benefits manager = $34.41
per response. 0.25 hours per response x $39.56 hourly rate for an
office clerk = $9.89 per response. $34.41 + $9.89 = $44.30 total per
response.
\225\ This is calculated as follows: 16,800 disputes x 0.5 labor
hours per dispute = 8,400 total burden hours. 16,800 disputes x
$44.30 per dispute = $744,240 total cost. As the Departments do not
anticipate these proposed rules would be finalized and effective
before July 1, 2024, the burden for 2024 would be prorated to 50
percent, or 4,200 hours with an equivalent cost of $372,120.
\226\ This is calculated as follows: 0.25 hours per response x
$39.56 hourly rate for an office clerk = $9.89 per response.
\227\ This is calculated as follows: 16,800 disputes x 0.25
labor hours per dispute = 4,200 total burden hours. 16,800 disputes
x $9.89 = $166,152 total cost. As the Departments do not anticipate
these proposed rules would be finalized and effective before July 1,
2024, the burden for 2024 would be prorated to 50 percent, or 2,100
hours with an equivalent cost of $83,076.
\228\ This is calculated as follows: 8,400 total initiating
party burden hours + 4,200 total non-initiating party burden hours =
12,600 overall total burden hours. $744,240 total initiating party
cost + $166,152 total non-initiating party cost = $910,392 overall
total cost. As the Departments do not anticipate these proposed
rules would be finalized and effective before July 1, 2024, the
burden for 2024 would be prorated to 50 percent, or 6,300 hours with
an equivalent cost of $455,196.
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As the Departments and OPM share jurisdictions, HHS would account
for 45 percent of the total burden, or approximately 5,670 burden
hours, with an equivalent cost of approximately $409,676. The
Departments of Labor and the Treasury would each account for 25 percent
of the total burden, or approximately 3,150 burden hours, with an
equivalent cost of approximately $227,598. OPM would account for 5
percent of the total burden, or approximately 630 burden hours, with an
equivalent cost of approximately $45,520. The Departments seek comment
on these assumptions.
[GRAPHIC] [TIFF OMITTED] TP03NO23.018
The Departments would revise the information collection currently
approved under OMB control number 1210-0169 to account for this
proposed burden.
7. ICRs Regarding Administrative and Certified IDR Entity Fee
Collection (26 CFR 54.9816-8(d), 29 CFR 2590.716-8(d), and 45 CFR
149.510(d))
The Departments propose to allow for the administrative fee due
from each party for participating in the Federal IDR process to be paid
to the Departments. The burden currently associated with this
requirement is the time and effort for a certified IDR entity to track
payments made by disputing parties and submit the administrative fees
to HHS upon invoice. In the No Surprises Act: IDR Process PRA
package,\229\ the Departments estimated that tracking payments made by
disputing parties and submitting the administrative fees to HHS upon
invoice would take a clerical worker (a secretary or administrative
assistant, not including legal, medical, or executive) approximately 18
hours annually (at a rate of $39.56 per hour). The Departments
estimated that each certified IDR entity would incur a burden of 18
hours annually at a cost of approximately $711 per certified IDR entity
to comply with the administrative fee reporting and submission
requirements.
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\229\ OMB Control Number: 1210-0169 (No Surprises Act: IDR
Process). The burden is estimated as follows: (18 hours x $39.56) =
$712.08 per certified IDR entity. A labor rate of $39.56 is used for
a clerical worker (a secretary or administrative assistant, not
including legal, medical, or executive). The labor rates are applied
in the following calculation: (13 certified IDR entities x 18 hours
x $39.56) = $9,257.04.
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Since this proposal would eliminate the requirement that certified
IDR entities collect the administrative fee on behalf of the
Departments, the Departments propose to rescind this information
collection. The burden associated with this information collection
estimated above would be removed if this proposal is finalized, since
certified IDR entities would no longer be collecting the administrative
fee moving forward.
The Departments estimate a total burden reduction, for 13 certified
IDR entities, of 234 hours, with an associated cost reduction of
approximately $9,257 beginning in 2025. As the Departments share
jurisdiction, HHS would account for 45 percent of the total burden
reduction, or a reduction of approximately 108 burden hours, with an
equivalent cost reduction of approximately $4,272. The Departments of
Labor and the Treasury would each account for 25 percent of the total
burden reduction, or approximately 54 burden hours each, with an
equivalent cost reduction of approximately $2,136. OPM would account
for 5 percent of the total burden reduction, or approximately 18 burden
hours, with an equivalent cost reduction of approximately $712. The
Departments seek comment on these assumptions.
[[Page 75841]]
[GRAPHIC] [TIFF OMITTED] TP03NO23.019
This information collection is approved under OMB control number
1210-0169, and if this proposal is finalized, the Departments would
rescind this information collection under OMB control number 1210-0169
accordingly. The Departments seek comment on this proposed burden
reduction.
The Departments also propose to collect one new information
collection element in the Federal IDR portal associated with the
administrative fee. The Departments propose to require the initiating
party to attest (for example, by checking a box) in the portal that no
offer made by either party during open negotiation exceeded a
predetermined threshold discussed in section II.E.3.f. of this
preamble, to determine whether the parties should be charged the
reduced administrative fee for low-dollar disputes. The Departments are
of the view that checking this box would take a de minimis amount of
time in the context of the total time it takes for the initiating party
to initiate a dispute--2.25 hours, as discussed further in the PRA
package for the Federal IDR process (OMB control number: 1210-0169).
The Departments will add this information collection element to the
information collection currently approved under OMB control number
1210-0169. The Departments seek comment on this proposed information
collection.
Although the Departments would now be collecting the administrative
fee directly from the disputing parties, rather than the certified IDR
entities collecting the fee on the Departments' behalf, generally, the
information collected from disputing parties and associated with this
step in the Federal IDR process would not change; the parties would be
submitting this information to the Departments rather than to the
certified IDR entities. Therefore, the Departments are of the view that
there is no additional information collection burden associated with
this proposal. The Departments seek comment on this assumption.
8. ICRs Regarding Extension of Time Periods for Extenuating
Circumstances (26 CFR 54.9816-8(g), 29 CFR 2590.716-8(g), and 45 CFR
149.510(g))
The Departments anticipate that codifying the ability of certified
IDR entities to submit case-by-case extension requests in the same
manner as parties would slightly increase the estimated burden
associated with collecting requests for extensions. In general, the
Departments maintain the expectation that requests for extensions due
to extenuating circumstances would be relatively limited, and do not
expect that certified IDR entities would submit a high volume of
requests for extensions, particularly since these proposed rules also
propose to codify the Departments' ability to grant case-by-case
extensions of their own initiative without a prior request from
certified IDR entities or parties. Based on internal data, the
Departments anticipate that certified IDR entities would submit
approximately 20 such requests for extensions annually.
The Departments estimate that it would take an office clerk
approximately 15 minutes (at an hourly rate of $39.56) on average to
prepare and submit the Request for Extension due to Extenuating
Circumstances form. Based on internal data reflecting the number of
extension requests submitted by certified IDR entities, the Departments
estimate that approximately 20 extensions requests would be submitted
by certified IDR entities annually. Accordingly, the Departments
estimate that the burden associated with the submission of the
extension request notice by certified IDR entities would result in a
total annual burden of 5 hours with an equivalent cost of approximately
$197.80 \230\ across all certified IDR entities in addition to the
existing burden estimate for extension requests submitted by plans,
issuers, FEHB carriers, providers, facilities, and air ambulance
services providers already approved under OMB 1210-0169. As the
Departments and OPM share jurisdictions, HHS would account for 45
percent of the total burden, or approximately 2.25 burden hours, with
an equivalent cost of approximately $89.01. The Departments of Labor
and the Treasury would each account for 25 percent of the total burden,
or approximately 1.25 burden hours each, with an equivalent cost of
approximately $49.45 each. OPM would account for 5 percent of the total
burden, or approximately 0.25 burden hours, with an equivalent cost of
approximately $9.89. The Departments seek comment on these assumptions.
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\230\ This is calculated as follows: 20 annual requests x 0.25
hours = 5 annual burden hours. 5 annual burden hours x $39.56 hourly
rate = $197.80 total annual cost. As the Departments do not
anticipate these proposed rules would be finalized and effective
before July 1, 2024, the burden for 2024 would be prorated to 50
percent, or 2.5 hours with an equivalent cost of $99.
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[[Page 75842]]
[GRAPHIC] [TIFF OMITTED] TP03NO23.020
The Departments would revise the information collection currently
approved under OMB control number 1210-0169 to account for this
additional burden.
9. ICRs Regarding Registration of Group Health Plans and Health
Insurance Issuers (26 CFR 54.9816-9, 29 CFR 2590.716-9, and 45 CFR
149.530)
These proposed rules would require plans and issuers that are
subject to the Federal IDR process to register and submit certain
information to the Departments.
The Departments assume that TPAs would register on behalf of most
self-insured plans. The Departments estimate that a total of 1,705
issuers and TPAs would incur a burden to comply with this provision.
The Departments estimate that for each issuer and TPA, an
administrative assistant would spend 8 hours (at an hourly rate of
$41.74), a compensation and benefits manager would spend 2 hours (at an
hourly rate of $137.64), and a lawyer would spend 2 hours (at an hourly
rate of $157.48), to communicate with plans, gather the necessary
information, and prepare the registration, resulting in a combined
hourly rate of $77.01. The estimated total burden for each issuer or
TPA would be 12 hours with an equivalent cost of approximately $924.16.
The estimated total cost for initial registration and submission of
information would be 20,460 hours, with an equivalent cost of
approximately $1,575,693. As the Departments and OPM share
jurisdictions, HHS would account for 45 percent of the total burden, or
approximately 9,207 burden hours, with an equivalent cost of
approximately $709,062. The Departments of Labor and the Treasury would
each account for 25 percent of the total burden, or approximately 5,115
burden hours, with an equivalent cost of approximately $393,923. OPM
would account for 5 percent of the total burden, or approximately 1,023
burden hours, with an equivalent cost of approximately $78,785.
The proposed regulation would also require that plans update the
information associated with their registration no later than 30 days
after such information changes or at least annually. The Departments
estimate that for each issuer and TPA, an administrative assistant
would spend 30 minutes (at an hourly rate of $41.74), and a
compensation and benefits manager would spend 15 minutes (at an hourly
rate of $137.64) to update information in a timely way when such
information changes, resulting in a combined hourly rate of $73.71. The
estimated total burden for each issuer or TPA would be 0.75 hours with
an equivalent cost of approximately $55.28. The Departments estimate
that updating information in a timely way would incur a total cost for
all issuers and TPAs of approximately 1,279 hours with an equivalent
cost of approximately $94,252 beginning in 2025. As the Departments and
OPM share jurisdictions, HHS would account for 45 percent of the total
burden, or approximately 575 burden hours, with an equivalent cost of
approximately $42,414. The Departments of Labor and the Treasury would
each account for 25 percent of the total burden, or approximately 320
burden hours, with an equivalent cost of approximately $23,563. OPM
would account for 5 percent of the total burden, or approximately 64
burden hours, with an equivalent cost of approximately $4,713.
BILLING CODE 6325-63-P; 4830-01-P; 4510-29-P; 4120-01-P
[GRAPHIC] [TIFF OMITTED] TP03NO23.021
[[Page 75843]]
[GRAPHIC] [TIFF OMITTED] TP03NO23.022
The Departments would revise the information collection currently
approved under OMB control number 1210-0169 to account for this new
burden.\231\ The Departments seek comment on these burden estimates.
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\231\ OMB Control Number: 0938-1401 (CMS-10780, Requirements
Related to Surprise Billing: Qualifying Payment Amount, Notice and
Consent, Disclosure on Patient Protections Against Balance Billing,
and State Law Opt-in).
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The information collections are summarized as follows:
[[Page 75844]]
[GRAPHIC] [TIFF OMITTED] TP03NO23.023
[[Page 75845]]
[GRAPHIC] [TIFF OMITTED] TP03NO23.024
BILLING CODE 6325-63-C; 4510-01-C; 4120-01-C
10. Submission of PRA-Related Comments\232\
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\232\ 840,000 respondents are duplicated between the open
negotiation and Federal IDR proess initiation information
collections becuase these respondents must complete open
negotiations to be a party to an initiated dispute; therefore, the
total number of respondents has been reduced to reflect an accurate
total of respondents.
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The Departments have submitted a copy of these proposed rules to
OMB for its review of the rule's information collection and
recordkeeping requirements. These requirements are not effective until
they have been approved by the OMB.
To obtain copies of the supporting statement and any related forms
for the proposed collections for control number 0938-1401, please visit
CMS's website at https://www.cms.gov/Regulations-and-Guidance/Legislation/PaperworkReductionActof1995/PRA-Listing. To obtain copies
of the supporting statement for control number 1210-0169, please go to
https://www.RegInfo.gov or email the request to [email protected] and
reference control number 1210-0169. The Departments invite public
comment on these potential information collection requirements.
Commenters may send their views on the Departments' PRA analysis in the
same way they send comments in response to these proposed rules as a
whole (for example, through the https://www.regulations.gov website),
including as part of a comment responding to the broader proposed
rules.
If you wish to comment, please submit your comments electronically
as specified in the ADDRESSES section of these proposed rules and
identify the rule (CMS-9897-P), the ICR's CFR citation, CMS ID number,
and OMB control number.
ICR-related comments are due January 2, 2024.
G. Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA) (5 U.S.C. 601, et seq.)
requires agencies to analyze options for regulatory relief of small
entities to prepare an initial regulatory flexibility analysis to
describe the impact of these proposed rules on small entities, unless
the head of the agency can certify that the rule will not have a
significant economic impact on a substantial number of small entities.
The RFA generally defines a ``small entity'' as (1) a proprietary firm
meeting the size standards of the Small Business Administration (SBA),
(2) a not-for-profit organization that is not dominant in its field, or
(3) a small government jurisdiction with a population of less than
50,000. States and individuals are not included in the definition of
``small entity.'' The Departments use a change in revenues of more than
3 to 5 percent as its measure of significant economic impact on a
substantial number of small entities. For purposes of the RFA, small
entities include small businesses, nonprofit organizations, and small
governmental jurisdiction.
1. Need for Regulatory Action, Objectives, and Legal Basis
This proposed rulemaking authorized by the No Surprises Act is
intended to address specific issues that are critical to ensuring the
timely rendering of payment determinations and to address feedback from
interested parties and certified IDR entities to improve the
functioning of the Federal IDR process. These proposed rules are
intended to address some of the common communication issues between
disputing parties stemming from a lack of clarity as to whether items
and services are qualified IDR items and services covered by the No
Surprises Act. These proposed rules would impose requirements and
create incentives for parties to engage with one another during the
open negotiation period, which would help reduce the volume of
ineligible disputes being submitted. Specifically, these proposed rules
would make changes to the information that plans, issuers, providers,
facilities, and providers of air ambulance services must share before
initiating the Federal IDR process by including proposals at 26 CFR
54.9816-6A, 29 CFR 2590.716-6A, and 45 CFR 149.100 to require plans and
issuers to provide CARCs and RARCs when providing any paper or
electronic remittance in response to a claim for payment for health
care items or services furnished by an entity with which it does not
have a direct or indirect contractual relationship. Additionally, the
Departments propose amendments at 26 CFR 54.9816-6, 29 CFR 2590.716-6,
and 45 CFR 149.140 to the information that must be disclosed about the
QPA. These proposed rules would also establish new requirements at 26
CFR 54.9816-9, 29 CFR 2590.716-9, and 45 CFR 149.530, which would
require plans and issuers to register with the Federal IDR portal to
better enable a provider, facility, or provider of air ambulance
services to identify the appropriate plan or issuer with which it has a
dispute and determine whether its coverage of an item or service is
subject to a specified State law, an All-Payer
[[Page 75846]]
Model Agreement, or the Federal IDR process for determining the out-of-
network rate.
To further facilitate communication and improve open negotiations,
these proposed rules would amend the open negotiation process that
precedes the Federal IDR process. Specifically, at 26 CFR 54.9816-
8(b)(1), 29 CFR 2590.716-8(b)(1), and 45 CFR 149.510(b)(1), these
proposed rules would amend the content requirements of the standard
open negotiation notice, would establish requirements related to an
open negotiation response notice, and would clarify the timing for when
the open negotiation period begins. These proposed rules would also
amend the process for initiating the Federal IDR process. Specifically,
at 26 CFR 54.9816-8(b)(2), 29 CFR 2590.716-8(b)(2), and 45 CFR
149.510(b)(2), these proposed rules would amend the content of the
notice of IDR initiation and establish new requirements for a notice of
IDR initiation response from the non-initiating party. At 26 CFR
54.9816-8T(b)(3), 29 CFR 2590.716-8(b)(3), and 45 CFR 149.510(b)(3),
these proposed rules would also establish a new manner for providing
notices to the other party and the Departments.
These proposed rules would also provide additional clarity
regarding timeframes within the Federal IDR process. The No Surprises
Act includes certain timeframes by which certain steps of the Federal
IDR process must be conducted. For example, disputing parties must
jointly select a certified IDR entity not later than the last day of
the 3-business-day period following the date of the initiation of the
Federal IDR process, and if the parties fail to jointly select a
certified IDR entity, the Departments must select a certified IDR
entity not later than 6 business days after the date of IDR
initiation.\233\ While the No Surprises Act also provides detailed
timeframes for certain other steps in the process, the steps that must
be conducted before a payment determination can be issued are not as
clearly defined, such as when a certified IDR entity must conduct a
conflict-of-interest review and must determine whether an item or
service is a qualified IDR item or service, as defined in 26 CFR
54.9816-8T(a)(2)(xi), 29 CFR 2590.716-8(a)(2)(xi), and 45 CFR
149.510(a)(2)(xi), and eligible for the Federal IDR process. Therefore,
the provisions in these proposed rules would adjust certain steps and
establish associated timeframes (see Table 1). These include provisions
related to establishing a process for preliminary selection of the
certified IDR entity and final selection of the certified IDR entity as
set out in 26 CFR 54.9816-8(c)(1), 29 CFR 2590.716-8(c)(1), and 45 CFR
149.510(c)(1), in order to account for the time it takes certified IDR
entities to confirm that they do not have a conflict of interest with
either party. To allow more time for certified IDR entities to conduct
eligibility reviews, these proposed rules would include proposed
amendments to the Federal IDR process eligibility review proposed in 26
CFR 54.9816-8T(c)(2), 29 CFR 2590.716-8(c)(2), and 45 CFR 149.510
(c)(2). As discussed in section I.H. of this preamble, eligibility
reviews have proven to be complex and time consuming. In extenuating
circumstances, such as when dispute volume is high, it may be more
appropriate for the Departments, rather than certified IDR entities, to
conduct eligibility reviews to facilitate quicker dispute processing.
Therefore, these proposed rules would establish a Departmental
eligibility review process in proposed paragraph 26 CFR 54.9816-
8(c)(2)(ii), 29 CFR 2590.716-8(c)(2)(ii), and 45 CFR 149.510
(c)(2)(ii). Further, to support eligibility determinations, conflict-
of-interest reviews, and payment determinations, the Departments
propose requirements for the submission of additional information from
the disputing parties at 26 CFR 54.9816-8(c)(2)(iii), 29 CFR 2590.716-
8(c)(2)(iii), and 45 CFR 149.510(c)(2)(iii). To clarify and establish a
standard process for disputes to be withdrawn from the Federal IDR
process, the Departments propose four conditions in which a dispute may
be withdrawn at 26 CFR 54.9816-8(c)(3)(i), 29 CFR 2590.716-8(c)(3)(i),
and 45 CFR 149.510(c)(3)(ii). To further adjust timeframes and
processes associated with the Federal IDR process, these proposed rules
would include proposed amendments related to submission of offers and
payment determination and notification at 26 CFR 54.9816-8(c)(5), 29
CFR 2590.716-8(c)(5), and 45 CFR 149.510(c)(5); the collection of the
certified IDR entity fee at 26 CFR 54.9816-8(d)(1), 29 CFR 2590.716-
8(d)(1), and 45 CFR 149.510(d)(1); and the collection of the
administrative fee, including a process for setting a reduced
administrative fee for low-dollar amount disputes and for non-
initiating parties in cases of ineligible disputes, at 26 CFR 54.9816-
8(d)(2), 29 CFR 2590.716-8(d)(2), and 45 CFR 149.510(d)(2). These
proposed rules also include provisions to expand upon situations in
which Federal IDR process timeframes may be waived due to extenuating
circumstances at 26 CFR 54.9816-8T(g), 29 CFR 2590.716-8(g), and 45 CFR
149.510(g).
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\233\ Section 9816(c)(4)(F) of the Code, section 716(c)(4)(F) of
ERISA, and section 2799A-1(c)(4)(F) of the PHS Act.
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Lastly, to address concerns regarding the vacated batching
provision at 26 CFR 54.9816-8(c)(3)(i)(C), 29 CFR 2590.716-
8(c)(3)(i)(C), and 45 CFR 149.510(c)(3(i)(C) and to create more
efficiencies in the process, these proposed rules at 26 CFR 54.9816-
8(c)(4), 29 CFR 2590.716-8(c)(4), and 45 CFR 149.510(c)(4) include
provisions that would allow for more flexibility in batching multiple
items or services in a single dispute.
It is the Departments' intention that the implementation of the
proposed provisions in these proposed rules, if finalized, would lead
to a more efficient Federal IDR process and more timely payment
determinations.
2. Small Entities Regulated
The provisions in these proposed rules would affect plans (or their
TPAs), health insurance issuers offering group or individual health
insurance coverage, certified IDR entities, and providers, facilities,
and providers of air ambulance services.
For purposes of analysis under the RFA, the Departments consider an
employee benefit plan with fewer than 100 participants to be a small
entity.\234\ The basis of this definition is found in section
104(a)(2), which permits the Secretary of Labor to prescribe simplified
annual reports for plans that cover fewer than 100 participants. Under
section 104(a)(3), the Secretary may also provide for exemptions or
simplified annual reporting and disclosure for welfare benefit plans.
Under the authority of section 104(a)(3), DOL has previously issued
simplified reporting provisions and limited exemptions from reporting
and disclosure requirements for small plans, including unfunded or
insured welfare plans, which cover fewer than 100 participants and
satisfy certain requirements.\235\ While some large employers have
small plans, small plans are generally maintained by small employers.
Thus, the Departments are of the view that assessing the impact of
these proposed rules on small plans is an appropriate substitute for
evaluating the effect on small entities. The definition of a small
entity considered
[[Page 75847]]
appropriate for this purpose differs, however, from a definition of a
small business based on size standards issued by the SBA \236\ in
accordance with the Small Business Act.\237\
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\234\ The Department of Labor consulted with the Small Business
Administration Office of Advocacy in making this determination, as
required by 5 U.S.C. 603(c) and 13 CFR 121.903(c) in a memo dated
June 4, 2020.
\235\ See 29 CFR 2520.104-20, 2520.104-21, 2520.104-41,
2520.104-46, and 2520.104b-10.
\236\ 13 CFR 121.201 (2011).
\237\ 15 U.S.C. 631 et seq. (2011).
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In 2021, there were 1,500 issuers in the U.S. health insurance
market \238\ and 205 TPAs.\239\ Health insurance issuers are generally
classified under the North American Industry Classification System
(NAICS) code 524114 (Direct Health and Medical Insurance Carriers).
According to SBA size standards,\240\ entities with average annual
receipts of $47 million or less are considered small entities for this
NAICS code. The Departments expect that few, if any, insurance
companies underwriting health insurance policies fall below these size
thresholds. Based on data from MLR annual report submissions for the
2021 MLR reporting year, approximately 87 out of 483 issuers of health
insurance coverage nationwide had total premium revenue of $47 million
or less.\241\ However, it should be noted that also based on MLR data,
over 77 percent of these small companies belong to larger holding
groups, and many, if not all, of these small companies, are likely to
have non-health lines of business that would result in their revenues
exceeding $47 million. The Departments are of the view that the same
assumptions also apply to TPAs that would be affected by these proposed
rules.\242\ To produce a conservative estimate, for the purposes of
this analysis, the Departments assume 4.1 percent, or 62 health
insurance issuers and 8 TPAs, of the total of 1,500 health insurance
issuers and 205 TPAs across the country, are considered small
entities.\243\ The Departments seek comment on this assumption.
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\238\ Centers for Medicare and Medicaid Services. (2022).
Medical Loss Ratio Data and System Resources. https://www.cms.gov/CCIIO/Resources/Data-Resources/mlr. There are 483 issuers of health
insurance coverage nationwide and 1,500 issuer-State combinations.
\239\ Non-issuer TPAs based on data derived from the 2016
benefit year reinsurance program contributions.
\240\ United States Small Business Administration. (March 17,
2023). Table of Size Standards. https://www.sba.gov/document/support--table-size-standards.
\241\ Centers for Medicare and Medicaid Services. (2022).
Medical Loss Ratio Data and System Resources. https://www.cms.gov/CCIIO/Resources/Data-Resources/mlr.
\242\ The Departments are of the view that most TPAs are also
issuers.
\243\ These numbers are calculated as follows: 77 percent of
small companies belong to larger holding groups, so 23 percent do
not and would be small entities. 87 issuers x 0.23 = 20. 20/483 =
4.1 percent. Applying the 4.1 percent to 1,500 issuers and 205 TPAs
total = 62 small issuers and 8 small TPAs.
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These proposed rules would also affect health care providers due to
the proposed requirements for the initiating party to submit the open
negotiation notice to the non-initiating party and the Departments,
among other proposals.\244\ The Departments estimate that 140,270
physicians, on average, bill on an out-of-network basis. The number of
small physicians is estimated based on the SBA's size standards. The
size standard applied for providers is NAICS 62111 (Offices of
Physicians), for which a business with less than $16 million in
receipts is considered to be small. By this standard, the Departments
estimate that 47.2 percent or 66,207 physicians are considered small
under the SBA's size standards.\245\ These proposed rules are also
expected to affect non-physician providers who bill on an out-of-
network basis. The Departments lack data on the number of non-physician
providers who would be impacted.
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\244\ Historically, less than 1 percent of disputes for
emergency and non-emergency services have been submitted by group
health plans, health insurance issuers, or FEHB carriers. See U.S.
Department of Labor, U.S. Department of the Treasury, and U.S.
Department of Health and Human Services. (December 15, 2022) Initial
Report on the Federal Independent Dispute Resolution (IDR) Process,
April 15--September 30, 2022. https://www.cms.gov/files/document/initial-report-idr-april-15-september-30-2022.pdf.
\245\ Based on data from the NAICS Association for NAICS code
62111, the Departments estimate the percent of businesses within the
industry of Offices of Physicians with less than $16 million in
annual sales. See https://www.census.gov/data/tables/2017/econ/susb/2017-susb-annual.html.
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The Departments do not have the same level of data for the air
ambulance sub-sector. In 2020, the total revenue of providers of air
ambulance services was estimated to be $4.2 billion, with 1,114 air
ambulance bases.\246\ This results in an industry average of $3.8
million per air ambulance base. Based on a 2020 U.S.C.-Brookings
Schaeffer report on air ambulance services,\247\ by 2017, large private
equity firms controlled roughly two-thirds of the air ambulance market.
The Departments seek comment on the number of small entities in the air
ambulance market.
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\246\ ASPE Office of Health Policy. (September 10, 2021). Air
Ambulance Use and Surprise Billing. https://aspe.hhs.gov/sites/default/files/2021-09/aspe-air-ambulance-ib-09-10-2021.pdf.
\247\ Adler, L., Hannick, K., and Lee, S. High Air Ambulance
Charges Concentrated in Private Equity-Owned Carriers. U.S.C.-
Brookings Schaffer Initiative for Health Policy. October 13, 2020.
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Although based on the Departments' experience operating the Federal
IDR process, significantly fewer than 66,207 small providers have
accessed the process to date, and the vast majority of disputes are
initiated by 10 large revenue cycle management companies or provider
groups,\248\ the Departments lack adequate data to better inform the
number of small providers impacted by these proposed rules. The
Departments are also aware that many providers are subject to a
specified State law or All-Payer Model Agreement, rather than the
Federal IDR process, and therefore would not have reason to access the
Federal IDR process or need to review these proposed rules.\249\
Therefore, although the Departments acknowledge that 66,207 small
providers is likely a significant overestimate of the number of small
providers impacted by these proposed rules, the Departments use this
number of small providers in this analysis to be conservative. The
Departments seek comment on this assumption.
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\248\ See U.S. Department of Health and Human Services, U.S.
Department of Labor, and U.S. Department of the Treasury, Partial
Report on the Federal Independent Dispute Resolution (IDR) Process,
October 1--December 31, 2022. (n.d.). https://www.cms.gov/files/document/partial-report-idr-process-octoberdecember-2022.pdf.
\249\ See Chart for Determining the Applicability for the
Federal Independent Dispute Resolution (IDR) Process (n.d.). https://www.cms.gov/files/document/caa-federal-idr-applicability-chart.pdf.
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Additionally, as discussed in the Partial Report on the Federal
Independent Dispute Resolution (IDR) Process, October 1--December 31,
2022, the top 10 initiating parties initiate approximately 85 percent
of disputes, and the top 10 non-initiating parties are initiated
against in approximately 95 percent of disputes.\250\ These top 10
parties are large provider groups or revenue cycle management groups
and large insurance companies or their representatives. Therefore, for
purposes of this analysis, the Departments assume that only 15 percent
of all disputes involve small providers. The 5 percent of all disputes
that do not involve the top 10 non-initiating parties could involve any
of the 1,695 issuers and TPAs that are not the top 10 non-initiating
parties (1,500 issuers and 205 TPAs total - 10 top non-initiating
parties = 1,695 remaining issuers and TPAs). The Departments assume
that the same proportion of small issuers and TPAs to all issuers and
TPAs also applies to the number of disputes each issuer or TPA is
involved in, as small issuers and TPAs cover fewer enrollees than large
issuers and TPAs. The Departments seek comment on this assumption.
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\250\ Id.
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3. Compliance Requirements
The proposed policies that would result in an increased burden to
small entities are described below.
[[Page 75848]]
The Departments propose to require that plans and issuers use CARCs
and RARCs to convey information related to the No Surprises Act, on
electronic and paper remittance advice. The annual burden per issuer/
TPA associated with this proposal is $909. For more details, please
refer to section V.D.2.a. of this preamble.
The Departments also propose to amend the information plans and
issuers must provide related to the QPA with an initial payment or
notice of denial of payment. The one-time burden per issuer/TPA
associated with this proposal is $297. For more details, please refer
to V.F.2 of this preamble.
Additionally, the Departments propose to require the party to
provide an open negotiation notice and supporting documentation to the
other party and the Departments to initiate the open negotiation
period. Furthermore, the party in receipt of the open negotiation
notice would be required to provide a response to the open negotiation
notice that is provided to the other party and the Departments within
the first 15 business days of the 30-business-day open negotiation
period. The annual burden per small provider associated with this
proposal is $79,\251\ and the annual burden per small issuer/TPA
associated with this proposal is $1,338.\252\ For more details, please
refer to section V.F.3. of this preamble.
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\251\ 560,000 disputes in open negotiations--85 percent
(476,000) disputes entered into open negotiations by the top 10
initiating parties = 84,000 disputes entered into open negotiations
by other initiating parties. 84,000 disputes/66,207 small providers
= approximately 1 dispute initiated per small provider annually. 1
dispute x $78.71 per dispute = $79 per small provider.
\252\ 560,000 disputes in open negotiations--95 percent
(532,000) disputes entered into open negotiations against the top 10
non-initiating parties = 28,000 disputes entered into open
negotiations against other non-initiating parties. 28,000 disputes/
1,695 issuers/TPAs = 17 disputes per issuer/TPA. 17 disputes x
$78.71 per dispute = $1,338 per small issuer/TPA.
---------------------------------------------------------------------------
Furthermore, the Departments propose to continue requiring the
initiating party to submit a written notice of IDR initiation to the
non-initiating party and to the Departments. The Departments also
propose that the non-initiating party must submit a written response to
the notice of IDR initiation to the initiating party and to the
Departments. The annual burden per small provider associated with this
proposal is $79,\253\ and the annual burden per small issuer/TPA
associated with this proposal is $945.\254\ For more details, please
refer to section V.F.4.a. of this preamble.
---------------------------------------------------------------------------
\253\ 420,000 disputes initiated--85 percent (357,000) disputes
initiated by the top 10 initiating parties = 63,000 disputes
initiated by other initiating parties. 63,000 disputes/66,207 small
providers = approximately 1 dispute initiated per small provider
annually. 1 dispute x $78.71 per dispute = $79 per small provider.
\254\ 420,000 disputes initiated--95 percent (399,000) disputes
initiated against the top 10 non-initiating parties = 21,000
disputes initiated against other non-initiating parties. 21,000
disputes/1,695 issuers/TPAs = 12 disputes per issuer/TPA annually.
12 disputes x $78.71 per dispute = $945 per small issuer/TPA.
---------------------------------------------------------------------------
Additionally, the Departments propose to revise the content in the
notice of certified IDR entity selection form to reflect that this
notice would only be used in situations in which the non-initiating
party disagrees with the initiating party's preferred certified IDR
entity identified in the notice of IDR initiation form. The annual
burden per small provider associated with this proposal is $21,\255\
and the annual burden per small issuer/TPA associated with this
proposal is $85.\256\ For more details, please refer to section
V.F.4.b. of this preamble.
---------------------------------------------------------------------------
\255\ 120,200 disputes for which a notice of certified IDR
entity selection is required--85 percent (102,170) disputes
initiated by the top 10 initiating parties = 18,030 disputes for
other initiating parties. 18,030 disputes/66,207 small providers =
less than 1 dispute per small provider annually. 1 dispute x $21.14
= $21 per small provider.
\256\ 120,200 disputes for which a notice of certified IDR
entity selection is required--95 percent (114,190) disputes
initiated against the top 10 non-initiating parties = 6,010 disputes
for other non-initiating parties. 6,010 disputes/1,695 issuers/TPAs
= 4 disputes per issuer/TPA annually. 4 disputes x $21.14 = $85 per
small issuer/TPA.
---------------------------------------------------------------------------
Moreover, the Departments propose to establish a process for
disputes to be withdrawn from the Federal IDR process, including the
creation of new notice of withdrawal and notice of withdrawal response
forms. The annual burden per small provider associated with this
proposal is $44,\257\ and the annual burden per small issuer/TPA
associated with this proposal is $10.\258\ For more details, please
refer to section V.F.6. of this preamble.
---------------------------------------------------------------------------
\257\ 16,800 disputes withdrawn--85 percent (14,280) disputes
withdrawn by the top 10 initiating parties = 2,520 disputes
withdrawn by other initiating parties. 2,520 disputes/66,207 small
providers = less than 1 dispute withdrawn per small provider
annually. 1 dispute x $44.30 per dispute = $44 per small provider.
\258\ 16,800 disputes withdrawn--95 percent (15,960) disputes
withdrawn against the top 10 non-initiating parties = 840 disputes
withdrawn against other non-initiating parties. 840 disputes/1,695
issuers/TPAs = less than 1 dispute withdrawn per issuer/TPA
annually. 1 dispute x $9.89 per dispute = $10 per small issuer/TPA.
---------------------------------------------------------------------------
Additionally, for disputes initiated on or after January 1, 2025,
the Departments propose to establish the administrative fee amount at
$150 per party per dispute, a reduced administrative fee amount for
both parties in low-dollar disputes of $75 per party per dispute, and a
reduced administrative fee for non-initiating parties in ineligible
disputes of $30 per party per dispute. The annual burden per small
provider associated with this proposal is $150,\259\ and the annual
burden per small issuer/TPA is $1,290.\260\ For more details, please
refer to section V.D.2.i.i. of this preamble.
---------------------------------------------------------------------------
\259\ 420,000 disputes initiated--85 percent (357,000) disputes
initiated by the top 10 initiating parties = 63,000 disputes
initiated by other initiating parties. 63,000 disputes/66,207 small
providers = approximately 1 dispute initiated per small provider
annually. 1 dispute x $150 per dispute = $150 per small provider.
\260\ 420,000 disputes initiated--95 percent (399,000) disputes
initiated against the top 10 non-initiating parties = 21,000
disputes initiated against other non-initiating parties. 21,000
disputes/1,695 issuers/TPAs = 12 disputes per small issuer/TPA
annually. Of those 12 disputes, issuers/TPAs would pay a $75
administrative fee for 16 percent (or 2 disputes), a $30
administrative fee for 22 percent (or 3 disputes), and a $150
administrative fee for 62 percent (or 7 disputes). (2 disputes x $75
per dispute) + (3 disputes x $30 per dispute) + (7 disputes x $150
per dispute) = $1,290.
---------------------------------------------------------------------------
Finally, the Departments propose to require plans and issuers to
submit information to the Departments to receive a registration number.
The initial (one-time) burden per issuer/TPA associated with this
proposal is $924, and the annual burden per issuer/TPA associated with
this proposal is $55. For more details, please refer to section V.F.9.
of this preamble.
The Departments estimate the one-time cost to review the rule would
be $1,575 per entity. For more details, please refer to section V.D.4.
of this preamble.
Thus, the per-entity estimated annual cost for each small issuer/
TPA is $4,632, and the per-entity estimated annual cost for each small
provider is $373. The total annual cost for small issuers and TPAs is
$324,240, and the total annual cost for small providers is $24,695,211.
The per-entity estimated one-time cost for each small issuer/TPAs is
$2,796, and the per-entity estimated one-time cost for each small
provider is $1,575. The total one-time cost for small issuers and TPAs
is $195,720, and the total one-time cost for small providers is
$622,125. See Tables 20, 21, 22, and 23.
BILLING CODE 6325-63-P; 4830-01-P; 4510-29-P; 4120-01-P
[[Page 75849]]
[GRAPHIC] [TIFF OMITTED] TP03NO23.025
[GRAPHIC] [TIFF OMITTED] TP03NO23.026
[GRAPHIC] [TIFF OMITTED] TP03NO23.027
[GRAPHIC] [TIFF OMITTED] TP03NO23.028
BILLING CODE 6325-63-C; 4830-01-C; 4510-29-C; 4120-01-C
The annual cost per small provider of $373 is approximately 0.03
percent of the average annual receipts per small provider. The
Departments anticipate that small providers would be unlikely to
initiate disputes and thereby incur these costs unless they anticipate
prevailing in the dispute and receiving payment from issuers or TPAs
that exceed the costs incurred to initiate the dispute. The Departments
therefore are of the view that small providers could experience an
increase in receipts commensurate or larger than the increase in costs.
The annual cost per small issuer/TPA of $4,632 is approximately 0.25
percent of the average annual receipts per small issuer/TPA. The
Departments anticipate that small issuers/TPAs could pass on these
increased costs to consumers in the form of higher premiums (or for
TPAs, higher administration fees), resulting in an increase in receipts
commensurate with the increase in costs. However, the Departments are
of the view that the actual increase in costs and subsequent impact on
revenue is de minimis and likely to decrease due to the proposals in
these rules, as many proposals are anticipated to result in increased
efficiency and fewer dispute initiations, as discussed further in
section V.D.1.l. of this preamble. Additionally, the Departments
anticipate that by batching qualified IDR items and services, there may
be a reduction in the per-service cost of the Federal IDR process, and
potentially the aggregate administrative costs, because the Federal IDR
process is likely to exhibit at least some economies of scale.\261\ The
Departments seek comment on these assumptions.
---------------------------------------------------------------------------
\261\ Fielder, M., Adler, L., Ippolito, B. (March 16, 2021).
Recommendations for Implementing the No Surprises Act. U.S.C.-
Brookings Schaeffer on Health Policy. https://www.brookings.edu/blog/usc-brookings-schaeffer-on-health-policy/2021/03/16/recommendations-for-implementing-the-no-surprises-act/.
---------------------------------------------------------------------------
Thus, the Departments do not anticipate that these proposed rules
would have a significant impact on a substantial number of small
entities, based on the HHS threshold of 3 to 5 percent change in
revenue. The Departments seek comment on this analysis and seek
information on the
[[Page 75850]]
number of small issuers, TPAs, or providers that may be affected by the
provisions in these proposed rules, as well as any additional costs
associated with these proposed rules that could have a significant
economic impact on a substantial number of small entities.
4. Duplication, Overlap, and Conflict With Other Rules and Regulations
The Departments do not anticipate any duplication, overlap, or
conflict with other rules and regulations associated with these
proposed rules. These proposed rules revise current regulations and add
new regulations to continue to implement the No Surprises Act and
improve the Federal IDR process. The Departments seek comment on any
duplication, overlap, or conflict with other rules and regulations
identified by interested parties.
5. Significant Alternatives
The regulatory alternatives considered in developing these proposed
rules are discussed in section V.E. of this preamble. The Departments
are of the view that none of these alternatives would both achieve the
policy objectives and goals of these proposed rules as previously
stated and be less burdensome to small entities. For example, although
the proposals pertaining to the open negotiation notice and response,
initiation notice and response, selection form and response, and
withdrawal form and response may impose costs on small entities, these
proposals are critical to ensure the exchange of information between
the parties in a standardized time and format, in order to reduce
wasted effort for the parties at other stages of the Federal IDR
process due to inappropriately or incorrectly initiated open
negotiations or Federal IDR process disputes. Although the Departments
recognize that the less stringent timetables considered in certain
regulatory alternatives described in section V.E. of this preamble may
account for the resources available to small entities, they would be
contrary to the policy objectives of these proposed rules. Alternative
timelines for small entities for any of the policy proposals described
in these rules were not considered. The Departments did not identify
any alternatives to these proposals that would be less burdensome to
small entities while still achieving the objectives of these proposed
rules. In addition, the proposals pertaining to the administrative fee
may impose costs on small entities, but the proposed $150
administrative fee amount in these proposed rules for disputes
initiated on or after January 1, 2025 is the same as the proposed
administrative fee amount for disputes initiated on or after January 1,
2024,\262\ and these proposed rules further propose to reduce the
administrative fee amount for both parties in low-dollar disputes and
non-initiating parties in ineligible disputes. Therefore, although some
of the regulatory alternatives considered may have led to minor
reduction in burden to small entities, we believe they would ultimately
undermine the proposals to reduce the cost to initiate a Federal IDR
process dispute for small entities in certain situations, which we
believe will confer a far greater benefit to small entities.
---------------------------------------------------------------------------
\262\ See Federal Independent Dispute Resolution (IDR) Process
Administrative Fee and Certified IDR Entity Fee Ranges proposed
rules. 88 FR 65888 (September 26, 2023).
---------------------------------------------------------------------------
For a more detailed discussion of the regulatory alternatives
considered, please reference section V.E. of this preamble.
6. Small Rural Hospitals
In addition, section 1102(b) of the Social Security Act requires
the Departments to prepare a regulatory impact analysis if a rule may
have a significant impact on the operations of a substantial number of
small rural hospitals. This analysis must conform to the provisions of
section 603 of the RFA. For purposes of section 1102(b) of the Act, the
Departments define a small rural hospital as a hospital that is located
outside of a metropolitan statistical area and has fewer than 100 beds.
The Departments have determined that these proposed rules will not
affect small rural hospitals and that these proposed rules are not
subject to section 1102(b) of the Act. Therefore, the Secretary
certifies that these proposed rules will not have a significant
economic impact on a substantial number of small rural hospitals.
H. Special Analyses--Department of the Treasury
Pursuant to the Memorandum of Agreement, Review of Treasury
Regulations under Executive Order 12866 (June 9, 2023), tax regulatory
actions issued by the IRS are not subject to the requirements of
section 6 of Executive Order 12866, as amended. Therefore, a regulatory
impact assessment is not required. Pursuant to section 7805(f) of the
Code, these regulations have been submitted to the Chief Counsel for
Advocacy of the Small Business Administration for comment on their
impact on small business.
I. Unfunded Mandates Reform Act
Section 202 of the Unfunded Mandates Reform Act of 1995 (UMRA)
requires that agencies assess anticipated costs and benefits and take
certain other actions before issuing a proposed rule or any final rule
for which a general notice of proposed rulemaking was published that
includes any Federal mandate that may result in expenditures in any 1
year by State, local, or tribal governments, in the aggregate, or by
the private sector, of $100 million in 1995 dollars, updated annually
for inflation. That threshold is approximately $177 million in 2023. As
discussed earlier in the RIA, plans, issuers, TPAs, certified IDR
entities, and providers, facilities, and providers of air ambulance
services would incur costs to comply with the proposed provisions of
these proposed rules. The Departments estimate the combined impact on
State, local, or tribal governments and the private sector would not be
above the threshold.
J. Federalism
Executive Order 13132 outlines the fundamental principles of
federalism. It requires adherence to specific criteria by Federal
agencies in formulating and implementing policies that have
``substantial direct effects'' on the States, the relationship between
the national government and States, or on the distribution of power and
responsibilities among the various levels of government. Federal
agencies issuing regulations that have these federalism implications
must consult with State and local officials and describe the extent of
their consultation and the nature of the concerns of State and local
officials in the preamble to these proposed rules.
The Departments do not anticipate that these proposed rules would
have any federalism implications or limit the policy-making discretion
of the States in compliance with the requirement of Executive Order
13132. The Departments recognize that at least one State (and possibly
more) currently require the use of CARCs and RARCs to communicate
information related to the applicability of State balance billing laws.
In these instances, these proposed rules would not infringe upon the
State's ability to continue to specify its requirements related to
using CARCs and RARCs.
State and local government health plans may be subject to the
Federal IDR process where a specified State law or All-Payer Model
Agreement does not apply. The No Surprises Act authorizes States to
enforce the new requirements, including those related to balance
[[Page 75851]]
billing, for issuers, providers, facilities, and providers of air
ambulance services, with HHS enforcing only in cases where the State
has notified HHS that the State does not have the authority to enforce
or is otherwise not enforcing, or HHS has made a determination that a
State has failed to substantially enforce the requirements. However, in
the Departments' view, the federalism implications of these proposed
rules are substantially mitigated because some States have their own
process for determining the total amount payable under a plan or
coverage for out-of-network emergency services and to out-of-network
providers for patient visits to in-network facilities. Where a State
has a specified State law, the State law, rather than the Federal IDR
process, would apply. The Departments anticipate that some States, with
their own process, may want to change their laws or adopt new laws in
response to these proposed rules. The Departments anticipate that these
States would incur a small incremental cost when making changes to
their laws.
In compliance with the requirement of Executive Order 13132 that
agencies examine closely any policies that may have federalism
implications or limit the policy making discretion of the States, the
Departments have engaged in efforts to consult with and work
cooperatively with affected States, including participating in
conference calls with and attending conferences of the National
Association of Insurance Commissioners and consulting with State
insurance officials on an individual basis.
While developing these rules, the Departments attempted to balance
the States' interests in regulating health insurance issuers with the
need to ensure market stability. By doing so, the Departments complied
with the requirements of Executive Order 13132.
Laurie Bodenheimer,
Associate Director, Healthcare and Insurance, Office of Personnel
Management.
Douglas W. O'Donnell,
Deputy Commissioner for Services and Enforcement, Internal Revenue
Service.
Lisa M. Gomez,
Assistant Secretary, Employee Benefits Security Administration,
Department of Labor.
Xavier Becerra,
Secretary, Department of Health and Human Services.
List of Subjects
5 CFR Part 890
Administrative practice and procedure, Government employees, Health
facilities, Health insurance, Health professions, Reporting and
recordkeeping requirements.
26 CFR Part 54
Excise taxes, Pensions, Reporting and recordkeeping requirements.
29 CFR Part 2590
Continuation coverage, Disclosure, Employee benefit plans, Group
health plans, Health care, Health insurance, Medical child support,
Reporting and recordkeeping requirements.
45 CFR Part 149
Balance billing, Health care, Health insurance, Reporting, and
recordkeeping requirements, Surprise billing, State regulation of
health insurance, and Transparency in coverage.
OFFICE OF PERSONNEL MANAGEMENT
For the reasons stated in the preamble, the Office of Personnel
Management proposes to amend 5 CFR part 890 as set forth below:
PART 890--FEDERAL EMPLOYEES HEALTH BENEFITS PROGRAM
0
1. The authority citation for part 890 continues to read as follows:
Authority: 5 U.S.C. 8913; Sec. 890.102 also issued under
sections 11202(f), 11232(e), and 11246(b) of Pub. L. 105-33, 111
Stat. 251; Sec. 890.111 also issued under section 1622(b) of Pub. L.
104-106, 110 Stat. 521 (36 U.S.C. 5522); Sec. 890.112 also issued
under section 1 of Pub. L. 110-279, 122 Stat. 2604 (2 U.S.C. 2051);
Sec. 890.113 also issued under section 1110 of Pub. L. 116-92, 133
Stat. 1198 (5 U.S.C. 8702 note); Sec. 890.301 also issued under
section 311 of Pub. L. 111-3, 123 Stat. 64 (26 U.S.C. 9801); Sec.
890.302(b) also issued under section 1001 of Pub. L. 111-148, 124
Stat. 119, as amended by Pub. L. 111-152, 124 Stat. 1029 (42 U.S.C.
300gg-14); Sec. 890.803 also issued under 50 U.S.C. 3516 (formerly
50 U.S.C. 403p) and 22 U.S.C. 4069c and 4069c-1; subpart L also
issued under section 599C of Pub. L. 101-513, 104 Stat. 2064 (5
U.S.C. 5561 note), as amended; and subpart M also issued under
section 721 of Pub. L. 105-261 (10 U.S.C. 1108), 112 Stat. 2061; 25
U.S.C. 1647b.
0
2. Section 890.114 is amended by revising paragraph (a) to read as
follows:
Sec. 890.114 Surprise billing.
(a) A carrier must comply with requirements described in 26 CFR
54.9816-3, 54.9816-3T through 54.9816-6T, 54.9816-6A, 54.9816-6,
54.9816-8T, 54.9816-8, 54.9817-1T, 54.9817-2, 54.9817-2T, 54.9822-1T,
and 54.9825-3T through 6T; 29 CFR 2590.716-3 through 2590.716-6,
2590.716-6A, 2590.716-8, 2590.717-1, 2590.717-2, 2590.722, 2590.725-1
through 2590.725-4; and 45 CFR 149.30, 149.100, 149.110 through
149.140, 149.310, 149.510 through 530, and 149.710 through 149.740 in
the same manner as such provisions apply to a group health plan or
health insurance issuer offering group or individual health insurance
coverage, subject to 5 U.S.C. 8902(m)(1), and the provisions of the
carrier's contract. For purposes of application of such sections, all
carriers are deemed to offer health benefits in the large group market.
* * * * *
DEPARTMENT OF THE TREASURY
INTERNAL REVENUE SERVICE
Accordingly, the Treasury Department and the IRS propose to amend
26 CFR part 54 as follows:
PART 54--PENSION EXCISE TAXES
0
3. The authority citation for part 54 is amended by adding entries for
Sec. Sec. 54.9816-3, 54.9816-6A and 54.9816-9 in numerical order to
read in part as follows:
Authority: 26 U.S.C. 7805 * * *
* * * * *
Section 54.9816-3 also issued under 26 U.S.C. 9816.
Section 54.9816-6A also issued under 26 U.S.C. 9816.
Section 54.9816-9 also issued under 26 U.S.C. 9816.
* * * * *
0
4. Section 54.9816-3 is added to read as follows:
Sec. 54.9816-3 Definitions.
(a) The definitions in Sec. 54.9801-2 apply to Sec. Sec. 54.9816-
4 through 54.9816-9, 54.9817-1, 54.9817-2, and 54.9822-1, unless
otherwise specified. In addition, for purposes of Sec. Sec. 54.9816-4
through 54.9816-9, 54.9817-1, 54.9817-2, and 54.9822-1, the following
definition applies:
Bundled payment arrangement means an arrangement under which--
(1) A provider, facility, or provider of air ambulance services
bills for multiple items and/or services furnished to a single patient
under a single service code that represents multiple items or services
(for example, a Diagnosis-Related Group (DRG) code); or
(2) A plan or issuer makes an initial payment or notice of denial
of payment to a provider, facility, or provider of air ambulance
services under a single service code that represents multiple items or
services furnished to a single patient (for example, a DRG code).
(b) For further guidance, see Sec. 54.9816-3T.
0
5. Section 54.9816-3T is amended by--
0
a. Revising the introductory text; and
[[Page 75852]]
0
b. Adding the definition of ``Bundled payment arrangement'' in
alphabetical order.
The revisions and additions read as follows:
Sec. 54.9816-3T Definitions (temporary).
For further guidance, see Sec. 54.9816-3 introductory text;
* * * * *
Bundled payment arrangement has the meaning given in Sec. 54.9816-
3(a).
* * * * *
0
6. Section 54.9816-6A is added to read as follows:
Sec. 54.9816-6A Use of Claim Adjustment Reason Codes and Remittance
Advice Remark Codes.
(a) In general. When providing any paper or electronic remittance
advice to an entity that does not have a contractual relationship
directly or indirectly with a group health plan or a health insurance
issuer offering group or individual health insurance coverage with
respect to the furnishing of the item or service under the plan or
coverage in response to a claim for payment for health care items and
services furnished by that entity, the plan or issuer must use claim
adjustment reason codes (CARCs) and remittance advice remark codes
(RARCs) (see 45 CFR 162.1602 and 162.1603) as specified in guidance
issued by the Secretaries of the Treasury, Labor, and Health and Human
Services, or as required under any applicable adopted standards and
operating rules under 45 CFR part 162, to communicate information
related to whether the claim is or is not subject to the provisions of
this part and 45 CFR part 149, subpart E.
(b) Severability. (1) Any provision of this section held to be
invalid or unenforceable by its terms, or as applied to any person or
circumstance, shall be construed so as to continue to give maximum
effect to the provision permitted by law, unless such holding shall be
one of utter invalidity or unenforceability, in which event the
provision shall be severable from this section and shall not affect the
remainder thereof or the application of the provision to persons not
similarly situated or to dissimilar circumstances.
(2) The provisions in Sec. 54.9816-6A are intended to be severable
from the provisions in Sec. Sec. 54.9816-6, 54.9816-6T, 54.9816-8,
54.9816-8T, and 54.9816-9, from any grant of forbearance from removal
resulting from this subpart, and from any provision referenced in
Sec. Sec. 54.9816-6, 54.9816-6T, 54.9816-8, 54.9816-8T, and 54.9816-9.
0
7. Section 54.9816-6 is amended by adding a heading to paragraph (a),
revising paragraphs (b), (c), and (d) and adding paragraph (h) to read
as follows:
Sec. 54.9816-6 Methodology for calculating qualifying payment amount.
(a) Definitions. * * *
(b) Methodology for calculation of median contracted rate. For
further guidance, see Sec. 54.9816-6T(b).
(c) Methodology for calculation of the qualifying payment amount.
For further guidance, see Sec. 54.9816-6T(c).
(d) Information to be shared about the qualifying payment amount.
In cases in which the recognized amount, with respect to an item or
service furnished by a nonparticipating provider or nonparticipating
emergency facility, is the qualifying payment amount or the amount
billed by the provider or facility, or if the amount on which cost
sharing is based with respect to air ambulance services furnished by a
nonparticipating provider of air ambulance services is the qualifying
payment amount or the amount billed by the provider of air ambulance
services, the plan must provide to the provider, facility, or provider
of air ambulance services, as applicable, in writing, in paper or
electronic form--
(1) With an initial payment or notice of denial of payment under
Sec. 54.9816-4, Sec. 54.9816-4T, Sec. 54.9816-5, Sec. 54.9816-5T,
Sec. 54.9817 or Sec. 54.9817-T:
(i) For further guidance, see Sec. 54.9816-6T(d)(i);
(ii) If the qualifying payment amount is based on a downcoded
service code or modifier--
(A) A statement that the service code or modifier billed by the
provider, facility, or provider of air ambulance services was
downcoded;
(B) An explanation of why the claim was downcoded, which must
include a description of which service codes were altered, if any, and
a description of which modifiers were altered, added, or removed, if
any; and
(C) The amount that would have been the qualifying payment amount
had the service code or modifier not been downcoded.
(iii) For further guidance, see Sec. 54.9816-6T(d)(1)(iii);
(iv) A statement that--
(A) If the provider, facility, or provider of air ambulance
services, as applicable, wishes to initiate a 30-business-day open
negotiation period for purposes of determining the out-of-network rate,
the provider, facility, or provider of air ambulance services must:
(1) Contact the appropriate person or office to initiate open
negotiation within 30 business days of receiving the initial payment or
notice of denial of payment, and
(2) For disclosures required to be provided on or after [DATE 90
DAYS AFTER PUBLICATION OF FINAL REGULATIONS IN THE FEDERAL REGISTER]
and once the open negotiation notice can be submitted through the
Federal IDR portal, notify the Secretary as described under Sec.
54.9816-8(b)(1)(i); and
(B) If the 30-business-day open negotiation period does not result
in an agreement on the amount of payment the provider, facility, or
provider of air ambulance services may generally initiate the Federal
IDR process within 4 business days after the end of the open
negotiation period;
(v) For disclosures required to be provided on or after [DATE 90
DAYS AFTER PUBLICATION OF FINAL REGULATIONS IN THE FEDERAL REGISTER],
the legal business name of the group health plan (if any), the legal
business name of the plan sponsor (if applicable), and the registration
number assigned under Sec. 54.9816-9, if the plan is registered under
Sec. 54.9816-9.
(vi) For further guidance, see Sec. 54.9816-6T(d)(1)(vi);
(2) In a timely manner upon request of the provider, facility, or
provider of air ambulance services:
(i) For further guidance, see Sec. 54.9816-6T(d)(2)(i) through
(iv)
(ii) [Reserved]
* * * * *
(h) Severability. (1) Any provision of this section held to be
invalid or unenforceable by its terms, or as applied to any person or
circumstance, shall be construed so as to continue to give maximum
effect to the provision permitted by law, unless such holding shall be
one of utter invalidity or unenforceability, in which event the
provision shall be severable from this section and shall not affect the
remainder thereof or the application of the provision to persons not
similarly situated or to dissimilar circumstances.
(2) The provisions in Sec. 54.9816-6 are intended to be severable
from the provisions in Sec. Sec. 54.9816-6A, 54.9816-6T, 54.9816-8,
54.9816-8T, and 54.9816-9, from any grant of forbearance from removal
resulting from this subpart, and from any provision referenced in
Sec. Sec. 54.9816-6A, 54.9816-8, 54.9816-8T, and 54.9816-9.
0
8. Section 54.9816-6T is amended by:
0
a. Revising paragraphs (d) introductory text, (d)(1)(iv) and (v);
0
b. Adding paragraph (d)(1)(vi);
0
c. Revising paragraph (d)(2) introductory text; and
0
d. Adding paragraph (h).
[[Page 75853]]
The additions read as follows:
Sec. 54.9816-6T Methodology for calculating qualifying payment amount
(temporary).
* * * * *
(d) For further guidance, see Sec. 54.9816-6(d) introductory text;
(1) * * *
(iv) For further guidance, see Sec. 54.9816-6(d)(1)(iv); and
(v) For further guidance, see Sec. 54.9816-6(d)(1)(v);
(vi) Contact information, including a telephone number and email
address, for the appropriate person or office to initiate open
negotiations for purposes of determining an amount of payment
(including cost sharing) for such item or service.
(2) For further information see Sec. 54.9816-6(d)(2):
* * * * *
(h) Severability. For further guidance, see Sec. 54.9816-6(h).
0
9. Section 54.9816-8 is amended by revising paragraphs (a), (b), (c),
(d), (e), (g), and (h), and adding paragraph (i) to read as follows:
The revisions and additions read as follows:
Sec. 54.9816-8 Independent dispute resolution process.
(a) Scope and definitions--(1) Scope. For further guidance, see
Sec. 54.9816-8T(a)(1).
(2) Definitions. For further guidance, see Sec. 54.9816-8T(a)(2).
Additionally, for purposes of this section, the following definitions
apply:
(i) Batched qualified IDR items and services means multiple
qualified IDR items or services that are considered jointly as part of
one payment determination by a certified IDR entity for purposes of the
Federal IDR process in accordance with paragraph (c)(4) of this
section.
(ii) For further guidance, see Sec. 54.9816-8T(a)(2)(ii)-(xii).
(b) Determination of payment amount through open negotiation and
the initiation of the Federal IDR process--(1) Determination of payment
amount through open negotiation--(i) In general. With respect to an
item or service that meets the requirements of Sec. 54.9816-
8T(a)(2)(xi)(A), the provider, facility, or provider of air ambulance
services, or the group health plan or health insurance issuer offering
group or individual health insurance coverage may, during the 30-
business-day period beginning on the day the provider, facility, or
provider of air ambulance services receives an initial payment or
notice of denial of payment regarding the item or service, initiate an
open negotiation period for purposes of determining the out-of-network
rate for such item or service. To initiate the open negotiation period,
a party must submit a written open negotiation notice with the content
specified in paragraph (b)(1)(ii) of this section to the other party
and to the Secretary in the manner specified in paragraph (b)(3) of
this section. The 30-business-day open negotiation period begins on the
day on which the party first submits the open negotiation notice and
the remittance advice documentation specified in paragraph
(b)(1)(ii)(A)(12) of this section to the other party and the Secretary.
The party in receipt of the open negotiation notice must provide to the
other party and to the Secretary in the manner specified in paragraph
(b)(3) of this section as soon as practicable, but no later than the
15th business day of the 30-business-day open negotiation period, a
written notice and supporting documentation in response to the open
negotiation notice, as specified in paragraph (b)(1)(iii)(A) of this
section.
(ii) Open negotiation notice--(A) Content. The open negotiation
notice must include, with respect to the item or service that is the
subject of the open negotiation notice, information about the item or
service and the parties including:
(1) Information sufficient to identify the provider, facility, or
provider of air ambulance services, including the name and current
contact information (including the legal business name, email address,
phone number, and mailing address) as provided with the claim form
submitted by the provider, facility, or air ambulance provider to the
plan or issuer, and the National Provider Identifier (NPI);
(2) Information sufficient to identify the plan or issuer,
including the plan's or issuer's registration number, as required under
Sec. 54.9816-9, if the plan or issuer is registered under Sec.
54.9816-9, or an attestation from the party submitting the open
negotiation notice that the plan or issuer was not registered prior to
the date it submitted the notice; the legal business name of the plan
or issuer, as well as the current contact information (name, email
address, phone number, and mailing address) of the plan or issuer as
provided with the initial payment or notice of denial of payment; and
if the party submitting the open negotiation notice is a plan or
issuer, the plan type (for example, self-insured or fully-insured);
(3) The name and contact information (including the legal business
name, email address, phone number, and mailing address) for any third
party representing the party submitting the open negotiation notice,
and an attestation that the third party has the authority to act on
behalf of the party it represents in the open negotiation;
(4) Information sufficient to identify the item or service,
including: the date(s) the item or service was furnished and, if the
party submitting the open negotiation notice is a provider, facility,
or provider of air ambulance services, the date(s) that the provider,
facility, or provider of air ambulance services received the initial
payment or notice of denial of payment for the item or service from the
plan or issuer; the type of item or service (specifically, whether the
item or service is an emergency service as defined in Sec. 54.9816-
4T(c)(2)(i) or (ii), a non-emergency service as described in Sec.
54.9816-5T(b), or an air ambulance service as defined in Sec. 54.9816-
3T); whether the service is a professional service or facility-based
service; the State where the item or service was furnished; the claim
number; the service code; and information to identify the location
where the item or service was furnished (such as, place of service code
or bill type code);
(5) The initial payment amount (including $0 if, for example,
payment is denied);
(6) The qualifying payment amount, if provided with the initial
payment or notice of denial of payment or if the party submitting the
open negotiation notice is a plan or issuer;
(7) An offer of an out-of-network rate for each item or service;
(8) If the party submitting the open negotiation notice is a plan
or issuer, the amount of cost sharing imposed for the item or service,
if any;
(9) If the party submitting the open negotiation notice is a
provider or facility, a statement that the items and services do not
qualify for the notice and consent exception described at 45 CFR
149.410(b) or Sec. 149.420(c) through (i);
(10) A statement that the provider, facility, or provider of air
ambulance services was a nonparticipating provider, nonparticipating
emergency facility, or nonparticipating provider of air ambulance
services on the date the item or service was furnished;
(11) General information listed in the standard open negotiation
notice developed by the Secretary pursuant to paragraph (b)(3) of this
section describing the open negotiation period and the Federal IDR
process (including a description of the purpose of the open negotiation
period and Federal IDR process and key deadlines in the open
negotiation period and Federal IDR process); and
[[Page 75854]]
(12) A copy of the initial payment or notice of denial of payment
or other remittance advice that is required to include the disclosures
under Sec. Sec. 54.9816-6T(d)(1) and 54.9816-6(d)(1), with respect to
the item or service.
(B) [Reserved]
(iii) Open negotiation response notice--(A) Content. The response
to the open negotiation notice must include, with respect to the item
or service that is the subject of the open negotiation response notice,
information about the item or service and the parties including:
(1) Information sufficient to identify the provider, facility, or
provider of air ambulance services, including the name and current
contact information (including the legal business name, email address,
phone number, and mailing address) as provided with the claim form
submitted by the provider, facility, or provider of air ambulance
services to the plan or issuer, and the NPI;
(2) Information sufficient to identify the plan or issuer,
including the plan's or issuer's registration number, as required under
Sec. 54.9816-9 if the plan or issuer is registered under Sec.
54.9816-9, or an attestation from the party submitting the open
negotiation response notice that the plan or issuer was not registered
prior to the date it submitted the notice; the legal business name of
the plan or issuer, as well as the current contact information (name,
email address, phone number, and mailing address) of the plan or issuer
as provided with the initial payment or notice of denial of payment;
and if the party submitting the open negotiation response notice is a
plan or issuer, the plan type (for example, self-insured or fully-
insured);
(3) The name and contact information (including the legal business
name, email address, phone number, and mailing address) for any third
party representing the party submitting the open negotiation response
notice, and an attestation that the third party has the authority to
act on behalf of the party it represents in the open negotiation;
(4) Information sufficient to identify the item or service included
in the open negotiation notice, including the date(s) the item or
service was furnished, and if the party submitting the open negotiation
response notice is a provider, facility, or provider of air ambulance
services, the date(s) that the provider, facility, or provider of air
ambulance services received the initial payment or notice of denial of
payment for such item or service from the plan or issuer, and the claim
number;
(5) If the party submitting the open negotiation response notice is
a plan or issuer, a statement as to whether it agrees that the initial
payment amount (including $0 if, for example, payment is denied) and
the qualifying payment amount reflected in the open negotiation notice
accurately reflect the initial payment amount and qualifying payment
amount disclosed with the initial payment for the item or service, and
if not, or if the open negotiation notice indicates that the qualifying
payment amount was not communicated by the plan or issuer with the
initial payment or notice of denial of payment or other remittance
advice, the initial payment amount (including $0 if, for example,
payment is denied) and/or qualifying payment amount it believes to be
correct, and documentation to support the statement (for example, the
remittance advice confirming the qualifying payment amount);
(6) If the party submitting the open negotiation response notice is
a plan or issuer, the amount of cost sharing imposed for the item or
service, if any;
(7) A counteroffer for an out-of-network rate for each item or
service or an acceptance of the other party's offer;
(8) If the party submitting the open negotiation response notice is
a provider or facility, a statement that the items and services do not
qualify for the notice and consent exception described at 45 CFR
149.410(b) or 45 CFR 149.420(c) through (i);
(9) With respect to each item or service, either a statement and
supporting documentation that explains why the item or service is not
subject to the Federal IDR process or a statement agreeing that the
item or service is subject to the Federal IDR process;
(10) A statement as to whether any of the information provided in
the open negotiation notice is inaccurate and the basis for the
statement, as well as supporting documentation; and
(11) A statement confirming that the initial payment or notice of
denial of payment or other remittance advice provided by the party
submitting the open negotiation notice under paragraph
(b)(1)(ii)(A)(12) of this section is accurate, and if inaccurate, a
copy of the accurate initial payment or notice of denial of payment or
other remittance advice required to include the disclosures under Sec.
54.9816-6(d)(1) and Sec. 54.9816-6T(d)(1), with respect to the item or
service.
(B) [Reserved]
(2) Initiating the Federal IDR process--(i) In general. Either
party may initiate the Federal IDR process with respect to a qualified
IDR item or service for which the parties do not agree upon an out-of-
network rate by the last day of the open negotiation period provided
for under paragraph (b)(1) of this section. To initiate the Federal IDR
process, a party (the initiating party) must submit a written notice of
IDR initiation, consistent with paragraph (b)(2)(ii) of this section,
to the other party to the dispute (the non-initiating party), and to
the Secretary in the manner specified in paragraph (b)(3) of this
section, during the 4-business-day period beginning on the first
business day after the last day of the open negotiation period (unless
it is otherwise required to be submitted in the timeframe specified in
paragraph (c)(5)(vii)(C) of this section). The date of IDR initiation
is the date that the Secretary receives the notice of IDR initiation
described in paragraph (b)(2)(ii) of this section.
(A) Exception for items and services provided by certain
nonparticipating providers and facilities. A party may not initiate the
Federal IDR process with respect to an item or service if, with respect
to that item or service, the party knows (or reasonably should have
known) that the provider or facility provided notice and received
consent under 45 CFR 149.410(b) or 149.420(c) through (i).
(B) [Reserved]
(ii) Notice of IDR initiation--(A) Content. The notice of IDR
initiation must include, with respect to the item or service that is
the subject of the notice, information about the item or service and
the parties including:
(1) Information sufficient to identify the provider, facility, or
provider of air ambulance services, including the name and current
contact information (including the legal business name, email address,
phone number, and mailing address), and the NPI; and if the initiating
party is a provider, facility, or provider of air ambulance services,
the Tax Identification Number (TIN);
(2) Information sufficient to identify the plan or issuer,
including the plan's or issuer's registration number, as required under
Sec. 54.9816-9 if the plan or issuer is registered under Sec.
54.9816-9, or an attestation from the initiating party that the plan or
issuer was not registered prior to the date that it submitted the
notice; the legal business name of the plan or issuer, as well as the
current contact information (name, email address, phone number, and
mailing address) of the plan or issuer as provided with the initial
payment or notice of denial of payment; and if the initiating party is
a plan or issuer, the
[[Page 75855]]
plan type (for example, self-insured or fully-insured) and TIN (or, in
the case of a plan that does not have a TIN, the TIN of the plan
sponsor);
(3) The name and contact information (including the legal business
name, email address, phone number, and mailing address) for any third
party representing the initiating party, and an attestation that the
third party has the authority to act on behalf of the party it
represents in the Federal IDR process;
(4) Information sufficient to identify whether the dispute being
initiated includes batched or bundled qualified IDR items or services
as described in paragraph (c)(4) of this section;
(5) Information sufficient to identify the qualified IDR item or
service that is the subject of the notice of IDR initiation, including
the date(s) the qualified IDR item or service was furnished; if the
initiating party is a provider, facility, or provider of air ambulance
services, the date(s) that the provider, facility, or provider of air
ambulance services received the initial payment or notice of denial of
payment for such item or service from the plan or issuer; the date the
open negotiation period under paragraph (b)(1) of this section began;
the type of item or service (specifically, whether the qualified IDR
item or service is an emergency service as defined in Sec. 54.9816-
4T(c)(2)(i) or (ii), a non-emergency service as described in Sec.
54.9816-5T(b), or an air ambulance service as defined in Sec. 54.9816-
3T); whether the service is a professional service or facility-based
service; the State where the item or service was furnished; the claim
number; the service code; and information to identify the location the
item or service was furnished (including place of service code or bill
type code);
(6) The initial payment amount (including $0 if, for example,
payment is denied);
(7) The qualifying payment amount, if provided with the initial
payment or notice of denial of payment or if the initiating party is a
plan or issuer;
(8) If the initiating party is a provider or facility, a statement
that the items and services do not qualify for the notice and consent
exception described at 45 CFR 149.410(b) or 45 CFR 149.420(c) through
(i);
(9) A statement that the provider, facility, or provider of air
ambulance services was a nonparticipating provider, nonparticipating
emergency facility, or nonparticipating provider of air ambulance
services on the date the item or service was furnished;
(10) Attestation that the item or service under dispute is a
qualified IDR item or service, and the basis for the attestation;
(11) General information listed in the standard notice of IDR
initiation developed by the Secretary pursuant to paragraph (b)(3) of
this section describing the Federal IDR process (including a
description of the purpose of the Federal IDR process and key deadlines
in the Federal IDR process);
(12) A copy of the initial payment or notice of denial of payment
or other remittance advice that is required to include the disclosures
under Sec. 54.9816-6(d)(1) and Sec. 54.9816-6T(d)(1), with respect to
the item or service;
(13) Preferred certified IDR entity; and
(14) A statement describing the key aspects of the claim, such as
patient acuity or level of training of the provider, facility, or
provider of air ambulance services that furnished the qualified IDR
item or service, discussed by the parties during open negotiation that
relate to the payment for the disputed claim, whether the reasons for
initiating the Federal IDR process are different from the aspects of
the claim discussed during the open negotiation period, and an
explanation of why the party is initiating the Federal IDR process,
including any of the permissible considerations described in paragraph
(c)(5)(iii) of this section and Sec. 54.9817-2(b)(2) that serve as the
party's basis for initiating the Federal IDR process.
(B) [Reserved]
(iii) Notice of IDR initiation response. -The non-initiating party
must provide to the initiating party and to the Secretary in the manner
specified in paragraph (b)(3) of this section within 3 business days
after the date of IDR initiation, a written notice and supporting
documentation in response to the notice of IDR initiation, as specified
in paragraph (b)(2)(iii)(A) of this section.
(A) Content. The notice of IDR initiation response must include,
with respect to the item or service that is the subject of the notice,
information about the item or service and the parties including:
(1) Information sufficient to identify the provider, facility, or
provider of air ambulance services, including the name and current
contact information (including the legal business name, email address,
phone number, and mailing address), and the NPI; and if the non-
initiating party is a provider, facility, or provider of air ambulance
services, the TIN;
(2) Information sufficient to identify the plan or issuer,
including the plan's or issuer's registration number, as required under
Sec. 54.9816-9 if the plan or issuer is registered under Sec.
54.9816-9 or an attestation from the non-initiating party that the plan
or issuer was not registered prior to the date that it submitted the
notice; the legal business name of the plan or issuer, as well as the
current contact information (name, email address, phone number, and
mailing address) of the plan or issuer as provided with the initial
payment or notice of denial of payment; and if the non-initiating party
is a plan or issuer, the plan type (for example, self-insured or fully-
insured) and TIN (or, in the case of a plan that does not have a TIN,
the TIN of the plan sponsor);
(3) The name and contact information (including the legal business
name, email address, phone number, and mailing address) for any third
party representing the non-initiating party, and an attestation that
the third party has the authority to act on behalf of the party it
represents in the Federal IDR process;
(4) Information sufficient to identify each item or service
included in the notice of IDR initiation, including the date(s) the
item or service was furnished. If the non-initiating party is a
provider, facility, or provider of air ambulance services, the date(s)
that the provider, facility, or provider of air ambulance services
received the initial payment or notice of denial of payment for such
item or service from the plan or issuer, and the claim number;
(5) If the non-initiating party is a plan or issuer, a statement as
to whether the non-initiating party agrees that the initial payment
(including $0 if, for example, payment is denied) and the qualifying
payment amount reflected in the notice of IDR initiation are accurate
for the item or service that is the subject of the dispute, and if not,
the initial payment amount (including $0 if, for example, payment is
denied) and/or qualifying payment amount it believes to be correct, and
documentation to support the statement (for example, the remittance
advice confirming the qualifying payment amount);
(6) If the non-initiating party is a plan or issuer, the amount of
cost sharing imposed for the item or service, if any;
(7) If the non-initiating party is a provider or facility, a
statement that the items and services do not qualify for the notice and
consent exception described at 45 CFR 149.410(b) or 45 CFR 149.420(c)
through (i);
(8) With respect to each item or service that is the subject of the
dispute, either an attestation that the item or service is a qualified
IDR item or service, or, for each item or service that
[[Page 75856]]
the non-initiating party asserts is not a qualified IDR item or
service, an explanation and documentation to support the statement;
(9) A statement confirming that the initial payment or notice of
denial of payment or other remittance advice provided by the initiating
party under paragraph (b)(2)(ii)(A)(12) of this section is accurate,
and if inaccurate, a copy of the accurate initial payment or notice of
denial of payment or other remittance advice required to include the
disclosures under Sec. Sec. 54.9816-6(d)(1) and 54.9816-6T(d)(1), with
respect to the item or service;
(10) A statement as to whether any of the information provided in
the notice of IDR initiation is inaccurate and the basis for the
statement as well as any supporting documentation; and
(11) A statement as to whether the non-initiating party agrees or
objects to the initiating party's preferred certified IDR entity. If
the non-initiating party objects to the initiating party's preferred
certified IDR entity, the notice of IDR initiation response must
include the name of an alternative preferred certified IDR entity and,
if applicable, an explanation of any conflict of interest with the
initiating party's preferred certified IDR entity .
(B) [Reserved].
(3) Manner. A party furnishing notices as required under paragraphs
(b)(1)(ii) and (iii), and (b)(2)(ii) and (iii) of this section must
furnish the notices using the standard forms developed by the Secretary
and must furnish the notices and supporting documentation to the other
party and the Secretary, through the Federal IDR portal.
(c) Federal IDR process following initiation--(1) Selection of
certified IDR entity--(i) Preliminary selection of the certified IDR
entity. Within 3 business days after the date of IDR initiation, the
non-initiating party must agree or object to the preferred certified
IDR entity identified in the notice of IDR initiation, as described in
paragraph (b)(2)(iii)(A)(11) of this section.
(A) If the non-initiating party agrees, or fails to object, to the
selection of the initiating party's preferred certified IDR entity in
the manner described in paragraph (b)(2)(iii)(A)(11) of this section
and within the timeframe specified in paragraph (c)(1)(i) of this
section, the initiating party's preferred certified IDR entity will be
considered jointly selected on the third business day after the date of
IDR initiation.
(B) If the non-initiating party objects to the selection of the
initiating party's preferred certified IDR entity by designating an
alternative preferred certified IDR entity in the manner described in
paragraph (b)(2)(iii)(A)(11) of this section and within 3 business days
after the date of IDR initiation, the initiating party may then agree
or object to the non-initiating party's alternative preferred certified
IDR entity by submitting the notice of certified IDR entity selection
in the manner specified in paragraph (c)(1)(i)(D) of this section. If
the initiating party agrees to the non-initiating party's alternative
preferred certified IDR entity within 3 business days after the date of
IDR initiation, or if the non-initiating party submits the notice of
IDR initiation response on or before the second business day after the
date of IDR initiation and the initiating party fails to respond within
3 business days after the date of IDR initiation, the alternative
preferred certified IDR entity will be considered jointly selected by
the parties. If the non-initiating party submits the notice of IDR
initiation response on the third business day after the date of IDR
initiation and the initiating party does not agree on the same day,
selection will proceed under paragraph (c)(1)(i)(C) of this section.
(C) If a certified IDR entity is not jointly selected under
paragraph (c)(1)(i)(A) or (B) of this section, either party may select
an alternative preferred certified IDR entity by submitting the notice
of certified IDR entity selection in the manner specified in paragraph
(c)(1)(i)(D) of this section, until the earlier of the date that the
parties agree on the alternative preferred certified IDR entity or the
deadline for joint selection, which is 3 business days after the date
of IDR initiation. Once a party submits a notice of certified IDR
entity selection, it may not submit another notice of certified IDR
entity selection until after it receives a responding notice of
certified IDR entity selection from the other party.
(1) If a party submits a notice of certified IDR entity selection
to the other party on the first or second day after the date of IDR
initiation and the party in receipt of the notice agrees or fails to
object to the alternative preferred certified IDR entity by the third
business day after the date of IDR initiation, the alternative
preferred certified IDR entity will be considered jointly selected by
the parties.
(2) If a party submits a notice of certified IDR entity selection
to the other party on the third business day after the date of IDR
initiation and the party last in receipt of the notice agrees to the
alternative preferred certified IDR entity on the same day, the
alternative preferred certified IDR entity will be considered jointly
selected by the parties.
(3) If a party submits a notice of certified IDR entity selection
to the other party on the third business day after the date of IDR
initiation and the party last in receipt of the notice does not agree
to the alternative preferred certified IDR entity on the same day, the
parties will have failed to jointly select a certified IDR entity.
(D) To notify the other party and the Secretary of an agreement or
objection to an alternative preferred certified IDR entity under
paragraph(c)(1)(i)(C) of this section, a party must submit the notice
of certified IDR entity selection. The party must furnish the notice of
certified IDR entity selection using the standard form developed by the
Secretary and must furnish the notice to the other party and the
Secretary through the Federal IDR portal within 3 business days after
the date of IDR initiation. However, in the event the conditions under
paragraph (c)(1)(ii) of this section apply, the party may notify the
Secretary of an agreement or objection to an alternative preferred
certified IDR entity in accordance with paragraph (c)(1)(ii) of this
section. The notice of certified IDR entity selection must include a
statement indicating the party's agreement with or objection to the
other party's alternative preferred certified IDR entity and, if
applicable, an explanation of any conflict of interest with the
alternative preferred certified IDR entity. If the party in receipt of
a notice of certified IDR entity selection objects to the other party's
alternative preferred certified IDR entity and the party submits a
notice of certified IDR entity selection by the end of the third
business day after the date of IDR initiation, that party's notice of
certified IDR entity selection reflecting the objection must include
the name of another alternative preferred certified IDR entity.
(ii) Failure to jointly select a certified IDR entity. If the
parties fail to jointly select a certified IDR entity within 3 business
days after the date of IDR initiation, the Secretary will select a
certified IDR entity. The parties will have failed to jointly select a
certified IDR entity if, by the end of the third business day after the
date of IDR initiation, the party last in receipt of the notice of IDR
initiation response or the notice of certified IDR entity selection has
objected to the other party's alternative preferred certified IDR
entity, or if the notice of IDR initiation response or the notice of
certified IDR entity selection is submitted to the other party on the
third business day after the date of IDR initiation and the party in
receipt of the notice does not agree to the alternative preferred
certified IDR
[[Page 75857]]
entity within 3 business days after the date of IDR initiation.
(A) In selecting the certified IDR entity, the Secretary will first
confirm whether a party submitted the notice of IDR initiation response
or the notice of certified IDR entity selection with an alternative
preferred certified IDR entity on the third business day after the date
of IDR initiation without the other party's agreement to the selection.
If either notice was provided on the third business day after the date
of IDR initiation without the other party's agreement to the
alternative preferred certified IDR entity by the end of third business
day after the date of IDR initiation, the Secretary will provide the
party last in receipt of the applicable notice 2 additional business
days to agree or object to the other party's alternative preferred
certified IDR entity selection.
(1) If the party last in receipt of the notice of IDR initiation
response or the notice of certified IDR entity selection agrees with
the other party's alternative preferred certified IDR entity and
notifies the Secretary of the agreement or fails to notify the
Secretary of its objection in the Federal IDR portal by the fifth
business day after the date of IDR initiation, the Secretary will
select the final alternative preferred certified IDR entity selected in
the applicable notice. In disputes where the applicable notice was
submitted on the third business day after the date of IDR initiation,
the party last in receipt of the notice will not be allowed to select
another alternative preferred certified IDR entity.
(2) If the party notifies the Secretary of its objection to the
alternative preferred certified IDR entity by the fifth business day
after the date of IDR initiation, the Secretary will proceed with the
random selection of the certified IDR entity from among the certified
IDR entities (other than the preferred certified IDR entity and any
alternative preferred certified IDR entity previously selected in such
dispute by a party, unless there is no other certified IDR entity
available to select) that charge a fee within the allowed range of
certified IDR entity fees on the sixth business day after the date of
IDR initiation. If there are insufficient certified IDR entities that
charge a fee within the allowed range of certified IDR entity fees
available to arbitrate the dispute, the Secretary will select a
certified IDR entity that has received approval, as described in Sec.
54.9816-8T(e)(2)(vii)(B), to charge a fee outside of the allowed range
of certified IDR entity fees. In either case, the Secretary will notify
the parties of the preliminary selection of the certified IDR entity
not later than 6 business days after the date of IDR initiation.
(B) [Reserved].
(iii) Date of preliminary selection of the certified IDR entity.
The date of preliminary selection of the certified IDR entity will be:
(A) Three business days after the date of IDR initiation if the
parties jointly selected a certified IDR entity, as specified in
paragraph (c)(1)(i) of this section; or
(B) Six business days after the date of IDR initiation, if the
parties fail to jointly select a certified IDR entity as specified in
paragraph (c)(1)(ii) of this section.
(iv) Final selection of certified IDR entity--(A) Conflict-of-
interest review. The certified IDR entity preliminarily selected for a
dispute must review the selection. The selection of the certified IDR
entity will be finalized only if the certified IDR entity attests to
the Secretary that it meets the following requirements:
(1) The certified IDR entity does not have a conflict of interest
as defined in Sec. 54.9816-8T(a)(2)(iv);
(2) The certified IDR entity will only assign personnel to a
dispute and make decisions regarding hiring, compensation, termination,
promotion, or other similar matters related to personnel assigned to
the dispute in a manner that is not based upon the likelihood that the
assigned personnel will support a particular party to the dispute; and
(3) The certified IDR entity will not assign any personnel to a
dispute who would have any conflicts of interest, as defined in Sec.
54.9816-8T(a)(2)(iv), regarding any party to the dispute or whose
relationship with a party within the 1 year immediately preceding the
assignment to the dispute would violate the restrictions on aiding or
advising a former employer or principal in a manner similar to the
restrictions set forth in 18 U.S.C. 207(b).
(B) Failure to meet conflict-of-interest requirements. If the
certified IDR entity notifies the Secretary within 3 business days of
the date of preliminary selection of the certified IDR entity that it
does not meet the requirements of paragraphs (c)(1)(iv)(A)(1) through
(3) of this section or if the certified IDR entity does not respond
within 3 business days after the date of preliminary selection of the
certified IDR entity, the Secretary will randomly select another
certified IDR entity consistent with paragraph (c)(1)(ii) of this
section. The Secretary will notify the parties of the new randomly
preliminarily selected certified IDR entity no later than 1 business
day after the previously selected certified IDR entity notifies the
Secretary that it has a conflict of interest or, if the previously
selected certified IDR entity fails to respond within 3 business days
after the date of preliminary selection of the certified IDR entity, no
later than 1 business day after the end of the 3-business-day period.
(C) Date of final selection of the certified IDR entity. If the
certified IDR entity that has been preliminarily selected attests
within 3 business days that it meets the requirements of paragraphs
(c)(1)(iv)(A)(1) through (3) of this section, the Secretary will notify
the parties of the final selection of the certified IDR entity no later
than 1 business day after the certified IDR entity attests that it
meets the conflict-of-interest requirements. The date of final
selection of the certified IDR entity is the date that the Secretary
provides this notice to the parties.
(2) Federal IDR process eligibility review--(i) Federal IDR process
eligibility determination by certified IDR entity. Unless the
departmental eligibility review described in paragraph (c)(2)(ii) of
this section applies, the selected certified IDR entity must review the
information in the notice of IDR initiation, notice of IDR initiation
response, and any additional information described in paragraph
(c)(2)(iii) of this section, and make a final determination as to
whether the item or service is a qualified IDR item or service, as
defined in Sec. 54.9816-8T(a)(2)(xi), that is eligible for the Federal
IDR process. The certified IDR entity must make such a determination
and notify the Secretary and both parties no later than 5 business days
after the date of final selection of the certified IDR entity. If the
certified IDR entity determines that the item or service is not a
qualified IDR item or service, the dispute will be closed, and the
selected certified IDR entity will not take any action with regard to
the dispute.
(ii) Departmental eligibility review for Federal IDR process
eligibility determinations. When the conditions for the departmental
eligibility review set forth in paragraph (c)(2)(ii)(A) of this section
are met, the Secretary will conduct the eligibility review and make the
eligibility determination instead of the certified IDR entity. If the
Secretary determines that the item or service is not a qualified IDR
item or service, the dispute will be closed, and the selected certified
IDR entity will not take any action with regard to the dispute. If the
dispute is found to be eligible, the Secretary will inform the
preliminarily
[[Page 75858]]
selected certified IDR entity of the dispute's eligibility so that it
may conduct its conflict-of-interest assessment, and the dispute will
otherwise continue through the Federal IDR process, including
notification of the eligibility determination to the disputing parties
by the preliminarily selected certified IDR entity.
(A) Application of the departmental eligibility review. The
departmental eligibility review will apply when the Secretary
determines that any of the extenuating circumstances described in
paragraph (g)(1) of this section require application of the
departmental eligibility review to facilitate timely payment
determinations or the effective processing of disputes under the
Federal IDR process.
(B) Notification regarding applicability of the departmental
eligibility review. Before invoking the application of the departmental
eligibility review, the Secretary will post advance public notification
of the date on which the departmental eligibility review will take
effect and the reasons for invoking the application of the departmental
eligibility review. Before ending the application of the departmental
eligibility review, the Secretary will post advance public notification
of the date on which the departmental eligibility review will no longer
be in effect and the reasons for ending the application of the
departmental eligibility review.
(iii) Request for additional information. The Secretary or the
selected certified IDR entity may request additional information from
either party to a dispute at any time, including for the purpose of
assessing whether a conflict of interest exists, conducting an
eligibility determination, or making a payment determination.
(A) Upon request, a party must submit the additional information
within 5 business days to the Secretary or the selected certified IDR
entity, as applicable, through the Federal IDR portal. Following a
request for additional information, the time period for the applicable
stage of the Federal IDR process will be tolled until the earlier of
the date either all of the requested information is provided or the 5-
business-day period expires, and each subsequent timeframe in the
Federal IDR process will be determined based on the date of completion
of the stage of the Federal IDR process that was tolled for provision
of the requested information.
(B) If a party fails to submit the additional information as
required, the related determination, including the eligibility
determination, conflict-of-interest review, or payment determination
will be made without the requested information unless a good-cause
extension of the 5-business-day period, as specified in paragraph
(g)(1)(i) of this section, has been provided, and the party
subsequently submits the additional information requested within the
extended period.
(3) Authority to continue negotiations or withdraw--(i) Authority
to continue to negotiate. If the parties to the Federal IDR process
agree on an out-of-network rate for a qualified IDR item or service
after providing the notice of IDR initiation to the Secretary required
under paragraph (b)(2)(ii) of this section, but before the certified
IDR entity has made its payment determination, the amount agreed to by
the parties for the qualified IDR item or service will be treated as
the out-of-network rate for the qualified IDR item or service. To the
extent the amount exceeds the initial payment amount and any cost
sharing paid or required to be paid by the participant, beneficiary, or
enrollee, or there was an initial denial of payment, payment must be
made directly by the plan or issuer to the nonparticipating provider,
nonparticipating facility, or nonparticipating provider of air
ambulance services not later than 30 business days after the agreement
is reached. In no instance may either party seek additional payment
from the participant, beneficiary, or enrollee, including in instances
in which the out-of-network rate exceeds the qualifying payment amount.
The initiating party must send a notification to the Secretary and to
the certified IDR entity (if selected) electronically, through the
Federal IDR portal, as soon as possible, but no later than 3 business
days after the date of the agreement. The notification must include the
dispute number, a statement of the out-of-network rate for the
qualified IDR item or service, and signatures from authorized
signatories for both parties.
(ii) Withdrawals. A dispute may be withdrawn from the Federal IDR
process by the initiating party, the Secretary, or a certified IDR
entity before a payment determination is made if one of the following
conditions is met:
(A) The initiating party provides notification through the Federal
IDR portal to the Secretary and the certified IDR entity (if selected)
that both parties to the dispute agree to withdraw the dispute from the
Federal IDR process without agreement on an out-of-network rate. The
notification must include the dispute number, a statement about both
parties' agreement to withdraw, and signatures from authorized
signatories for both parties.
(B) The initiating party provides a standard withdrawal request
notice through the Federal IDR portal to the Secretary, the certified
IDR entity (if selected), and the non-initiating party of its request
to withdraw the dispute from the Federal IDR process and the non-
initiating party notifies the Secretary, certified IDR entity (if
selected), and the initiating party through the Federal IDR portal of
its agreement to withdraw from the Federal IDR process within 5
business days of the initiating party's request. If the non-initiating
party fails to respond within 5 business days of the initiating party's
request, the non-initiating party will be considered to have agreed to
the withdrawal, and the dispute will be withdrawn.
(C) The certified IDR entity or Secretary cannot determine
eligibility because both parties to the dispute are unresponsive to any
requests for additional information to determine eligibility as
described in paragraph (c)(2)(iii) of this section, or
(D) The certified IDR entity cannot make a payment determination
because both parties to the dispute have failed to submit an offer as
described in paragraph (c)(5)(i) of this section.
(4) Treatment of batched qualified IDR items and services--(i) In
general. A certified IDR entity may consider up to 25 qualified IDR
items and services jointly as part of one payment determination that is
subject to the certified IDR entity fee for batched determinations only
if the qualified IDR items and services meet the requirements of this
paragraph (c)(4)(i).
(A) For further guidance, see Sec. 54.9816-8T(c)(4)(i)(A);
(B) Payment for the qualified IDR items and services is required to
be made by the same group health plan or health insurance issuer. For
group or individual health insurance coverage, this requirement is
satisfied if the same issuer is required to make payment for the
qualified IDR items and services, even if the qualified IDR items and
services relate to claims from different group health plans or
individual market policies. For self-insured group health plans, this
requirement is satisfied if the same self-insured group health plan is
required to make payment for the qualified IDR items and services,
including when the plan makes payments through a third party
administrator; the requirement is not satisfied if multiple self-
insured group health plans are required to make payments for the
qualified IDR items and services, even if those group health plans make
payments through the same third party administrator;
[[Page 75859]]
(C) The qualified IDR items and services meet any of the following
criteria under which multiple qualified IDR items and services relate
to the treatment of a similar condition and therefore are permitted to
be considered jointly as a single payment determination for purposes of
encouraging efficiencies (including minimizing costs) in the Federal
IDR process:
(1) The qualified IDR items or services were furnished to a single
patient during the same patient encounter. For purposes of this
section, a single patient encounter is defined as a patient encounter
on one or more consecutive days during which the qualified IDR items or
services were furnished to the same patient and billed on the same
claim form; or
(2) The qualified IDR items and services were furnished to one or
more patients and were billed under the same service code or a
comparable code under a different procedural coding system, such as
Current Procedural Terminology (CPT) codes with modifiers, if
applicable, Healthcare Common Procedure Coding System (HCPCS) codes
with modifiers, if applicable, or Diagnosis-Related Group (DRG) codes
with modifiers, if applicable; or
(3) For anesthesiology, radiology, pathology, and laboratory
qualified IDR items and services, the qualified IDR items and services
were furnished to one or more patients and were billed under service
codes belonging to the same Category I CPT code range, as specified in
guidance published by the Secretary; and
(D) All the qualified IDR items and services were furnished within
the same 30-business-day period following the date on which the first
item or service included in the batched determination was furnished and
were the subjects of a 30-business-day open negotiation period that
ended within 4 business days of IDR initiation, except as provided in
paragraph (c)(5)(vii) of this section.
(ii) Treatment of bundled payment arrangements. Qualified IDR items
and services that meet the definition of a bundled payment arrangement
under Sec. 54.9816-3 may be submitted and considered as a single
payment determination, and the certified IDR entity must make a single
payment determination for the multiple qualified IDR items and services
included in the bundled payment arrangement. Bundled payment
arrangements as defined in Sec. 54.9816-3 and submitted under this
paragraph (c)(4)(ii) are subject to the certified IDR entity fee for
single determinations.
(5) Payment determination for a qualified IDR item or service--(i)
Submission of offers. Not later than 10 business days after the date of
final selection of the certified IDR entity as described in paragraph
(c)(1)(iv)(C) of this section (or not later than 10 business days after
the qualified IDR items and services are determined eligible as
described in paragraph (c)(2) of this section, when the Secretary
determines that any of the extenuating circumstances described in
paragraph (g)(1)(ii) of this section apply), the plan or issuer and the
provider, facility, or provider of air ambulance services:
(A) For further guidance, see Sec. 54.9816-8T(c)(5)(i)(A).
(B) For further guidance, see Sec. 54.9816-8T(c)(5)(i)(B);
(ii) Payment determination and notification. Not later than 30
business days after the date of final selection of the certified IDR
entity as described in paragraph (c)(1)(iv)(C) of this section (or not
later than 30 business days after the qualified IDR items and services
are determined eligible as described in paragraph (c)(2) of this
section, when the Secretary determines that any of the extenuating
circumstances described in paragraph (g) of this section apply), the
certified IDR entity must:
(A) Select as the out-of-network rate for the qualified IDR item or
service one of the offers submitted under paragraph (c)(5)(i) of this
section, weighing only the considerations specified in paragraph
(c)(5)(iii) of this section (as applied to the information provided by
the parties pursuant to Sec. 54.9816-8T(c)(5)(i)). The certified IDR
entity must select the offer that the certified IDR entity determines
best represents the value of the qualified IDR item or service as the
out-of-network rate.
(1) Prevailing party. In the case of single determinations, the
party whose offer is selected by the certified IDR entity is considered
the prevailing party. In the case of batched determinations, the party
with the most determinations in its favor is considered the prevailing
party; if each party prevails in an equal number of determinations,
neither party will be considered the prevailing party, and the
certified IDR entity fee will be split evenly between the parties.
(2) Non-prevailing party. In the case of single determinations, the
party whose offer is not selected by the certified IDR entity is
considered the non-prevailing party. In the case of batched
determinations, the party with the fewest determinations in its favor
is considered the non-prevailing party.
(B) For further guidance, see Sec. 54.9816-8T(c)(5)(ii)(B).
(iii) Considerations in determination. In determining which offer
to select:
(A) The certified IDR entity must consider the qualifying payment
amount(s) for the applicable year for the same or similar item or
service.
(B) The certified IDR entity must then consider information
submitted by a party that relates to the following circumstances:
(1) The level of training, experience, and quality and outcomes
measurements of the provider or facility that furnished the qualified
IDR item or service (such as those endorsed by the consensus-based
entity authorized in section 1890 of the Social Security Act).
(2) The market share held by the provider or facility or that of
the plan or issuer in the geographic region in which the qualified IDR
item or service was provided.
(3) The acuity of the participant or beneficiary receiving the
qualified IDR item or service, or the complexity of furnishing the
qualified IDR item or service to the participant or beneficiary.
(4) The teaching status, case mix, and scope of services of the
facility that furnished the qualified IDR item or service, if
applicable.
(5) Demonstration of good faith efforts (or lack thereof) made by
the provider or facility or the plan or issuer to enter into network
agreements with each other, and, if applicable, contracted rates
between the provider or facility, as applicable, and the plan or
issuer, as applicable, during the previous 4 plan years.
(C) The certified IDR entity must also consider information
provided by a party in response to a request by the certified IDR
entity under Sec. 54.9816-8T(c)(4)(i)(A)(2) that relates to the offer
for the payment amount for the qualified IDR item or service that is
the subject of the payment determination and that does not include
information on factors described in Sec. 54.9816-8T(c)(4)(v).
(D) The certified IDR entity must also consider additional
information submitted by a party that relates to the offer for the
payment amount for the qualified IDR item or service that is the
subject of the payment determination and that does not include
information on factors described in Sec. 54.9816-8T(c)(4)(v).
(E) In weighing the considerations described in paragraphs
(c)(4)(iii)(B) through (D) of this section, the certified IDR entity
should evaluate whether the information is credible and relates to the
offer submitted by either party for the payment amount for the
qualified IDR
[[Page 75860]]
item or service that is the subject of the payment determination. The
certified IDR entity should not give weight to information to the
extent it is not credible, it does not relate to either party's offer
for the payment amount for the qualified IDR item or service, or it is
already accounted for by the qualifying payment amount under paragraph
(c)(4)(iii)(A) of this section or other credible information under
paragraphs (c)(4)(iii)(B) through (D) of this section.
(iv) Examples. The rules of paragraph (c)(4)(iii) of this section
are illustrated in the following paragraphs. Each example assumes that
the Federal IDR process applies for purposes of determining the out-of-
network rate, that both parties have submitted the information parties
are required to submit as part of the Federal IDR process, and that the
submitted information does not include information on factors described
in paragraph (c)(4)(v) of this section:
(A) Example 1--(1) Facts. A level 1 trauma center that is a
nonparticipating emergency facility and an issuer are parties to a
payment determination in the Federal IDR process. The facility submits
an offer that is higher than the qualifying payment amount. The
facility also submits additional written information showing that the
scope of services available at the facility was critical to the
delivery of care for the qualified IDR item or service provided, given
the particular patient's acuity. This information is determined to be
credible by the certified IDR entity. Further, the facility submits
additional information showing the contracted rates used to calculate
the qualifying payment amount for the qualified IDR item or service
were based on a level of service that is typical in cases in which the
services are delivered by a facility that is not a level 1 trauma
center and that does not have the capability to provide the scope of
services provided by a level 1 trauma center. This information is also
determined to be credible by the certified IDR entity. The issuer
submits an offer equal to the qualifying payment amount. No additional
information is submitted by either party. The certified IDR entity
determines that all the information submitted by the nonparticipating
emergency facility relates to the offer for the payment amount for the
qualified IDR item or service that is the subject of the payment
determination.
(2) Conclusion. In this paragraph (c)(4)(iv)(A) (Example 1), the
certified IDR entity must consider the qualifying payment amount. The
certified IDR entity then must consider the additional information
submitted by the nonparticipating emergency facility, provided the
information relates to circumstances described in paragraphs
(c)(4)(iii)(B) through (D) of this section and relates to the offer for
the payment amount for the qualified IDR item or service that is the
subject of the payment determination. If the certified IDR entity
determines that it is appropriate to give weight to the additional
credible information submitted by the nonparticipating emergency
facility and that the additional credible information submitted by the
facility demonstrates that the facility's offer best represents the
value of the qualified IDR item or service, the certified IDR entity
should select the facility's offer.
(B) Example 2--(1) Facts. A nonparticipating provider and an issuer
are parties to a payment determination in the Federal IDR process. The
provider submits an offer that is higher than the qualifying payment
amount. The provider also submits additional written information
regarding the level of training and experience the provider possesses.
This information is determined to be credible by the certified IDR
entity, but the certified IDR entity finds that the information does
not demonstrate that the provider's level of training and experience
relates to the offer for the payment amount for the qualified IDR item
or service that is the subject of the payment determination (for
example, the information does not show that the provider's level of
training and experience was necessary for providing the qualified IDR
service that is the subject of the payment determination to the
particular patient, or that the training or experience made an impact
on the care that was provided). The nonparticipating provider does not
submit any additional information. The issuer submits an offer equal to
the qualifying payment amount, with no additional information.
(2) Conclusion. In this paragraph (c)(4)(iv)(B) (Example 2), the
certified IDR entity must consider the qualifying payment amount. The
certified IDR entity must then consider the additional information
submitted by the nonparticipating provider, provided the information
relates to circumstances described in paragraphs (c)(4)(iii)(B) through
(D) of this section and relates to the offer for the payment amount for
the qualified IDR item or service that is the subject of the payment
determination. In addition, the certified IDR entity should not give
weight to information to the extent it is already accounted for by the
qualifying payment amount or other credible information under
paragraphs (c)(4)(iii)(B) through (D) of this section. If the certified
IDR entity determines that the additional information submitted by the
provider is credible but does not relate to the offer for the payment
amount for the qualified IDR service that is the subject of the payment
determination, and determines that the issuer's offer best represents
the value of the qualified IDR service, in the absence of any other
credible information that relates to either party's offer, the
certified IDR entity should select the issuer's offer.
(C) Example 3--(1) Facts. A nonparticipating provider and an issuer
are parties to a payment determination in the Federal IDR process
involving an emergency department visit for the evaluation and
management of a patient. The provider submits an offer that is higher
than the qualifying payment amount. The provider also submits
additional written information showing that the acuity of the patient's
condition and complexity of the qualified IDR service furnished
required the taking of a comprehensive history, a comprehensive
examination, and medical decision making of high complexity. This
information is determined to be credible by the certified IDR entity.
The issuer submits an offer equal to the qualifying payment amount for
CPT code 99285, which is the CPT code for an emergency department visit
for the evaluation and management of a patient requiring a
comprehensive history, a comprehensive examination, and medical
decision making of high complexity. The issuer also submits additional
written information showing that this CPT code accounts for the acuity
of the patient's condition. This information is determined to be
credible by the certified IDR entity. The certified IDR entity
determines that the information provided by the provider and issuer
relates to the offer for the payment amount for the qualified IDR
service that is the subject of the payment determination. Neither party
submits any additional information.
(2) Conclusion. In this paragraph (c)(4)(iv)(C) (Example 3), the
certified IDR entity must consider the qualifying payment amount. The
certified IDR entity then must consider the additional information
submitted by the parties, but the certified IDR entity should not give
weight to information to the extent it is already accounted for by the
qualifying payment amount or other credible information under
paragraphs (c)(4)(iii)(B) through (D) of this section. If the certified
IDR entity determines the additional information on the acuity of the
patient and complexity of the service is already accounted for in the
[[Page 75861]]
calculation of the qualifying payment amount, the certified IDR entity
should not give weight to the additional information provided by the
provider. If the certified IDR entity determines that the issuer's
offer best represents the value of the qualified IDR service, the
certified IDR entity should select the issuer's offer.
(D) Example 4--(1) Facts. A nonparticipating emergency facility and
an issuer are parties to a payment determination in the Federal IDR
process. Although the facility is not participating in the issuer's
network during the relevant plan year, it was a participating facility
in the issuer's network in the previous 4 plan years. The issuer
submits an offer that is higher than the qualifying payment amount and
that is equal to the facility's contracted rate (adjusted for
inflation) for the previous year with the issuer for the qualified IDR
service. The issuer also submits additional written information showing
that the contracted rates between the facility and the issuer during
the previous 4 plan years were higher than the qualifying payment
amount submitted by the issuer, and that these prior contracted rates
account for the case mix and scope of services typically furnished at
the nonparticipating facility. The certified IDR entity determines this
information is credible and that it relates to the offer submitted by
the issuer for the payment amount for the qualified IDR service that is
the subject of the payment determination. The facility submits an offer
that is higher than both the qualifying payment amount and the
contracted rate (adjusted for inflation) for the previous year with the
issuer for the qualified IDR service. The facility also submits
additional written information, with the intent to show that the case
mix and scope of services available at the facility were integral to
the service provided. The certified IDR entity determines this
information is credible and that it relates to the offer submitted by
the facility for the payment amount for the qualified IDR service that
is the subject of the payment determination. Neither party submits any
additional information.
(2) Conclusion. In this paragraph (c)(4)(iv)(D) (Example 4), the
certified IDR entity must consider the qualifying payment amount. The
certified IDR entity then must consider the additional information
submitted by the parties, but should not give weight to information to
the extent it is already accounted for by the qualifying payment amount
or other credible information under paragraphs (c)(4)(iii)(B) through
(D) of this section. If the certified IDR entity determines that the
information submitted by the facility regarding the case mix and scope
of services available at the facility includes information that is also
accounted for in the information the issuer submitted regarding prior
contracted rates, then the certified IDR entity should give weight to
that information only once. The certified IDR entity also should not
give weight to the same information provided by the nonparticipating
emergency facility in relation to any other factor. If the certified
IDR entity determines that the issuer's offer best represents the value
of the qualified IDR service, the certified IDR entity should select
the issuer's offer.
(E) Example 5--(1) Facts. A nonparticipating provider and an issuer
are parties to a payment determination in the Federal IDR process
regarding a qualified IDR service for which the issuer downcoded the
service code that the provider billed. The issuer submits an offer
equal to the qualifying payment amount (which was calculated using the
downcoded service code). The issuer also submits additional written
information that includes the documentation disclosed to the
nonparticipating provider under Sec. 54.9816-6(d)(1)(ii) at the time
of the initial payment (which describes why the service code was
downcoded). The certified IDR entity determines this information is
credible and that it relates to the offer for the payment amount for
the qualified IDR service that is the subject of the payment
determination. The provider submits an offer equal to the amount that
would have been the qualifying payment amount had the service code not
been downcoded. The provider also submits additional written
information that includes the documentation disclosed to the
nonparticipating provider under Sec. 54.9816-6(d)(1)(ii) at the time
of the initial payment. Further, the provider submits additional
written information that explains why the billed service code was more
appropriate than the downcoded service code, as evidence that the
provider's offer, which is equal to the amount the qualifying payment
amount would have been for the service code that the provider billed,
best represents the value of the service furnished, given its
complexity. The certified IDR entity determines this information to be
credible and that it relates to the offer for the payment amount for
the qualified IDR service that is the subject of the payment
determination. Neither party submits any additional information.
(2) Conclusion. In this paragraph (c)(4)(iv)(E) (Example 5), the
certified IDR entity must consider the qualifying payment amount, which
is based on the downcoded service code. The certified IDR entity then
must consider whether to give weight to additional information
submitted by the parties. If the certified IDR entity determines that
the additional credible information submitted by the provider
demonstrates that the nonparticipating provider's offer, which is equal
to the qualifying payment amount for the service code that the provider
billed, best represents the value of the qualified IDR service, the
certified IDR entity should select the nonparticipating provider's
offer.
(v) Prohibition on consideration of certain factors. For further
guidance, see Sec. 54.9816-8T(c)(5)(v).
(vi) Written Decision. For further guidance, see Sec. 54.9816-
8T(c)(5)(vi).
(vii) Effects of determination--(A) Binding. For further guidance
see Sec. 54.9816-8T(c)(5)(vii)(A).
(B) Suspension of certain subsequent IDR requests.--In the case of
a determination made by a certified IDR entity under paragraph
(c)(5)(ii) of this section, the party that submitted the initial
notification under paragraph (b)(2) of this section may not submit a
subsequent notification involving the same other party with respect to
a claim for the same item or service that was the subject of the
initial notification during the 90-calendar-day period following the
determination.
(C) Subsequent submission of requests permitted. If the end of the
open negotiation period specified in paragraph (b)(1) of this section
occurs during the 90-calendar-day suspension period regarding claims
for the same item or service that were the subject of the initial
notice of IDR determination as described in paragraph (c)(5)(vi) of
this section, either party may initiate the Federal IDR process for
those claims by submitting a notification as specified in paragraph
(b)(2) of this section during the 30-business-day period beginning on
the day after the last day of the 90-calendar-day suspension period.
(viii) Recordkeeping requirements. For further guidance see Sec.
54.9816-8T(c)(5)(viii).
(ix) Payment. For further guidance see Sec. 54.9816-8T(c)(5)(ix).
(d) Costs of IDR process--(1) Certified IDR entity fee--(i) Timing
of payment of certified IDR entity fee. Each party to a dispute for
which there is a final selection of the certified IDR entity and a
determination that the dispute is eligible for the Federal IDR process
in accordance with paragraph (c)(2) of this section must pay to the
certified IDR entity the predetermined certified IDR entity fee charged
by the certified IDR
[[Page 75862]]
entity. The certified IDR entity fee must be paid no later than the
date a party submits its offer to the certified IDR entity, in
accordance with paragraph (c)(5)(i) of this section.
(ii) Failure to timely pay certified IDR entity fee. If a party
fails to pay the certified IDR entity fee as specified in paragraph
(d)(1)(i) of this section, that party's offer will not be considered
received. Such party will continue to be responsible for payment of the
certified IDR entity fee.
(iii) Method of allocation of the certified IDR entity fee after a
payment determination. After making a payment determination, the
certified IDR entity shall retain the certified IDR entity fee
described under paragraph (d)(1)(i) of this section paid by the non-
prevailing party as defined in paragraph (c)(5)(ii)(A)(2) of this
section. The certified IDR entity must return the fee paid by the
prevailing party, as defined in paragraph (c)(5)(ii)(A)(1) of this
section, within 30 business days following the date of the certified
IDR entity's payment determination. In the event of a batched dispute
in which each party prevails in an equal number of determinations, the
certified IDR entity fee will be split evenly between the parties. In
that case, the certified IDR entity must return half the fee paid by
each party within 30 business days following the date of the certified
IDR entity's payment determination.
(iv) Method of allocation of the certified IDR entity fee upon
agreement or withdrawal after an eligibility determination. For a
dispute for which there is a final selection of the certified IDR
entity and a determination that the dispute is eligible for the Federal
IDR process in accordance with paragraph (c)(2) of this section, unless
directed otherwise by both parties, the certified IDR entity is
required to return half of each party's certified IDR entity fee within
30 business days of the date both parties notify the certified IDR
entity that they have:
(A) Reached an agreement on an out-of-network rate for qualified
IDR items or services before the certified IDR entity has made its
payment determination, as described in paragraph (c)(3)(i) of this
section; or
(B) Withdrawn the dispute before the certified IDR entity has made
its payment determination, as described in paragraph (c)(3)(ii) of this
section.
(v) Method of allocation of the certified IDR entity fee upon
agreement or withdrawal before an eligibility determination. When the
parties reach an agreement on an out-of-network rate or withdraw a
dispute for which there is a final selection of the certified IDR
entity, but for which no eligibility determination has yet been made,
unless directed otherwise by both parties, the certified IDR entity is
required to return each party's full certified IDR entity fee within 30
business days of the date both parties notify the certified IDR entity
that they have agreed on an out-of-network rate or agreed to withdraw
the dispute.
(2) Administrative fee--(i) In general. Each party to a dispute for
which a certified IDR entity is selected under paragraph (c)(1) of this
section must pay a non-refundable administrative fee to the Secretary
for participating in the Federal IDR process.
(A) Timing of payment of administrative fee. The initiating party
must pay the administrative fee within 2 business days of the date of
preliminary selection of the certified IDR entity as described in
paragraph (c)(1)(iii) of this section. The non-initiating party must
pay the administrative fee within 2 business days of the date the non-
initiating party receives notice that an eligibility determination for
the Federal IDR process has been reached by either the certified IDR
entity or the Departments in accordance with paragraph (c)(2) of this
section.
(B) Agreements and withdrawals. In the case of an agreement, as
described in paragraph (c)(3)(i) of this section, or a withdrawal, as
described in paragraph (c)(3)(ii) of this section, the administrative
fee will not be returned to the parties if preliminary selection of the
certified IDR entity has occurred, as described in paragraph (c)(1)(i)
of this section; if not yet collected, the administrative fee must
still be paid, except as provided in paragraph (d)(2)(i)(C) of this
section for a dispute closed for nonpayment by an initiating party.
(C) Failure to pay administrative fee. If the initiating party
fails to pay the administrative fee in accordance with paragraph
(d)(2)(i)(A) of this section, the dispute will be closed due to
nonpayment and neither party will be responsible for the administrative
fee. If the non-initiating party fails to pay the administrative fee in
accordance with paragraph (d)(2)(i)(A) of this section, that party's
offer will not be considered received and the non-initiating party will
continue to be responsible for payment of the administrative fee.
(D) Collection of unpaid fees. Any party that fails to pay the
administrative fee owed in accordance with paragraph (d)(2)(i)(A) of
this section is obligated to pay the administrative fee otherwise due
and owing, except as provided in paragraph (d)(2)(i)(C) of this section
for a dispute closed for nonpayment by an initiating party. The
Secretary will pursue collection from a party to a dispute of any
administrative fee that is not timely paid pursuant to applicable debt
collection authorities.
(ii) Administrative fee amount. The administrative fee amount and
method of payment will be established through notice and comment
rulemaking in a manner such that the total administrative fees paid for
a year, including administrative fees reduced under paragraph
(d)(2)(iii) of this section, are estimated to be equal to the projected
amount of expenditures made by the Secretaries of the Treasury, Labor,
and Health and Human Services for the year in carrying out the Federal
IDR process.
(A) For disputes initiated on or after the later of the effective
date of Federal Independent Dispute Resolution (IDR) Process
Administrative Fee and Certified IDR Entity Fee Ranges final rules or
January 1, 2024, the administrative fee amount is $150 per party per
dispute, which will remain in effect until changed by subsequent
rulemaking.
(B) [Reserved]
(iii) Reducing the administrative fee amount. For disputes
initiated on or after January 1, 2025--
(A) The Secretary may reduce the administrative fee for both
parties in accordance with paragraph (d)(2)(iii)(C) of this section
when the highest offer made by either party during open negotiation for
the dispute is less than the threshold established through notice and
comment rulemaking, pursuant to paragraph (d)(2)(ii) of this section.
For a dispute that satisfies the requirements for a reduced
administrative fee in accordance with this paragraph and for which a
determination has been made that the dispute is eligible for the
Federal IDR process in accordance with paragraph (c)(2) of this
section, the administrative fee amount may be reduced to 50 percent of
the administrative fee amount as described in paragraph (d)(2)(ii) of
this section for each party to the dispute. For a dispute that
satisfies the requirements for a reduced administrative fee in
accordance with this paragraph and for which a determination has been
made that the dispute is ineligible for the Federal IDR process in
accordance with paragraph (c)(2) of this section, the administrative
fee amount may be reduced to 50 percent of the administrative fee
amount as described in paragraph (d)(2)(ii) of this section for the
initiating party and to 20 percent of the administrative fee amount for
the non-initiating party.
[[Page 75863]]
(B) The Secretary may reduce the administrative fee for a non-
initiating party in accordance with paragraph (d)(2)(iii)(C) of this
section when the dispute is determined to be ineligible for the Federal
IDR process in accordance with paragraph (c)(2) of this section. For a
dispute that satisfies the requirements for a reduced administrative
fee in accordance with this paragraph, the administrative fee amount
for the non-initiating party may be reduced to 20 percent of the
administrative fee amount as described in paragraph (d)(2)(ii) of this
section.
(C) The reduced administrative fee amounts provided for in
paragraphs (d)(2)(iii)(A) and (B) of this section shall be established
in notice and comment rulemaking and will remain in effect until
changed by subsequent rulemaking, pursuant to paragraph (d)(2)(ii) of
this section.
(e) Certification of IDR entity--(1) In general. For further
guidance, see Sec. 54.9816-8T(e)(1);
(2) Requirements. For further guidance, see Sec. 54.9816-8T(e)(2)
introductory text;
(i) For further guidance, see Sec. 54.9816-8T(e)(2)(i);
(ii) For further guidance, see Sec. 54.9816-8T(e)(2)(ii);
(iii) For further guidance, see Sec. 54.9816-8T(e)(2)(iii);
(iv) For further guidance, see Sec. 54.9816-8T(e)(2)(iv);
(v) For further guidance, see Sec. 54.9816-8T(e)(2)(v);
(vi) Meet appropriate indicators of fiscal integrity and stability
by demonstrating that the certified IDR entity has a system of
safeguards and controls in place to prevent and detect improper
financial activities by its employees and agents to assure fiscal
integrity and accountability for all certified IDR entity fees and
administrative fees (if applicable) received, held, and disbursed and
by submitting 3 years of financial statements or, if not available,
other information to demonstrate fiscal stability of the certified IDR
entity;
(vii) For further guidance, see Sec. 54.9816-8T(e)(2)(vii);
(viii) Have a procedure in place to retain the certified IDR entity
fees described in paragraph (d)(1) of this section paid by both parties
in a trust or escrow account and to return the certified IDR entity fee
paid by the prevailing party or a portion of each party's certified IDR
entity fee in the case of an agreement described in paragraph (c)(3)(i)
of this section, a withdrawal described in paragraph (c)(3)(ii) of this
section, or a circumstance described under paragraph (d)(1)(iii) of
this section, within 30 business days following the date of the
determination;
(ix) Have a procedure in place to retain the administrative fees
(if applicable) described in paragraph (d)(2) of this section and to
remit the administrative fees to the Secretary in accordance with the
timeframe and procedures set forth in guidance published by the
Secretary;
(x) For further guidance, see Sec. 54.9816-8T(e)(2)(x); and
(xi) For further guidance, see Sec. 54.9816-8T(e)(2)(xi);
(3) Conflict-of-interest standards. For further guidance, see Sec.
54.9816-8T(e)(3).
(4) Period of Certification. For further guidance, see Sec.
54.9816-8T(e)(4).
(5) Petition for denial or revocation. For further guidance, see
Sec. 54.9816-8T(e)(5).
(6) Denial of IDR entity certification or revocation of certified
IDR entity certification. For further guidance, see Sec. 54.9816-
8T(e)(6).
* * * * *
(g) Extension of time periods for extenuating circumstances--(1) In
general. The time periods specified in this section (other than the
time for payment, if applicable, under Sec. 54.9816-8T(c)(5)(ix)) may
be extended in extenuating circumstances at the Secretary's discretion.
Extenuating circumstances include, but are not limited to when:
(i) With respect to a specific dispute, the Secretary determines
that the parties or certified IDR entity cannot meet applicable
timeframes due to matters beyond the control of one or both parties or
the certified IDR entity, or for other good cause. The certified IDR
entity or either party may also submit a request for an extension due
to extenuating circumstances to the Secretary through the Federal IDR
portal. The requesting certified IDR entity or party must attest that
it will take prompt action to ensure that the certified IDR entity's
payment determination under this section may be made as soon as
administratively practicable under the circumstances; or
(ii) The Secretary determines that the parties or certified IDR
entity cannot meet applicable timeframes due to systematic delays in
processing disputes under the Federal IDR process, such as an
unforeseen volume of disputes or Federal IDR portal system failures.
Extensions provided due to extenuating circumstances caused by an
unforeseen volume of disputes will be applied to the timeframe for
eligibility determinations under paragraph (c)(2) of this section.
Extensions provided due to extenuating circumstances caused by systems
failures within the Federal IDR portal will be applied to the Federal
IDR process timeframe(s) determined relevant by the Secretary. The
Secretary will post a public notice regarding any extensions of time
periods pursuant to this paragraph (g)(1)(ii).
(A) Timeframe following an extension to eligibility determination.
When an extension to the eligibility determination timeframe pursuant
to paragraph (g)(1)(ii) of this section is in effect, the start date of
the subsequent timeframes in the Federal IDR process will be determined
based on the date of completion of the eligibility determination by the
certified IDR entity or the Secretary.
(1) Submission of offers. The parties must submit their offers and
certified IDR entity fees to the certified IDR entity not later than 10
business days after the qualified IDR items and services are determined
eligible as described in paragraph (c)(2) of this section.
(2) Payment Determination. The certified IDR entity must make the
payment determination and notification of the payment determination to
the parties not later than 30 business days after the qualified IDR
items and services are determined eligible as described in paragraph
(c)(2) of this section.
(B) Timeframe following an extension to other timeframes in the
Federal IDR process. When an extension to any timeframe within the
Federal IDR process, other than the eligibility timeframe, is in effect
pursuant to paragraph (g)(1)(ii) of this section, the start date of
each subsequent timeframe in the Federal IDR process will be determined
based on the date of completion of the process for which the extension
was granted.
(2) [Reserved]
(h) Applicability date. (1) Paragraph (a) of Sec. 54.9816-8T is
applicable with respect to plan years beginning on or after January 1,
2022, except that the provisions regarding IDR entity certification at
Sec. 54.9816-8T(a) and (e) are applicable beginning on October 7,
2021, and the revised definition for batched qualified IDR items and
services at paragraph (a)(2)(i) of this section is applicable to
disputes with open negotiation periods beginning on or after the later
of August 15, 2024, or 90 days after the effective date of the rule.
(2) Paragraph (b) of this section is applicable to disputes with
open negotiation periods beginning on or after the later of August 15,
2024, or 90 days after the effective date of the rule.
[[Page 75864]]
(3) Paragraph (c)(1) of this section, regarding the selection of a
certified IDR entity, is applicable to disputes with open negotiation
periods beginning on or after the later of August 15, 2024, or 90 days
after the effective date of the rule, except that paragraphs
(c)(1)(iv)(A)(1) through (3) of this section, regarding the conflict-
of-interest standards, are applicable with respect to plan years
beginning on or after January 1, 2022.
(4) Paragraph (c)(2) of this section, regarding the Federal IDR
process eligibility review and paragraph (c)(3) of this section
regarding the authority to continue negotiations or withdraw, are
applicable to disputes with open negotiation periods beginning on or
after the later of August 15, 2024, or 90 days after the effective date
of the rule, and paragraph (c)(4) of this section regarding the
treatment of batched and bundled qualified IDR items and services is
applicable 90 days after the effective date of the rule.
(5) Paragraphs (c)(5)(i) and (ii), and (c)(5)(vii)(B) and(C) of
this section regarding the deadlines for the submission of offers,
payment determination and notification, suspension of certain
subsequent IDR requests, and subsequent submission of requests
submitted are applicable to disputes with open negotiation periods
beginning on or after the later of August 15, 2024, or 90 days after
the effective date of the rule. Paragraphs (c)(5)(iii) and (vi) of this
section regarding considerations in payment determinations and the
related examples and paragraph (c)(5)(vi)(B) of this section regarding
written decisions are applicable with respect to items or services
furnished on or after October 25, 2022, for plan years beginning on or
after January 1, 2022. Section 54.9816-8T(c)(5)(v) through
(c)(5)(vi)(A), Sec. 54.9816-8T(c)(5)(vii)(A), and Sec. 54.9816-
8T(c)(5)(viii) and (ix) are applicable with respect to plan years
beginning on or after January 1, 2022.
(6) Paragraph (d) of this section regarding the costs of the IDR
process is applicable to disputes initiated on or after January 1,
2025.
(7) Section 54.9816-8T(e) is applicable with respect to plan years
beginning on or after January 1, 2022. The provisions regarding IDR
entity certification at paragraphs (1), (e)(2)(i) through (vi),
(e)(2)(x) and (xi), and (e)(3) through (6) of this section are
applicable beginning on October 7, 2021. Paragraphs (e)(2)(vi), (viii),
and (ix) of this section regarding the certified IDR entity's controls
to prevent and detect improper financial activities, and procedures to
retain the certified IDR entity fee and administrative fee are
applicable upon the effective date of the rule.
(8) Section 54.9816-8T(f) is applicable with respect to plan years
beginning on or after January 1, 2022. Section 54.9816-8(f)(1)(v)(F)
regarding reporting of information relating to the Federal IDR process
is applicable with respect to items or services furnished on or after
October 25, 2022, for plan years beginning on or after January 1, 2022.
(9) Paragraph (g) of this section regarding the extension of time
periods for extenuating circumstances is applicable to disputes with
open negotiation periods beginning on or after the later of August 15,
2024, or 90 days after the effective date of the rule.
(10) Until the relevant applicability date for the requirements of
this section, plans, issuers, providers, facilities, providers of air
ambulance services and certified IDR entities are required to continue
to comply with the corresponding section of Sec. Sec. 54.9816-8 and
54.9816-8T in effect on October 25, 2022.
(i) Severability. (1) Any provision of this section held to be
invalid or unenforceable by its terms, or as applied to any person or
circumstance, shall be construed so as to continue to give maximum
effect to the provision permitted by law, unless such holding shall be
one of utter invalidity or unenforceability, in which event the
provision shall be severable from this section and shall not affect the
remainder thereof or the application of the provision to persons not
similarly situated or to dissimilar circumstances.
(2) The provisions of paragraphs (b)(1), (c)(2)(ii), (c)(4),
(d)(2), and (g)(1) of this section are intended to be severable from
one another, from any grant of forbearance from removal resulting from
this subpart, and from any provision referenced in those paragraphs.
The provisions in Sec. Sec. 54.9816-8 and 54.9816-8T are intended to
be severable from the provisions in Sec. Sec. 54.9816-6A, 54.9816-6,
54.9816-6T, and 54.9816-9, from any grant of forbearance from removal
resulting from this subpart, and from any provision referenced in
Sec. Sec. 54.9816-6A, 54.9816-6, 54.9816-6T, and 54.9816-9.
0
10. Section 54.9816-8T is amended by:
0
a. Revising paragraphs (a)(2)(i), (b)(1) through (3), (c)(1)(i) and
(c)(2);
0
b. Redesignating paragraphs (c)(3) through (c)(4) as (c)(4) through
(c)(5);
0
c. Adding new paragraph (c)(3);
0
d. Revising newly redesignated paragraphs (c)(4)(i) introductory text,
(c)(4)(i)(B) through (D), (c)(4)(ii), (c)(5(i) introductory text,
(c)(5)(ii), (iii) and (iv), (c)(5)(vi)(B), (c)(5)(vii)(A) introductory
text, and (c)(5)(vii)(B) and (C);
0
e. Revising paragraphs (d) introductory text, (e)(2)(vi), (viii) and
(ix), and (g); and
0
f. Adding paragraphs (h) and (i).
The revisions and additions read as follows:
Sec. 54.9816-8T Independent dispute resolution process. (temporary)
(a) * * *
(2) * * *
(i) Batched items and services--For further guidance, see Sec.
54.9816-8(a)(2)(i);
* * * * *
(b) * * *
(1) Determination of payment amount through open negotiation. For
further guidance, see Sec. 54.9816-8(b)(1);
(2) Initiating the Federal IDR process. For further guidance, see
Sec. 54.9816-8(b)(2);
(3) Manner. For further guidance, see Sec. 54.9816-8(b)(3).
(c) * * *
(1) * * *
(i) Preliminary selection of the certified IDR entity. For further
guidance, see Sec. 54.9816-8(c)(1).
* * * * *
(2) Federal IDR process eligibility review. For further guidance,
see Sec. 54.9816-8(c)(2).
(3) Authority to continue negotiations or withdraw. For further
guidance, see Sec. 54.9816-8(c)(3).
(4) * * *
(i) In general. For further guidance, see Sec. 54.9816-8(c)(4)(i).
(A) The qualified IDR items and services are billed by the same
provider or group of providers, the same facility, or the same provider
of air ambulance services. Items and services are billed by the same
provider or group of providers, the same facility, or the same provider
of air ambulance services if the items or services are billed with the
same National Provider Identifier or Tax Identification Number;
(B) For further guidance, see Sec. 54.9816-8(c)(4)(i)(B).
(C) For further guidance, see Sec. 54.9816-8(c)(4)(i)(C).
(D) For further guidance, see Sec. 54.9816-8(c)(4)(i)(D).
(ii) Treatment of bundled payment arrangements. For further
guidance, see Sec. 54.9816-8(c)(4)(ii)
(5) * * *
(i) Submission of offers. For further guidance, see Sec. 54.9816-
8(c)(5)(i).
* * * * *
(ii) Payment determination and notification. For further guidance,
see Sec. 54.9816-8(c)(5)(ii).
[[Page 75865]]
(A) For further guidance, see Sec. 54.9816-8(c)(5)(ii)(A)
(B) Notify the plan and the provider or facility, as applicable, of
the selection of the offer under paragraph (c)(5)(ii)(A) of this
section, and provide the written decision required under (c)(5)(vi) of
this section.
(iii) Considerations in determination. For further guidance, see
Sec. 54.9816-8(c)(5)(iii).
(iv) Examples. For further guidance, see Sec. 54.9816-8(c)(5)(iv).
* * * * *
(vi) * * *
(B) For further guidance, see Sec. 54.9816-8(c)(5)(vi)(B).
(vii) * * *
(A) Binding determination made by a certified IDR entity under
paragraph (c)(5)(ii) of this section:
* * * * *
(B) Suspension of certain subsequent IDR requests. For further
guidance, see Sec. 54.9816-8(c)(5)(vii)(B).
(C) Subsequent submission of requests permitted. For further
guidance, see Sec. 54.9816-8(c)(5)(vii)(C).
* * * * *
(d) Costs of IDR process. For further guidance, see Sec. 54.9816-
8(d);
* * * * *
(e) * * *
(2) * * *
(vi) For further guidance, see Sec. 54.9816-8(e)(2)(vi);
* * * * *
(viii) For further guidance, see Sec. 54.9816-8(e)(2)(viii);
(ix) For further guidance, see Sec. 54.9816-8(e)(2)(ix);
* * * * *
(g) Extension of time periods for extenuating circumstances. For
further guidance, see Sec. 54.9816-8(g).
(h) Applicability date. For further guidance, see Sec. 54.9816-
8(h);
(i) Severability. For further guidance, see Sec. 54.9816-8(i).
0
11. Section 54.9816-9 is added to read as follows:
Sec. 54.9816-9 Federal Independent Dispute Resolution Registry of
Group Health Plans, Health Insurance Issuers, and Federal Employees
Health Benefits Carriers.
(a) Establishment of Federal independent dispute resolution
registry. The Secretary, jointly with the Secretary of Health and Human
Services and the Secretary of Labor, will establish a Federal IDR
registry consisting of the information described in paragraph (b)(2) of
this section and will assign a registration number for each group
health plan, health insurance issuer offering group or individual
health insurance coverage, and Federal Employees Health Benefits (FEHB)
Program carrier. The information contained in the registry will be made
available to parties seeking to initiate an open negotiation or a
dispute through the Federal IDR portal, and will be searchable,
including by registration number.
(b) Federal IDR registration--(1) Registration requirement. Each
group health plan subject to the Federal IDR process must register with
the Federal IDR registry as specified by the Secretary in guidance.
Initial registration must be completed by the later of the date that is
30 business days after the effective date of the final rule, the date
that is 30 business days after the registry becomes available, or the
date the group health plan begins offering a group health plan coverage
subject to the Federal IDR process.
(2) Required data elements. Group health plans subject to the
registration requirement must include the following information with
their registration:
(i) The legal business name (if any) of the group health plan, and,
if applicable, the legal business name of the group health plan
sponsor;
(ii) Whether the plan is a self- or fully-insured group health plan
subject to ERISA or a self- or fully-insured church plan;
(iii) The State(s) in which the plan is subject to a specified
State law, as defined in Sec. 54.9816-3T for any items or services for
which the protections of Sec. Sec. 54.9816-1T, 54.9816-4T, and
54.9816-5T apply;
(iv) The State(s) in which the plan is subject to an All-Payer
Model Agreement under section 1115A of the Social Security Act for any
items or services to which the protections in Sec. Sec. 54.9816-1T,
54.9816-4T, and 54.9816-5T, apply;
(v) For self-insured group health plans not otherwise subject to
State law, any State(s) in which the group health plan has properly
effectuated an election to opt in to a specified State law as defined
in Sec. 54.9816-3T, if that State allows a plan not otherwise subject
to the State law to opt-in;
(vi) Contact information, including a telephone number and email
address, for the appropriate person or office with whom to initiate
open negotiations for purposes of determining an amount of payment
(including cost sharing) for such item or service;
(vii) The 14-digit Health Insurance Oversight System (HIOS)
identifier; or if the 14-digit HIOS identifier has not been assigned,
the 5-digit HIOS identifier; or if no HIOS identifier is available, the
plan's or the plan sponsor's Employer Identification Number (EIN) and
the plan's plan number (PN), if a PN is available;
(viii) Additional information needed to identify the plan and the
applicable Federal and State requirements for determining appropriate
out-of-network payment rates for items or services to which the
protections against balance billing in this part apply, as specified by
the Secretary in guidance; and
(ix) Additional information needed for purposes of administrative
fee collection, as specified by the Secretary in guidance.
(3) Updating disclosures. A plan must timely report to the
Secretary changes to the information required under this section within
30 calendar days after the information changes. A plan must confirm the
accuracy of its registration annually in the fourth quarter of each
calendar year.
(4) Third party authority. The requirements of paragraphs (b)(1)
through (3) of this section may be performed by a third party
administrator or service provider with authority to act on behalf of
the group health plan subject to the Federal IDR process. If the
registration requirements are performed by such third party
administrator or service provider the group health plan or health
insurance issuer offering group or individual health insurance coverage
must require that such third party administrator or service provider
clearly delineate each group health plan or health insurance issuer
offering group health insurance coverage for which it has authority to
act. If such third party administrator or service provider fails to
provide the information in compliance with the requirements of
paragraphs (b)(1) through (3) of this section the plan or issuer will
be in violation of the requirements of this section.
(c) Severability. (1) Any provision of this section held to be
invalid or unenforceable by its terms, or as applied to any person or
circumstance, shall be construed so as to continue to give maximum
effect to the provision permitted by law, unless such holding shall be
one of utter invalidity or unenforceability, in which event the
provision shall be severable from this section and shall not affect the
remainder thereof or the application of the provision to persons not
similarly situated or to dissimilar circumstances.
(2) The provisions in Sec. 54.9816-9 are intended to be severable
from the provisions in Sec. Sec. 54.9816-6, 54.9816-6T, 54.9816-8, and
54.9816-8T, from any grant of forbearance from removal resulting from
this subpart, and from any provision referenced in Sec. Sec. 54.9816-
6, 54.9816-6T, 54.9816-8, and 54.9816-8T.
[[Page 75866]]
DEPARTMENT OF LABOR
EMPLOYEE BENEFITS SECURITY ADMINISTRATION
For the reasons stated in the preamble, the Department of Labor
proposes to amend 29 CFR part 2590 as set forth below:
PART 2590--RULES AND REGULATIONS FOR GROUP HEALTH PLANS
0
12. The authority citation for part 2590 continues to read as follows:
Authority: 29 U.S.C. 1027, 1059, 1135, 1161-1168, 1169, 1181-
1183, 1181 note, 1185, 1185a, 1185b, 1191, 1191a, 1191b, and 1191c;
sec. 101(g), Pub. L. 104-191, 110 Stat. 1936; sec. 401(b), Pub. L.
105-200, 112 Stat. 645 (42 U.S.C. 651 note); sec. 512(d), Pub. L.
110-343, 122 Stat. 3881; sec. 1001, 1201, and 1562(e), Pub. L. 111-
148, 124 Stat. 119, as amended by Pub. L. 111-152, 124 Stat. 1029;
Division M, Pub. L. 113-235, 128 Stat. 2130; Secretary of Labor's
Order 1-2011, 77 FR 1088 (Jan. 9, 2012).
Subpart D--Surprise Billing and Transparency Requirements
0
13. Section 2590.716-3 is amended by adding the definition of ``Bundled
payment arrangement'' in alphabetical order to read as follows:
Sec. 2590.716-3 Definitions.
* * * * *
Bundled payment arrangement means an arrangement under which--
(1) A provider, facility, or provider of air ambulance services
bills for multiple items or services furnished to a single patient
under a single service code that represents multiple items or services
(for example, a Diagnosis-Related Group (DRG) code); or
(2) A plan or issuer makes an initial payment or notice of denial
of payment to a provider, facility, or provider of air ambulance
services under a single service code that represents multiple items or
services furnished to a single patient (for example, a DRG code).
* * * * *
0
14. Section 2590.716-6 is amended by:
0
a. Revising paragraphs (d) introductory text and (d)(1)(iv);
0
b. Redesignating paragraph (d)(1)(v) as paragraph (d)(1)(vi);
0
c. Adding a new paragraph (d)(1)(v);
0
d. Revising paragraph (d)(2) introductory text; and
0
e. Adding paragraph (g).
The revisions and additions read as follows:
Sec. 2590.716-6 Methodology for calculating qualifying payment
amount.
* * * * *
(d) Information to be shared about the qualifying payment amount.
In cases in which the recognized amount, with respect to an item or
service furnished by a nonparticipating provider or nonparticipating
emergency facility, is the qualifying payment amount or the amount
billed by the provider or facility, or if the amount on which cost
sharing is based with respect to air ambulance services furnished by a
nonparticipating provider of air ambulance services is the qualifying
payment amount or the amount billed by the provider of air ambulance
services, the plan or issuer must provide to the provider, facility, or
provider of air ambulance services, as applicable, in writing, in paper
or electronic form--
(1) * * *
(iv) A statement that--
(A) If the provider, facility, or provider of air ambulance
services, as applicable, wishes to initiate a 30-business-day open
negotiation period for purposes of determining the out-of-network rate,
the provider, facility, or provider of air ambulance services must:
(1) Contact the appropriate person or office to initiate open
negotiation within 30 business days of receiving the initial payment or
notice of denial of payment, and
(2) For disclosures required to be provided on or after [DATE 90
DAYS AFTER PUBLICATION OF FINAL REGULATIONS IN THE FEDERAL REGISTER]
and once the open negotiation notice can be submitted through the
Federal IDR portal, notify the Secretary as described under Sec.
2590.716-8(b)(1)(i); and
(B) If the 30-business-day open negotiation period does not result
in an agreement on the amount of payment the provider, facility, or
provider of air ambulance services may generally initiate the Federal
IDR process within 4 business days after the end of the open
negotiation period;
(v) For disclosures required to be provided on or after [date 90
days after publication of final regulations in the Federal Register],
the legal business name of the group health plan (if any) or issuer,
the legal business name of the plan sponsor (if applicable), and the
registration number assigned under Sec. 2590.716-9, if the plan or
issuer is registered under Sec. 2590.716-9.
(2) In a timely manner upon the request of the provider, facility,
or provider of air ambulance services:
* * * * *
(g) Severability. (1) Any provision of this section held to be
invalid or unenforceable by its terms, or as applied to any person or
circumstance, shall be construed so as to continue to give maximum
effect to the provision permitted by law, unless such holding shall be
one of utter invalidity or unenforceability, in which event the
provision shall be severable from this section and shall not affect the
remainder thereof or the application of the provision to persons not
similarly situated or to dissimilar circumstances.
(2) The provisions in Sec. 2590.716-6 are intended to be severable
from the provisions in Sec. Sec. 2590.716-6A, 2590.716-8, and
2590.716-9, from any grant of forbearance from removal resulting from
this subpart, and from any provision referenced in Sec. Sec. 2590.716-
6A, 2590.716-8, and 2590.716-9.
0
15. Section 2590.716-6A is added to subpart D to read as follows:
Sec. 2590.716-6A Use of Claim Adjustment Reason Codes and Remittance
Advice Remark Codes.
(a) In general. When providing any paper or electronic remittance
advice to an entity that does not have a contractual relationship
directly or indirectly with a group health plan or a health insurance
issuer offering group or individual health insurance coverage with
respect to the furnishing of the item or service under the plan or
coverage in response to a claim for payment for health care items and
services furnished by that entity, the plan or issuer must use claim
adjustment reason codes (CARCs) and remittance advice remark codes
(RARCs) (see 45 CFR 162.1602 and 162.1603) as specified in guidance
issued by the Secretaries of the Treasury, Labor, and Health and Human
Services, or as required under any applicable adopted standards and
operating rules under 45 CFR part 162, to communicate information
related to whether the claim is or is not subject to the provisions of
this subpart and 45 CFR part 149, subpart E.
(b) Severability. (1) Any provision of this section held to be
invalid or unenforceable by its terms, or as applied to any person or
circumstance, shall be construed so as to continue to give maximum
effect to the provision permitted by law, unless such holding shall be
one of utter invalidity or unenforceability, in which event the
provision shall be severable from this section and shall not affect the
remainder thereof or the application of the provision to persons not
similarly situated or to dissimilar circumstances.
(2) The provisions in Sec. 2590.716-6A are intended to be
severable from the provisions in Sec. Sec. 2590.716-6, 2590.716-8, and
2590.716-9, from any grant of
[[Page 75867]]
forbearance from removal resulting from this subpart, and from any
provision referenced in Sec. Sec. 2590.716-6, 2590.716-8, and
2590.716-9.
0
16. Section 2590.716-8 is amended by:
0
a. Revising paragraphs (a)(2)(i), (b)(1)(i), and (b)(1)(ii)(A);
0
b. Removing and reserving paragraph (b)(1)(ii)(B);
0
c. Adding paragraph (b)(1)(iii);
0
d. Revising paragraph (b)(2)(i);
0
e. Redesignating paragraph (b)(2)(ii) as (b)(2)(i)(A);
0
f. Adding and reserving paragraph (b)(2)(i)(B);
0
g. Redesignating paragraph (b)(2)(iii) as (b)(2)(ii);
0
h. Revising newly redesignated paragraph (b)(2)(ii)(A);
0
i. Reserving newly redesignated paragraph (b)(2)(ii)(B);
0
j. Removing newly redesignated paragraph (b)(2)(ii)(C);
0
k. Adding paragraphs (b)(2)(iii) and (b)(3);
0
l. Revising paragraph (c)(1);
0
m. Redesignating paragraphs (c)(2) through (4) as paragraphs (c)(3)
through (5), respectively;
0
n. Adding a new paragraph (c)(2);
0
o. Revising newly redesignated paragraphs (c)(3), (c)(4)(i)
introductory text, (c)(4)(i)(B) through (D), (c)(4)(ii), (c)(5)(i)
introductory text, (c)(5)(ii) introductory text,
0
p. Adding paragraphs (c)(5)(ii)(A)(1) and (2) and removing the
reference to ``(c)(4)'' and adding in its place ``(c)(5)'' in newly
redesignated paragraphs (c)(5)(ii)(A) introductory text and (B);;
0
q. Revising paragraphs (c)(5)(vii)(B) and (C);;
0
r. Revising paragraphs (d), (e)(2)(vi), (viii), and (ix), (g) and (h);
0
s. Adding paragraph (i).
The revisions and additions read as follows:
Sec. 2590.716-8 Independent dispute resolution process.
(a) * * *
(2) * * *
(i) Batched qualified IDR items and services means multiple
qualified IDR items or services that are considered jointly as part of
one payment determination by a certified IDR entity for purposes of the
Federal IDR process in accordance with paragraph (c)(4) of this
section.
* * * * *
(b) * * *
(1) * * *
(i) In general. With respect to an item or service that meets the
requirements of paragraph (a)(2)(xi)(A) of this section, the provider,
facility, or provider of air ambulance services, or the group health
plan or health insurance issuer offering group or individual health
insurance coverage may, during the 30-business-day period beginning on
the day the provider, facility, or provider of air ambulance services
receives an initial payment or notice of denial of payment regarding
the item or service, initiate an open negotiation period for purposes
of determining the out-of-network rate for such item or service. To
initiate the open negotiation period, a party must submit a written
open negotiation notice with the content specified in paragraph
(b)(1)(ii) of this section to the other party and to the Secretary in
the manner specified in paragraph (b)(3) of this section. The 30-
business-day open negotiation period begins on the day on which the
party first submits the open negotiation notice and the remittance
advice documentation specified in paragraph (b)(1)(ii)(A)(12) of this
section to the other party and the Secretary. The party in receipt of
the open negotiation notice must provide to the other party and to the
Secretary in the manner specified in paragraph (b)(3) of this section
as soon as practicable, but no later than the 15th business day of the
30-business-day open negotiation period, a written notice and
supporting documentation in response to the open negotiation notice, as
specified in paragraph (b)(1)(iii)(A) of this section.
(ii) * * *
(A) Content. The open negotiation notice must include, with respect
to the item or service that is the subject of the open negotiation
notice, information about the item or service and the parties
including:
(1) Information sufficient to identify the provider, facility, or
provider of air ambulance services, including the name and current
contact information (including the legal business name, email address,
phone number, and mailing address) as provided with the claim form
submitted by the provider, facility, or air ambulance provider to the
plan or issuer, and the National Provider Identifier (NPI);
(2) Information sufficient to identify the plan or issuer,
including the plan's or issuer's registration number, as required under
Sec. 2590.716-9, if the plan or issuer is registered under Sec.
2590.716-9, or an attestation from the party submitting the open
negotiation notice that the plan or issuer was not registered prior to
the date it submitted the notice; the legal business name of the plan
or issuer, as well as the current contact information (name, email
address, phone number, and mailing address) of the plan or issuer as
provided with the initial payment or notice of denial of payment; and
if the party submitting the open negotiation notice is a plan or
issuer, the plan type (for example, self-insured or fully-insured);
(3) The name and contact information (including the legal business
name, email address, phone number, and mailing address) for any third
party representing the party submitting the open negotiation notice,
and an attestation that the third party has the authority to act on
behalf of the party it represents in the open negotiation;
(4) Information sufficient to identify the item or service,
including: the date(s) the item or service was furnished and, if the
party submitting the open negotiation notice is a provider, facility,
or provider of air ambulance services, the date(s) that the provider,
facility, or provider of air ambulance services received the initial
payment or notice of denial of payment for the item or service from the
plan or issuer; the type of item or service (specifically, whether the
item or service is an emergency service as defined in Sec. 2590.716-
4(c)(2)(i) or (ii), a non-emergency service as described in Sec.
2590.716-5(b), or an air ambulance service as defined in Sec.
2590.716-3); whether the service is a professional service or facility-
based service; the State where the item or service was furnished; the
claim number; the service code; and information to identify the
location where the item or service was furnished (such as, place of
service code or bill type code);
(5) The initial payment amount (including $0 if, for example,
payment is denied);
(6) The qualifying payment amount, if provided with the initial
payment or notice of denial of payment or if the party submitting the
open negotiation notice is a plan or issuer;
(7) An offer of an out-of-network rate for each item or service;
(8) If the party submitting the open negotiation notice is a plan
or issuer, the amount of cost sharing imposed for the item or service,
if any;
(9) If the party submitting the open negotiation notice is a
provider or facility, a statement that the items and services do not
qualify for the notice and consent exception described at 45 CFR
149.410(b) or 149.420(c) through (i);
(10) A statement that the provider, facility, or provider of air
ambulance services was a nonparticipating provider, nonparticipating
emergency facility, or nonparticipating provider of air ambulance
services on the date the item or service was furnished;
(11) General information listed in the standard open negotiation
notice developed by the Secretary pursuant to
[[Page 75868]]
paragraph (b)(3) of this section describing the open negotiation period
and the Federal IDR process (including a description of the purpose of
the open negotiation period and Federal IDR process and key deadlines
in the open negotiation period and Federal IDR process); and
(12) A copy of the initial payment or notice of denial of payment
or other remittance advice that is required to include the disclosures
under Sec. 2590.716-6(d)(1), with respect to the item or service.
(B) [Reserved]
(iii) Open negotiation response notice. (A) Content. The response
to the open negotiation notice must include, with respect to the item
or service that is the subject of the open negotiation response notice,
information about the item or service and the parties including:
(1) Information sufficient to identify the provider, facility, or
provider of air ambulance services, including the name and current
contact information (including the legal business name, email address,
phone number, and mailing address) as provided with the claim form
submitted by the provider, facility, or provider of air ambulance
services to the plan or issuer, and the NPI;
(2) Information sufficient to identify the plan or issuer,
including the plan's or issuer's registration number, as required under
Sec. 2590.716-9 if the plan or issuer is registered under Sec.
2590.716-9, or an attestation from the party submitting the open
negotiation response notice that the plan or issuer was not registered
prior to the date it submitted the notice; the legal business name of
the plan or issuer, as well as the current contact information (name,
email address, phone number, and mailing address) of the plan or issuer
as provided with the initial payment or notice of denial of payment;
and if the party submitting the open negotiation response notice is a
plan or issuer, the plan type (for example, self-insured or fully-
insured);
(3) The name and contact information (including the legal business
name, email address, phone number, and mailing address) for any third
party representing the party submitting the open negotiation response
notice, and an attestation that the third party has the authority to
act on behalf of the party it represents in the open negotiation;
(4) Information sufficient to identify the item or service included
in the open negotiation notice, including the date(s) the item or
service was furnished, and if the party submitting the open negotiation
response notice is a provider, facility, or provider of air ambulance
services, the date(s) that the provider, facility, or provider of air
ambulance services received the initial payment or notice of denial of
payment for such item or service from the plan or issuer, and the claim
number;
(5) If the party submitting the open negotiation response notice is
a plan or issuer, a statement as to whether it agrees that the initial
payment amount (including $0 if, for example, payment is denied) and
the qualifying payment amount reflected in the open negotiation notice
accurately reflects the initial payment amount and qualifying payment
amount disclosed with the initial payment for the item or service, and
if not, or if the open negotiation notice indicates that qualifying
payment amount was not communicated by the plan or issuer with the
initial payment or notice of denial of payment or other remittance
advice, the initial payment amount (including $0 if, for example,
payment is denied) and/or qualifying payment amount it believes to be
correct, and documentation to support the statement (for example, the
remittance advice confirming the qualifying payment amount);
(6) If the party submitting the open negotiation response notice is
a plan or issuer, the amount of cost sharing imposed for the item or
service, if any;
(7) A counteroffer for an out-of-network rate for each item or
service or an acceptance of the other party's offer;
(8) If the party submitting the open negotiation response notice is
a provider or facility, a statement that the items and services do not
qualify for the notice and consent exception described at 45 CFR
149.410(b) or 149.420(c) through (i);
(9) With respect to each item or service, either a statement and
supporting documentation that explains why the item or service is not
subject to the Federal IDR process or a statement agreeing that the
item or service is subject to the Federal IDR process;
(10) A statement as to whether any of the information provided in
the open negotiation notice is inaccurate and the basis for the
statement, as well as supporting documentation; and
(11) A statement confirming that the initial payment or notice of
denial of payment or other remittance advice provided by the party
submitting the open negotiation notice under paragraph
(b)(1)(ii)(A)(12) of this section is accurate, and if inaccurate, a
copy of the accurate initial payment, or notice of denial of payment,
or other remittance advice required to include the disclosures under
Sec. 2590.716-6(d)(1), with respect to the item or service.
(B) [Reserved]
(2) * * *
(i) In general. Either party may initiate the Federal IDR process
with respect to a qualified IDR item or service for which the parties
do not agree upon an out-of-network rate by the last day of the open
negotiation period provided for under paragraph (b)(1) of this section.
To initiate the Federal IDR process, a party (the initiating party)
must submit a written notice of IDR initiation, consistent with
paragraph (b)(2)(ii) of this section, to the other party to the dispute
(the non-initiating party), and to the Secretary in the manner
specified in paragraph (b)(3) of this section, during the 4-business-
day period beginning on the first business day after the last day of
the open negotiation period (unless it is otherwise required to be
submitted in the timeframe specified in paragraph (c)(5)(vii)(C) of
this section). The date of IDR initiation is the date that the
Secretary receives the notice of IDR initiation described in paragraph
(b)(2)(ii) of this section.
* * * * *
(B) [Reserved]
(ii) * * *
(A) Content. The notice of IDR initiation must include, with
respect to the item or service that is the subject of the notice,
information about the item or service and the parties including:
(1) Information sufficient to identify the provider, facility, or
provider of air ambulance services, including the name and current
contact information (including the legal business name, email address,
phone number, and mailing address), and the NPI; and if the initiating
party is a provider, facility, or provider of air ambulance services,
the Tax Identification Number (TIN);
(2) Information sufficient to identify the plan or issuer,
including the plan's or issuer's registration number, as required under
Sec. 2590.716-9 if the plan or issuer is registered under Sec.
2590.716-9, or an attestation from the initiating party that the plan
or issuer was not registered prior to the date that it submitted the
notice; the legal business name of the plan or issuer, as well as the
current contact information (name, email address, phone number, and
mailing address) of the plan or issuer as provided with the initial
payment or notice of denial of payment; and if the initiating party is
a plan or issuer, the plan type (for example, self-insured or fully-
insured) and TIN (or, in the case of a plan that does not have a TIN,
the TIN of the plan sponsor);
(3) The name and contact information (including the legal business
name, email address, phone number, and
[[Page 75869]]
mailing address) for any third party representing the initiating party,
and an attestation that the third party has the authority to act on
behalf of the party it represents in the Federal IDR process;
(4) Information sufficient to identify whether the dispute being
initiated includes batched or bundled qualified IDR items or services
as described in paragraph (c)(4) of this section;
(5) Information sufficient to identify the qualified IDR item or
service that is the subject of the notice of IDR initiation, including
the date(s) the qualified IDR item or service was furnished; if the
initiating party is a provider, facility, or provider of air ambulance
services, the date(s) that the provider, facility, or provider of air
ambulance services received the initial payment or notice of denial of
payment for such item or service from the plan or issuer; the date the
open negotiation period under paragraph (b)(1) of this section began;
the type of item or service (specifically, whether the qualified IDR
item or service is an emergency service as defined in Sec. 2590.716-
4(c)(2)(i) or (ii), a non-emergency service as described in Sec.
2590.716-5(b), or an air ambulance service as defined in Sec.
2590.716-3); whether the service is a professional service or facility-
based service; the State where the item or service was furnished; the
claim number; the service code; and information to identify the
location the item or service was furnished (including place of service
code or bill type code);
(6) The initial payment amount (including $0 if, for example,
payment is denied);
(7) The qualifying payment amount, if provided with the initial
payment or notice of denial of payment or if the initiating party is a
plan or issuer;
(8) If the initiating party is a provider or facility, a statement
that the items and services do not qualify for the notice and consent
exception described at 45 CFR 149.410(b) or 149.420(c) through (i);
(9) A statement that the provider, facility, or provider of air
ambulance services was a nonparticipating provider, nonparticipating
emergency facility, or nonparticipating provider of air ambulance
services on the date the item or service was furnished;
(10) Attestation that the item or service under dispute is a
qualified IDR item or service, and the basis for the attestation;
(11) General information listed in the standard notice of IDR
initiation developed by the Secretary pursuant to paragraph (b)(3) of
this section describing the Federal IDR process (including a
description of the purpose of the Federal IDR process and key deadlines
in the Federal IDR process);
(12) A copy of the initial payment or notice of denial of payment
or other remittance advice that is required to include the disclosures
under Sec. 2590.716-6(d)(1), with respect to the item or service;
(13) Preferred certified IDR entity; and
(14) A statement describing the key aspects of the claim, such as
patient acuity or level of training of the provider, facility, or
provider of air ambulance services that furnished the qualified IDR
item or service, discussed by the parties during open negotiation that
relate to the payment for the disputed claim, whether the reasons for
initiating the Federal IDR process are different from the aspects of
the claim discussed during the open negotiation period, and an
explanation of why the party is initiating the Federal IDR process,
including any of the permissible considerations described in Sec. Sec.
2590.716-8(c)(5)(iii) and 2590.717-2(b)(2) that serve as the party's
basis for initiating the Federal IDR process.
(B) [Reserved]
(iii) Notice of IDR initiation response. The non-initiating party
must provide to the initiating party and to the Secretary in the manner
specified in paragraph (b)(3) of this section within 3 business days
after the date of IDR initiation, a written notice and supporting
documentation in response to the notice of IDR initiation, as specified
in paragraph (b)(2)(iii)(A) of this section.
(A) Content. The notice of IDR initiation response must include,
with respect to the item or service that is the subject of the notice,
information about the item or service and the parties including:
(1) Information sufficient to identify the provider, facility, or
provider of air ambulance services, including the name and current
contact information (including the legal business name, email address,
phone number, and mailing address), and the NPI; and if the non-
initiating party is a provider, facility, or provider of air ambulance
services, the TIN;
(2) Information sufficient to identify the plan or issuer,
including the plan's or issuer's registration number, as required under
Sec. 2590.716-9 if the plan or issuer is registered under Sec.
2590.716-9 or an attestation from the non-initiating party that the
plan or issuer was not registered prior to the date that it submitted
the notice; the legal business name of the plan or issuer, as well as
the current contact information (name, email address, phone number, and
mailing address) of the plan or issuer as provided with the initial
payment or notice of denial of payment; and if the non-initiating party
is a plan or issuer, the plan type (for example, self-insured or fully-
insured) and TIN (or, in the case of a plan that does not have a TIN,
the TIN of the plan sponsor);
(3) The name and contact information (including the legal business
name, email address, phone number, and mailing address) for any third
party representing the non-initiating party, and an attestation that
the third party has the authority to act on behalf of the party it
represents in the Federal IDR process;
(4) Information sufficient to identify each item or service
included in the notice of IDR initiation, including the date(s) the
item or service was furnished. If the non-initiating party is a
provider, facility, or provider of air ambulance services, the date(s)
that the provider, facility, or provider of air ambulance services
received the initial payment or notice of denial of payment for such
item or service from the plan or issuer, and the claim number;
(5) If the non-initiating party is a plan or issuer, a statement as
to whether the non-initiating party agrees that the initial payment
(including $0 if, for example, payment is denied) and the qualifying
payment amount reflected in the notice of IDR initiation is accurate
for the item or service that is the subject of the dispute, and if not,
the initial payment amount (including $0 if, for example, payment is
denied) and/or qualifying payment amount it believes to be correct, and
documentation to support the statement (for example, the remittance
advice confirming the qualifying payment amount);
(6) If the non-initiating party is a plan or issuer, the amount of
cost sharing imposed for the item or service, if any;
(7) If the non-initiating party is a provider or facility, a
statement that the items and services do not qualify for the notice and
consent exception described at 45 CFR 149.410(b) or 149.420(c) through
(i);
(8) With respect to each item or service that is the subject of the
dispute, either an attestation that the item or service is a qualified
IDR item or service, or for each item or service that the non-
initiating party asserts is not a qualified IDR item or service, an
explanation and documentation to support the statement;
(9) A statement confirming that the initial payment or notice of
denial of payment or other remittance advice provided by the initiating
party under paragraph (b)(2)(ii)(A)(12) of this section is accurate,
and if inaccurate, a copy of
[[Page 75870]]
the accurate initial payment or notice of denial of payment or other
remittance advice required to include the disclosures under Sec.
2590.716-6(d)(1), with respect to the item or service;
(10) A statement as to whether any of the information provided in
the notice of IDR initiation is inaccurate and the basis for the
statement as well as any supporting documentation; and
(11) A statement as to whether the non-initiating party agrees or
objects to the initiating party's preferred certified IDR entity. If
the non-initiating party objects to the initiating party's preferred
certified IDR entity, the notice of IDR initiation response must
include the name of an alternative preferred certified IDR entity and,
if applicable, an explanation of any conflict of interest with the
initiating party's preferred certified IDR entity.
(B) [Reserved].
(3) Manner. A party furnishing notices as required under paragraphs
(b)(1)(ii) and (iii), and (b)(2)(ii) and (iii) of this section must
furnish the notices using the standard forms developed by the Secretary
and must furnish the notices and supporting documentation to the other
party and the Secretary, through the Federal IDR portal.
(c) * * *
(1) Selection of certified IDR entity--(i) Preliminary selection of
the certified IDR entity. Within 3 business days after the date of IDR
initiation, the non-initiating party must agree or object to the
preferred certified IDR entity identified in the notice of IDR
initiation, as described in paragraph (b)(2)(iii)(A)(11) of this
section.
(A) If the non-initiating party agrees, or fails to object, to the
selection of the initiating party's preferred certified IDR entity in
the manner described in paragraph (b)(2)(iii)(A)(11) of this section
and within the timeframe specified in paragraph (c)(1)(i) of this
section, the initiating party's preferred certified IDR entity will be
considered jointly selected on the third business day after the date of
IDR initiation.
(B) If the non-initiating party objects to the selection of the
initiating party's preferred certified IDR entity by designating an
alternative preferred certified IDR entity in the manner described in
paragraph (b)(2)(iii)(A)(11) of this section and within the timeframe
specified in paragraph (c)(1)(i) of this section, the initiating party
may then agree or object to the non-initiating party's alternative
preferred certified IDR entity by submitting the notice of certified
IDR entity selection in the manner specified in paragraph (c)(1)(i)(D)
of this section. If the initiating party agrees to the non-initiating
party's alternative preferred certified IDR entity within 3 business
days after the date of IDR initiation, or if the non-initiating party
submits the notice of IDR initiation response on or before the second
business day after the date of IDR initiation and the initiating party
fails to respond within 3 business days after the date of IDR
initiation, the alternative preferred certified IDR entity will be
considered jointly selected by the parties. If the non-initiating party
submits the notice of IDR initiation response on the third business day
after the date of IDR initiation and the initiating party does not
agree on the same day, selection will proceed under paragraph
(c)(1)(i)(C) of this section.
(C) If a certified IDR entity is not jointly selected under
paragraph (c)(1)(i)(A) or (B) of this section, either party may select
an alternative preferred certified IDR entity by submitting the notice
of certified IDR entity selection in the manner specified in paragraph
(c)(1)(i)(D) of this section, until the earlier of the date that the
parties agree on the alternative preferred certified IDR entity or the
deadline for joint selection, which is 3 business days after the date
of IDR initiation. Once a party submits a notice of certified IDR
entity selection, it may not submit another notice of certified IDR
entity selection until after it receives a responding notice of
certified IDR entity selection from the other party.
(1) If a party submits a notice of certified IDR entity selection
to the other party on the first or second day after the date of IDR
initiation and the party in receipt of the notice agrees or fails to
object to the alternative preferred certified IDR entity by the third
business day after the date of IDR initiation, the alternative
preferred certified IDR entity will be considered jointly selected by
the parties.
(2) If a party submits a notice of certified IDR entity selection
to the other party on the third business day after the date of IDR
initiation and the party last in receipt of the notice agrees to the
alternative preferred certified IDR entity on the same day, the
alternative preferred certified IDR entity will be considered jointly
selected by the parties.
(3) If a party submits a notice of certified IDR entity selection
to the other party on the third business day after the date of IDR
initiation and the party last in receipt of the notice does not agree
to the alternative preferred certified IDR entity on the same day, the
parties will have failed to jointly select a certified IDR entity.
(D) To notify the other party and the Secretary of an agreement or
objection to an alternative preferred certified IDR entity under
paragraph (c)(1)(i)(C) of this section, a party must submit the notice
of certified IDR entity selection. The party must furnish the notice of
certified IDR entity selection using the standard form developed by the
Secretary and must furnish the notice to the other party and the
Secretary through the Federal IDR portal within 3 business days after
the date of IDR initiation. However, in the event the conditions under
paragraph (c)(1)(ii) of this section apply, the party may notify the
Secretary of an agreement or objection to an alternative preferred
certified IDR entity in accordance with paragraph (c)(1)(ii) of this
section. The notice of certified IDR entity selection must include a
statement indicating the party's agreement with or objection to the
other party's alternative preferred certified IDR entity and, if
applicable, an explanation of any conflict of interest with the
alternative preferred certified IDR entity. If the party in receipt of
a notice of certified IDR entity selection objects to the other party's
alternative preferred certified IDR entity and the party submits a
notice of certified IDR entity selection by the end of the third
business day after the date of IDR initiation, that party's notice of
certified IDR entity selection reflecting the objection must include
the name of another alternative preferred certified IDR entity.
(ii) Failure to jointly select a certified IDR entity. If the
parties fail to jointly select a certified IDR entity within 3 business
days after the date of IDR initiation, the Secretary will select a
certified IDR entity. The parties will have failed to jointly select a
certified IDR entity if, by the end of the third business day after the
date of IDR initiation, the party last in receipt of the notice of IDR
initiation response or the notice of certified IDR entity selection has
objected to the other party's alternative preferred certified IDR
entity, or if the notice of IDR initiation response or the notice of
certified IDR entity selection is submitted to the other party on the
third business day after the date of IDR initiation and the party in
receipt of the notice does not agree to the alternative preferred
certified IDR entity within 3 business days after the date of IDR
initiation.
(A) In selecting the certified IDR entity, the Secretary will first
confirm whether a party submitted the notice of IDR initiation response
or the notice of certified IDR entity selection with an alternative
preferred certified IDR entity on the third business day after the date
of IDR initiation without the other party's agreement to the selection.
If
[[Page 75871]]
either notice was provided on the third business day after the date of
IDR initiation without the other party's agreement to the alternative
preferred certified IDR entity by the end of third business day after
the date of IDR initiation, the Secretary will provide the party last
in receipt of the applicable notice 2 additional business days to agree
or object to the other party's alternative preferred certified IDR
entity selection.
(1) If the party last in receipt of the notice of IDR initiation
response or the notice of certified IDR entity selection agrees with
the other party's alternative preferred certified IDR entity and
notifies the Secretary of the agreement or fails to notify the
Secretary of its objection in the Federal IDR portal by the fifth
business day after the date of IDR initiation, the Secretary will
select the final alternative preferred certified IDR entity selected in
the applicable notice. In disputes where the applicable notice was
submitted on the third business day after the date of IDR initiation,
the party last in receipt of the notice will not be allowed to select
another alternative preferred certified IDR entity.
(2) If the party notifies the Secretary of its objection to the
alternative preferred certified IDR entity by the fifth business day
after the date of IDR initiation, the Secretary will proceed with the
random selection of the certified IDR entity from among the certified
IDR entities (other than the preferred certified IDR entity and any
alternative preferred certified IDR entity previously selected in such
dispute by a party, unless there is no other certified IDR entity
available to select) that charge a fee within the allowed range of
certified IDR entity fees on the sixth business day after the date of
IDR initiation. If there are insufficient certified IDR entities that
charge a fee within the allowed range of certified IDR entity fees
available to arbitrate the dispute, the Secretary will select a
certified IDR entity that has received approval, as described in
paragraph (e)(2)(vii)(B) of this section, to charge a fee outside of
the allowed range of certified IDR entity fees. In either case, the
Secretary will notify the parties of the preliminary selection of the
certified IDR entity not later than 6 business days after the date of
IDR initiation.
(B) [Reserved].
(iii) Date of preliminary selection of the certified IDR entity.
The date of preliminary selection of the certified IDR entity will be:
(A) Three business days after the date of IDR initiation if the
parties jointly selected a certified IDR entity, as specified in
paragraph (c)(1)(i) of this section; or
(B) Six business days after the date of IDR initiation, if the
parties fail to jointly select a certified IDR entity as specified in
paragraph (c)(1)(ii) of this section.
(iv) Final selection of the certified IDR entity--(A) Conflict-of-
interest review. The certified IDR entity preliminarily selected for a
dispute must review the selection. The selection of the certified IDR
entity will be finalized only if the certified IDR entity attests to
the Secretary that it meets the following requirements:
(1) The certified IDR entity does not have a conflict of interest
as defined in paragraph (a)(2)(iv) of this section;
(2) The certified IDR entity will only assign personnel to a
dispute and make decisions regarding hiring, compensation, termination,
promotion, or other similar matters related to personnel assigned to
the dispute in a manner that is not based upon the likelihood that the
assigned personnel will support a particular party to the dispute; and
(3) The certified IDR entity will not assign any personnel to a
dispute who would have any conflicts of interest, as defined in
paragraph (a)(2)(iv) of this section, regarding any party to the
dispute or whose relationship with a party within the 1 year
immediately preceding the assignment to the dispute would violate the
restrictions on aiding or advising a former employer or principal in a
manner similar to the restrictions set forth in 18 U.S.C. 207(b).
(B) Failure to meet conflict-of-interest requirements. If the
certified IDR entity notifies the Secretary within 3 business days of
the date of preliminary selection of the certified IDR entity that it
does not meet the requirements of paragraphs (c)(1)(iv)(A)(1) through
(3) of this section or if the certified IDR entity does not respond
within 3 business days after the date of preliminary selection of the
certified IDR entity, the Secretary will randomly select another
certified IDR entity consistent with paragraph (c)(1)(ii) of this
section. The Secretary will notify the parties of the new randomly
preliminarily selected certified IDR entity no later than 1 business
day after the previously selected certified IDR entity notifies the
Secretary that it has a conflict of interest or, if the previously
selected certified IDR entity fails to respond within 3 business days
after the date of preliminary selection of the certified IDR entity, no
later than 1 business day after the end of the 3-business-day period.
(C) Date of final selection of the certified IDR entity. If the
certified IDR entity that has been preliminarily selected attests
within 3 business days that it meets the requirements of paragraphs
(c)(1)(iv)(A)(1) through (3) of this section, the Secretary will notify
the parties of final selection of the certified IDR entity no later
than 1 business day after the certified IDR entity attests that it
meets the conflict-of-interest requirements. The date of final
selection of the certified IDR entity is the date that the Secretary
provides this notice to the parties.
(2) Federal IDR process eligibility review--(i) Federal IDR process
eligibility determination by certified IDR entity. Unless the
departmental eligibility review described in paragraph (c)(2)(ii) of
this section applies, the selected certified IDR entity must review the
information in the notice of IDR initiation, notice of IDR initiation
response, and any additional information described in paragraph
(c)(2)(iii) of this section, and make a final determination as to
whether the item or service is a qualified IDR item or service, as
defined in paragraph (a)(2)(xi) of this section, that is eligible for
the Federal IDR process. The certified IDR entity must make such a
determination and notify the Secretary and both parties no later than 5
business days after the date of final selection of the certified IDR
entity. If the certified IDR entity determines that the item or service
is not a qualified IDR item or service, the dispute will be closed, and
the selected certified IDR entity will not take any action with regard
to the dispute.
(ii) Departmental eligibility review for Federal IDR process
eligibility determinations. When the conditions for the departmental
eligibility review set forth in paragraph (c)(2)(ii)(A) of this section
are met, the Secretary will conduct the eligibility review and make the
eligibility determination instead of the certified IDR entity. If the
Secretary determines that the item or service is not a qualified IDR
item or service, the dispute will be closed, and the selected certified
IDR entity will not take any action with regard to the dispute. If the
dispute is found to be eligible, the Secretary will inform the
preliminarily selected certified IDR entity of the dispute's
eligibility so that it may conduct its conflict-of-interest assessment,
and the dispute will otherwise continue through the Federal IDR
process, including notification of the eligibility determination to the
disputing parties by the preliminarily selected certified IDR entity.
[[Page 75872]]
(A) Application of the departmental eligibility review. The
departmental eligibility review will apply when the Secretary
determines that any of the extenuating circumstances described in
paragraph (g)(1) of this section require application of the
departmental eligibility review to facilitate timely payment
determinations or the effective processing of disputes under the
Federal IDR process.
(B) Notification regarding applicability of the departmental
eligibility review. Before invoking the application of the departmental
eligibility review, the Secretary will post advance public notification
of the date on which the departmental eligibility review will take
effect and the reasons for invoking the application of the departmental
eligibility review. Before ending the application of the departmental
eligibility review, the Secretary will post advance public notification
of the date on which the departmental eligibility review will no longer
be in effect and the reasons for ending the application of the
departmental eligibility review.
(iii) Request for additional information. The Secretary or the
selected certified IDR entity may request additional information from
either party to a dispute at any time, including for the purpose of
assessing whether a conflict of interest exists, conducting an
eligibility determination, or making a payment determination.
(A) Upon request, a party must submit the additional information
within 5 business days to the Secretary or the selected certified IDR
entity, as applicable, through the Federal IDR portal. Following a
request for additional information, the time period for the applicable
stage of the Federal IDR process will be tolled until the earlier of
the date either all of the requested information is provided or the 5-
business-day period expires, and each subsequent timeframe in the
Federal IDR process will be determined based on the date of completion
of the stage of the Federal IDR process that was tolled for provision
of the requested information.
(B) If a party fails to submit the additional information as
required, the related determination, including the eligibility
determination, conflict-of-interest review, or payment determination
will be made without the requested information unless a good-cause
extension of the 5-business-day period, as specified in paragraph
(g)(1)(i) of this section, has been provided, and the party
subsequently submits the additional information requested within the
extended period.
(3) Authority to continue negotiations or withdraw--(i) Authority
to continue to negotiate. If the parties to the Federal IDR process
agree on an out-of-network rate for a qualified IDR item or service
after providing the notice of IDR initiation to the Secretary required
under paragraph (b)(2)(ii) of this section, but before the certified
IDR entity has made its payment determination, the amount agreed to by
the parties for the qualified IDR item or service will be treated as
the out-of-network rate for the qualified IDR item or service. To the
extent the amount exceeds the initial payment amount and any cost
sharing paid or required to be paid by the participant or beneficiary,
or there was an initial denial of payment, payment must be made
directly by the plan or issuer to the nonparticipating provider,
nonparticipating facility, or nonparticipating provider of air
ambulance services not later than 30 business days after the agreement
is reached. In no instance may either party seek additional payment
from the participant or beneficiary, including in instances in which
the out-of-network rate exceeds the qualifying payment amount. The
initiating party must send a notification to the Secretary and to the
certified IDR entity (if selected) electronically, through the Federal
IDR portal, as soon as possible, but no later than 3 business days
after the date of the agreement. The notification must include the
dispute number, a statement of the out-of-network rate for the
qualified IDR item or service, and signatures from authorized
signatories for both parties.
(ii) Withdrawals. A dispute may be withdrawn from the Federal IDR
process by the initiating party, the Secretary, or a certified IDR
entity before a payment determination is made if one of the following
conditions is met:
(A) The initiating party provides notification through the Federal
IDR portal to the Secretary and the certified IDR entity (if selected)
that both parties to the dispute agree to withdraw the dispute from the
Federal IDR process without agreement on an out-of-network rate. The
notification must include the dispute number, a statement about both
parties' agreement to withdraw and signatures from authorized
signatories for both parties.
(B) The initiating party provides a standard withdrawal request
notice through the Federal IDR portal to the Secretary, the certified
IDR entity (if selected), and the non-initiating party of its request
to withdraw the dispute from the Federal IDR process and the non-
initiating party notifies the Secretary, certified IDR entity (if
selected), and the initiating party through the Federal IDR portal of
its agreement to withdraw from the Federal IDR process within 5
business days of the initiating party's request. If the non-initiating
party fails to respond within 5 business days of the initiating party's
request, the non-initiating party will be considered to have agreed to
the withdrawal, and the dispute will be withdrawn.
(C) The certified IDR entity or Secretary cannot determine
eligibility because both parties to the dispute are unresponsive to any
requests for additional information to determine eligibility as
described in paragraph (c)(2)(iii) of this section, or
(D) The certified IDR entity cannot make a payment determination
because both parties to the dispute have failed to submit an offer as
described in paragraph (c)(5)(i) of this section.
(4) Treatment of batched qualified IDR items and services--(i) In
general. A certified IDR entity may consider up to 25 qualified IDR
items and services jointly as part of one payment determination that is
subject to the certified IDR entity fee for batched determinations only
if the qualified IDR items and services meet the requirements of this
paragraph (c)(4)(i):
* * * * *
(B) Payment for the qualified IDR items and services is required to
be made by the same group health plan or health insurance issuer. For
group or individual health insurance coverage, this requirement is
satisfied if the same issuer is required to make payment for the
qualified IDR items and services, even if the qualified IDR items and
services relate to claims from different group health plans or
individual market policies. For self-insured group health plans, this
requirement is satisfied if the same self-insured group health plan is
required to make payment for the qualified IDR items and services,
including when the plan makes payments through a third party
administrator; the requirement is not satisfied if multiple self-
insured group health plans are required to make payments for the
qualified IDR items and services, even if those group health plans make
payments through the same third party administrator;
(C) The qualified IDR items and services meet any of the following
criteria under which multiple qualified IDR items and services relate
to the treatment of a similar condition and therefore are permitted to
be considered jointly as a single payment determination for purposes of
encouraging efficiencies (including minimizing costs) in the Federal
IDR process:
[[Page 75873]]
(1) The qualified IDR items or services were furnished to a single
patient during the same patient encounter. For purposes of this
section, a single patient encounter is defined as a patient encounter
on one or more consecutive days during which the qualified IDR items or
services were furnished to the same patient and billed on the same
claim form; or
(2) The qualified IDR items and services were furnished to one or
more patients and were billed under the same service code or a
comparable code under a different procedural coding system, such as
Current Procedural Terminology (CPT) codes with modifiers, if
applicable, Healthcare Common Procedure Coding System (HCPCS) codes
with modifiers, if applicable, or Diagnosis-Related Group (DRG) codes
with modifiers, if applicable; or
(3) For anesthesiology, radiology, pathology, and laboratory
qualified IDR items and services, the qualified IDR items and services
were furnished to one or more patients and were billed under service
codes belonging to the same Category I CPT code range, as specified in
guidance published by the Secretary; and
(D) All the qualified IDR items and services were furnished within
the same 30-business-day period following the date on which the first
item or service included in the batched determination was furnished and
were the subjects of a 30-business-day open negotiation period that
ended within 4 business days of IDR initiation, except as provided in
paragraph (c)(5)(vii) of this section.
(ii) Treatment of bundled payment arrangements. Qualified IDR items
and services that meet the definition of a bundled payment arrangement
under Sec. 2590.716-3 may be submitted and considered as a single
payment determination, and the certified IDR entity must make a single
payment determination for the multiple qualified IDR items and services
included in the bundled payment arrangement. Bundled payment
arrangements as defined in Sec. 2590.716-3 and submitted under this
paragraph (c)(4)(ii) are subject to the certified IDR entity fee for
single determinations.
(5) * * *
(i) Submission of offers. Not later than 10 business days after the
date of final selection of the certified IDR entity as described in
paragraph (c)(1)(iv)(C) of this section (or not later than 10 business
days after the qualified IDR items and services are determined eligible
as described in paragraph (c)(2) of this section, when the Secretary
determines that any of the extenuating circumstances described in
paragraph (g)(1)(ii) of this section apply), the plan or issuer and the
provider, facility, or provider of air ambulance services:
* * * * *
(ii) Payment determination and notification. Not later than 30
business days after the date of final selection of the certified IDR
entity as described in paragraph (c)(1)(iv)(C) of this section (or not
later than 30 business days after the qualified IDR items and services
are determined eligible as described in paragraph (c)(2) of this
section, when the Secretary determines that any of the extenuating
circumstances described in paragraph (g) of this section apply), the
certified IDR entity must:
(A) * * *
(1) Prevailing party. In the case of single determinations, the
party whose offer is selected by the certified IDR entity is considered
the prevailing party. In the case of batched determinations, the party
with the most determinations in its favor is considered the prevailing
party; if each party prevails in an equal number of determinations,
neither party will be considered the prevailing party, and the
certified IDR entity fee will be split evenly between the parties.
(2) Non-prevailing party. In the case of single determinations, the
party whose offer is not selected by the certified IDR entity is
considered the non-prevailing party. In the case of batched
determinations, the party with the fewest determinations in its favor
is considered the non-prevailing party.
* * * * *
(vii) Effects of determination.
(A) * * *
(B) Suspension of certain subsequent IDR requests. In the case of a
determination made by a certified IDR entity under paragraph (c)(5)(ii)
of this section, the party that submitted the initial notification
under paragraph (b)(2) of this section may not submit a subsequent
notification involving the same other party with respect to a claim for
the same item or service that was the subject of the initial
notification during the 90-calendar-day period following the
determination.
(C) Subsequent submission of requests permitted. If the end of the
open negotiation period specified in paragraph (b)(1) of this section
occurs during the 90-calendar-day suspension period regarding claims
for the same item or service that were the subject of the initial
notice of IDR determination as described in paragraph (c)(5)(vi) of
this section, either party may initiate the Federal IDR process for
those claims by submitting a notification as specified in paragraph
(b)(2) of this section during the 30-business-day period beginning on
the day after the last day of the 90-calendar-day suspension period.
* * * * *
(d) Costs of IDR process--(1) Certified IDR entity fee--(i) Timing
of payment of certified IDR entity fee. Each party to a dispute for
which there is a final selection of the certified IDR entity and a
determination that the dispute is eligible for the Federal IDR process
in accordance with paragraph (c)(2) of this section must pay to the
certified IDR entity the predetermined certified IDR entity fee charged
by the certified IDR entity. The certified IDR entity fee must be paid
no later than the date a party submits its offer to the certified IDR
entity, in accordance with paragraph (c)(5)(i) of this section.
(ii) Failure to timely pay certified IDR entity fee. If a party
fails to pay the certified IDR entity fee as specified in paragraph
(d)(1)(i) of this section, that party's offer will not be considered
received. Such party will continue to be responsible for payment of the
certified IDR entity fee.
(iii) Method of allocation of the certified IDR entity fee after a
payment determination. After making a payment determination, the
certified IDR entity shall retain the certified IDR entity fee
described under paragraph (d)(1)(i) of this section paid by the non-
prevailing party as defined in paragraph (c)(5)(ii)(A)(2) of this
section. The certified IDR entity must return the fee paid by the
prevailing party, as defined in paragraph (c)(5)(ii)(A)(1) of this
section, within 30 business days following the date of the certified
IDR entity's payment determination. In the event of a batched dispute
in which each party prevails in an equal number of determinations, the
certified IDR entity fee will be split evenly between the parties. In
that case, the certified IDR entity must return half the fee paid by
each party within 30 business days following the date of the certified
IDR entity's payment determination.
(iv) Method of allocation of the certified IDR entity fee upon
agreement or withdrawal after an eligibility determination. For a
dispute for which there is a final selection of the certified IDR
entity and a determination that the dispute is eligible for the Federal
IDR process in accordance with paragraph (c)(2) of this section, unless
directed otherwise by both parties, the certified IDR entity is
required to return half of each party's certified IDR entity fee within
30 business days of the date both parties notify the certified IDR
entity that they have:
[[Page 75874]]
(A) Reached an agreement on an out-of-network rate for qualified
IDR items or services before the certified IDR entity has made its
payment determination, as described in paragraph (c)(3)(i) of this
section; or
(B) Withdrawn the dispute before the certified IDR entity has made
its payment determination, as described in paragraph (c)(3)(ii) of this
section.
(v) Method of allocation of the certified IDR entity fee upon
agreement or withdrawal before an eligibility determination. When the
parties reach an agreement on an out-of-network rate or withdraw a
dispute for which there is a final selection of the certified IDR
entity, but for which no eligibility determination has yet been made,
unless directed otherwise by both parties, the certified IDR entity is
required to return each party's full certified IDR entity fee within 30
business days of the date both parties notify the certified IDR entity
that they have agreed on an out-of-network rate or agreed to withdraw
the dispute.
(2) Administrative fee--(i) In general. Each party to a dispute for
which a certified IDR entity is selected under paragraph (c)(1) of this
section must pay a non-refundable administrative fee to the Secretary
for participating in the Federal IDR process.
(A) Timing of payment of administrative fee. The initiating party
must pay the administrative fee within 2 business days of the date of
preliminary selection of the certified IDR entity as described in
paragraph (c)(1)(iii) of this section. The non-initiating party must
pay the administrative fee within 2 business days of the date the non-
initiating party receives notice that an eligibility determination for
the Federal IDR process has been reached by either the certified IDR
entity or the Departments in accordance with paragraph (c)(2) of this
section.
(B) Agreements and withdrawals. In the case of an agreement, as
described in paragraph (c)(3)(i) of this section, or a withdrawal, as
described in paragraph (c)(3)(ii) of this section, the administrative
fee will not be returned to the parties if preliminary selection of the
certified IDR entity has occurred, as described in paragraph (c)(1)(i)
of this section; if not yet collected, the administrative fee must
still be paid, except as provided in paragraph (d)(2)(i)(C) of this
section for a dispute closed for nonpayment by an initiating party.
(C) Failure to pay administrative fee. If the initiating party
fails to pay the administrative fee in accordance with paragraph
(d)(2)(i)(A) of this section, the dispute will be closed due to
nonpayment and neither party will be responsible for the administrative
fee. If the non-initiating party fails to pay the administrative fee in
accordance with paragraph (d)(2)(i)(A) of this section, that party's
offer will not be considered received and the non-initiating party will
continue to be responsible for payment of the administrative fee.
(D) Collection of unpaid fees. Any party that fails to pay the
administrative fee owed in accordance with paragraph (d)(2)(i)(A) of
this section is obligated to pay the administrative fee otherwise due
and owing, except as provided in paragraph (d)(2)(i)(C) of this section
for a dispute closed for nonpayment by an initiating party. The
Secretary will pursue collection from a party to a dispute of any
administrative fee that is not timely paid pursuant to applicable debt
collection authorities.
(ii) Administrative fee amount. The administrative fee amount and
method of payment will be established through notice and comment
rulemaking in a manner such that the total administrative fees paid for
a year, including administrative fees reduced under paragraph
(d)(2)(iii) of this section, are estimated to be equal to the projected
amount of expenditures made by the Secretaries of the Treasury, Labor,
and Health and Human Services for the year in carrying out the Federal
IDR process.
(A) For disputes initiated on or after the later of the effective
date of Federal Independent Dispute Resolution (IDR) Process
Administrative Fee and Certified IDR Entity Fee Ranges final rules or
January 1, 2024, the administrative fee amount is $150 per party per
dispute, which will remain in effect until changed by subsequent
rulemaking.
(B) [Reserved]
(iii) Reducing the administrative fee amount. For disputes
initiated on or after January 1, 2025--
(A) The Secretary may reduce the administrative fee for both
parties in accordance with paragraph (d)(2)(iii)(C) of this section
when the highest offer made by either party during open negotiation for
the dispute is less than the threshold established in notice and
comment rulemaking pursuant to paragraph (d)(2)(ii) of this section.
For a dispute that satisfies the requirements for a reduced
administrative fee in accordance with this paragraph and for which a
determination has been made that the dispute is eligible for the
Federal IDR process in accordance with paragraph (c)(2) of this
section, the administrative fee amount may be reduced to 50 percent of
the administrative fee amount as described in paragraph (d)(2)(ii) of
this section for each party to the dispute. For a dispute that
satisfies the requirements for a reduced administrative fee in
accordance with this paragraph and for which a determination has been
made that the dispute is ineligible for the Federal IDR process in
accordance with paragraph (c)(2) of this section, the administrative
fee amount may be reduced to 50 percent of the administrative fee
amount as described in paragraph (d)(2)(ii) of this section for the
initiating party and to 20 percent of the administrative fee amount for
the non-initiating party.
(B) The Secretary may reduce the administrative fee for a non-
initiating party in accordance with paragraph (d)(2)(iii)(C) of this
section when the dispute is determined to be ineligible for the Federal
IDR process in accordance with paragraph (c)(2) of this section. For a
dispute that satisfies the requirements for a reduced administrative
fee in accordance with this paragraph, the administrative fee amount
for the non-initiating party may be reduced to 20 percent of the
administrative fee amount as described in paragraph (d)(2)(ii) of this
section.
(C) The reduced administrative fee amounts provided for in
paragraphs (d)(2)(iii)(A) and (d)(2)(iii)(B) of this section shall be
established in notice and comment rulemaking and will remain in effect
until changed by subsequent rulemaking, pursuant to paragraph
(d)(2)(ii) of this section.
(e) * * *
(2) * * *
(vi) Meet appropriate indicators of fiscal integrity and stability
by demonstrating that the certified IDR entity has a system of
safeguards and controls in place to prevent and detect improper
financial activities by its employees and agents to assure fiscal
integrity and accountability for all certified IDR entity fees and
administrative fees (if applicable) received, held, and disbursed and
by submitting 3 years of financial statements or, if not available,
other information to demonstrate fiscal stability of the certified IDR
entity;
* * * * *
(viii) Have a procedure in place to retain the certified IDR entity
fees described in paragraph (d)(1) of this section paid by both parties
in a trust or escrow account and to return the certified IDR entity fee
paid by the prevailing party or a portion of each party's certified IDR
entity fee in the case of an agreement described in paragraph (c)(3)(i)
of this section, a
[[Page 75875]]
withdrawal described in paragraph (c)(3)(ii) of this section, or a
circumstance described under paragraph (d)(1)(iii) of this section,
within 30 business days following the date of the determination;
(ix) Have a procedure in place to retain the administrative fees
(if applicable) described in paragraph (d)(2) of this section and to
remit the administrative fees to the Secretary in accordance with the
timeframe and procedures set forth in guidance published by the
Secretary;
* * * * *
(g) Extension of time periods for extenuating circumstance--(1) In
general. The time periods specified in this section (other than the
time for payment, if applicable, under paragraph (c)(5)(ix) of this
section) may be extended in extenuating circumstances at the
Secretary's discretion. Extenuating circumstances include, but are not
limited to when:
(i) With respect to a specific dispute, the Secretary determines
that the parties or certified IDR entity cannot meet applicable
timeframes due to matters beyond the control of one or both parties or
the certified IDR entity, or for other good cause. The certified IDR
entity or either party may also submit a request for an extension due
to extenuating circumstances to the Secretary through the Federal IDR
portal. The requesting certified IDR entity or party must attest that
it will take prompt action to ensure that the certified IDR entity's
payment determination under this section may be made as soon as
administratively practicable under the circumstances; or
(ii) The Secretary determines that the parties or certified IDR
entity cannot meet applicable timeframes due to systematic delays in
processing disputes under the Federal IDR process, such as an
unforeseen volume of disputes or Federal IDR portal system failures.
Extensions provided due to extenuating circumstances caused by an
unforeseen volume of disputes will be applied to the timeframe for
eligibility determinations under paragraph (c)(2) of this section.
Extensions provided due to extenuating circumstances caused by systems
failures within the Federal IDR portal will be applied to the Federal
IDR process timeframe(s) determined relevant by the Secretary. The
Secretary will post a public notice regarding any extensions of time
periods pursuant to this paragraph (g)(1)(ii).
(A) Timeframe following an extension to eligibility determination.
When an extension to the eligibility determination timeframe pursuant
to paragraph (g)(1)(ii) of this section is in effect, the start date of
the subsequent timeframes in the Federal IDR process will be determined
based on the date of completion of the eligibility determination by the
certified IDR entity or the Secretary.
(1) Submission of offers. The parties must submit their offers and
certified IDR entity fees to the certified IDR entity not later than 10
business days after the qualified IDR items and services are determined
eligible as described in paragraph (c)(2) of this section.
(2) Payment Determination. The certified IDR entity must make the
payment determination and notification of the payment determination to
the parties not later than 30 business days after the qualified IDR
items and services are determined eligible as described in paragraph
(c)(2) of this section.
(B) Timeframe following an extension to other timeframes in the
Federal IDR process. When an extension to any timeframe within the
Federal IDR process, other than the eligibility timeframe, is in effect
pursuant to paragraph (g)(1)(ii) of this section, the start date of
each subsequent timeframe in the Federal IDR process will be determined
based on the date of completion of the process for which the extension
was granted.
(2) [Reserved]
(h) Applicability date. (1) Paragraph (a) of this section is
applicable with respect to plan years beginning on or after January 1,
2022, except that the provisions regarding IDR entity certification at
paragraphs (a) and (e) of this section are applicable beginning on
October 7, 2021, and the revised definition for batched qualified IDR
items and services at paragraph (a)(2)(i) of this section is applicable
to disputes with open negotiation periods beginning on or after the
later of August 15, 2024, or 90 days after the effective date of the
rule.
(2) Paragraph (b) of this section is applicable to disputes with
open negotiation periods beginning on or after the later of August 15,
2024, or 90 days after the effective date of the rule.
(3) Paragraph (c)(1) of this section, regarding the selection of a
certified IDR entity, is applicable to disputes with open negotiation
periods beginning on or after the later of August 15, 2024, or 90 days
after the effective date of the rule, except that paragraphs
(c)(1)(iv)(A)(1) through (3) of this section, regarding the conflict-
of-interest standards, are applicable with respect to plan years
beginning on or after January 1, 2022.
(4) Paragraph (c)(2) of this section, regarding the Federal IDR
process eligibility review and paragraph (c)(3) of this section
regarding the authority to continue negotiations or withdraw are
applicable to disputes with open negotiation periods beginning on or
after the later of August 15, 2024, or 90 days after the effective date
of the rule, and paragraph (c)(4) of this section regarding the
treatment of batched and bundled qualified IDR items and services is
applicable 90 days after the effective date of the rule.
(5) Paragraphs (c)(5)(i) and (ii), and (c)(5)(vii)(B) and (C) of
this section regarding the deadlines for the submission of offers,
payment determination and notification, suspension of certain
subsequent IDR requests, and subsequent submission of requests
submitted are applicable to disputes with open negotiation periods
beginning on or after the later of August 15, 2024, or 90 days after
the effective date of the rule. Paragraphs (c)(5)(iii) and (iv) of this
section regarding considerations in payment determinations and the
related examples and paragraph (c)(5)(vi)(B) of this section regarding
written decisions are applicable with respect to items or services
furnished on or after October 25, 2022, for plan years beginning on or
after January 1, 2022. Paragraphs (c)(5)(v) through (c)(5)(vi)(A),
(c)(5)(vii)(A), and (c)(5)(viii) and (ix) are applicable with respect
to plan years beginning on or after January 1, 2022.
(6) Paragraph (d) of this section regarding the costs of the IDR
process is applicable to disputes initiated on or after January 1,
2025.
(7) Paragraph (e) of this section is applicable with respect to
plan years beginning on or after January 1, 2022, except that the
provisions regarding IDR entity certification at paragraphs (e)(1),
(e)(2)(i) through (vi), (e)(2)(x) and (xi), and (e)(3) through (6) of
this section are applicable beginning on October 7, 2021. Paragraphs
(e)(2)(vi), (viii), and (ix) of this section regarding the certified
IDR entity's controls to prevent and detect improper financial
activities, and procedures to retain the certified IDR entity fee and
administrative fee are applicable upon the effective date of the rule.
(8) Paragraph (f) of this section is applicable with respect to
plan years beginning on or after January 1, 2022, except that paragraph
(f)(1)(v)(F) of this section regarding reporting of information
relating to the Federal IDR process is applicable with respect to items
or services furnished on or after October 25, 2022, for plan years
beginning on or after January 1, 2022.
[[Page 75876]]
(9) Paragraph (g) of this section regarding the extension of time
periods for extenuating circumstances is applicable to disputes with
open negotiation periods beginning on or after the later of August 15,
2024, or 90 days after the effective date of the rule.
(10) Until the relevant applicability date for the requirements of
this section, plans, issuers, providers, facilities, providers of air
ambulance services and certified IDR entities are required to continue
to comply with the corresponding section of Sec. 2590.716-8 in effect
on October 25, 2022.
(i) Severability. (1) Any provision of this section held to be
invalid or unenforceable by its terms, or as applied to any person or
circumstance, shall be construed so as to continue to give maximum
effect to the provision permitted by law, unless such holding shall be
one of utter invalidity or unenforceability, in which event the
provision shall be severable from this section and shall not affect the
remainder thereof or the application of the provision to persons not
similarly situated or to dissimilar circumstances.
(2) The provisions of paragraphs (b)(1), (c)(2)(ii), (c)(4),
(d)(2), and (g)(1) of this section are intended to be severable from
one another, from any grant of forbearance from removal resulting from
this subpart, and from any provision referenced in those paragraphs.
The provisions in Sec. 2590.716-8 are intended to be severable from
the provisions in Sec. Sec. 2590.716-6A, 2590.716-6, and 2590.716-9,
from any grant of forbearance from removal resulting from this subpart,
and from any provision referenced in Sec. Sec. 2590.716-6A, 2590.716-
6, and 2590.716-9.
0
17. Section 2590.716-9 is added to subpart F to read as follows:
Sec. 2590.716-9 Federal Independent Dispute Resolution Registry of
Group Health Plans, Health Insurance Issuers, and Federal Employees
Health Benefits Carriers.
(a) Establishment of Federal independent dispute resolution
registry. The Secretary, jointly with the Secretary of the Treasury and
the Secretary of Health and Human Services, will establish a Federal
IDR registry consisting of the information described in paragraph
(b)(2) of this section and will assign a registration number for each
group health plan, health insurance issuer offering group or individual
health insurance coverage, and Federal Employees Health Benefits (FEHB)
Program carrier. The information contained in the registry will be made
available to parties seeking to initiate an open negotiation or a
dispute through the Federal IDR portal, and will be searchable,
including by registration number.
(b) Federal IDR registration--(1) Registration requirement. Each
group health plan and health insurance issuer offering group health
insurance coverage subject to the Federal IDR process must register
with the Federal IDR registry as specified by the Secretary in
guidance. Initial registration must be completed by the later of the
date that is 30 business days after the effective date of the final
rule, the date that is 30 business days after the registry becomes
available, or the date the group health plan or health insurance issuer
begins offering a group health plan or health insurance coverage
subject to the Federal IDR process.
(2) Required data elements. Group health plans and health insurance
issuers offering group health insurance coverage subject to the
registration requirement must include the following information with
their registration:
(i) The legal business name (if any) of the group health plan, or
issuer, and, if applicable, the legal business name of the group health
plan sponsor;
(ii) Whether the plan or coverage is a self- or fully-insured group
health plan subject to ERISA;
(iii) The State(s) in which the plan or coverage is subject to a
specified State law, as defined in Sec. 2590.716-3 for any items or
services for which the protections of Sec. Sec. 2590.716-4, 2590.716-
5, and 2590.717-1 apply;
(iv) The State(s) in which the plan or coverage is subject to an
All-Payer Model Agreement under section 1115A of the Social Security
Act for any items or services to which the protections in Sec. Sec.
2590.716-4, 2590.716-5, and 2590.717-1 apply;
(v) For self-insured group health plans not otherwise subject to
State law, any State(s) in which the group health plan has properly
effectuated an election to opt in to a specified State law as defined
in Sec. 2590.716-3, if that State allows a plan not otherwise subject
to the State law to opt-in;
(vi) Contact information, including a telephone number and email
address, for the appropriate person or office to initiate open
negotiations for purposes of determining an amount of payment
(including cost sharing) for such item or service;
(vii) The 14-digit Health Insurance Oversight System (HIOS)
identifier; or if the 14-digit HIOS identifier has not been assigned,
the 5-digit HIOS identifier; or if no HIOS identifier is available, the
plan's or the plan sponsor's Employer Identification Number (EIN) and
the plan's plan number (PN), if a PN is available;
(viii) Additional information needed to identify the plan or issuer
and the applicable Federal and State requirements for determining
appropriate out-of-network payment rates for items or services to which
the protections against balance billing in this part apply, as
specified by the Secretary in guidance; and
(ix) Additional information needed for purposes of administrative
fee collection, as specified by the Secretary in guidance.
(3) Updating disclosures. A plan or issuer must timely report to
the Secretary changes to the information required under this section
within 30 calendar days after the information changes. A plan or issuer
must confirm the accuracy of its registration annually in the fourth
quarter of each calendar year.
(4) Third party authority. The requirements of paragraphs (b)(1)
through (3) of this section may be performed by a third party
administrator or service provider with authority to act on behalf of
the group health plan or health insurance issuer offering group health
insurance coverage subject to the Federal IDR process. If the
registration requirements are performed by such third party
administrator or service provider the group health plan or health
insurance issuer offering group or individual health insurance coverage
must require that such third party administrator or service provider
clearly delineate each group health plan or health insurance issuer
offering group health insurance coverage for which it has authority to
act. If such third party administrator or service provider fails to
provide the information in compliance with the requirements of
paragraphs (b)(1) through (3) of this section the plan or issuer will
be in violation of the requirements of this section.
(c) Severability. (1) Any provision of this section held to be
invalid or unenforceable by its terms, or as applied to any person or
circumstance, shall be construed so as to continue to give maximum
effect to the provision permitted by law, unless such holding shall be
one of utter invalidity or unenforceability, in which event the
provision shall be severable from this section and shall not affect the
remainder thereof or the application of the provision to persons not
similarly situated or to dissimilar circumstances.
(2) The provisions in Sec. 2590.716-9 are intended to be severable
from the provisions in Sec. Sec. 2590.716-6A, 2590.716-6, and
2590.716-8, from any grant of forbearance from removal
[[Page 75877]]
resulting from this subpart, and from any provision referenced in
Sec. Sec. 2590.716-6A, 2590.716-6, and 2590.716-8.
DEPARTMENT OF HEALTH AND HUMAN SERVICES
For the reasons stated in the preamble, the Department of Health
and Human Services proposes to amend 45 CFR part 149 as set forth
below:
PART 149--SURPRISE BILLING AND TRANSPARENCY REQUIREMENTS
0
18. The authority citation for part 149 continues to read as follows:
Authority: 42 U.S.C. 300gg-92 and 300gg-111 through 300gg-139,
as amended.
Subpart A--General Provisions
0
19. Section 149.30 is amended by adding the definition of ``Bundled
payment arrangement'' in alphabetical order to read as follows:
Sec. 149.30 Definitions.
* * * * *
Bundled payment arrangement means an arrangement under which--
(1) A provider, facility, or provider of air ambulance services
bills for multiple items or services furnished to a single patient
under a single service code that represents multiple items or services
(for example, a Diagnosis-Related Group (DRG) code); or
(2) A plan or issuer makes an initial payment or notice of denial
of payment to a provider, facility, or provider of air ambulance
services under a single service code that represents multiple items or
services furnished to a single patient (for example, a DRG code).
* * * * *
Subpart B--Requirements Relating to Health Care Access
0
20. Section 149.100 is added to subpart B to read as follows:
Sec. 149.100 Use of claim adjustment reason codes and remittance
advice remark codes.
(a) In general. When providing any paper or electronic remittance
advice to an entity that does not have a contractual relationship
directly or indirectly with a group health plan or a health insurance
issuer offering group or individual health insurance coverage with
respect to the furnishing of the item or service under the plan or
coverage in response to a claim for payment for health care items and
services furnished by that entity, the plan or issuer must use claim
adjustment reason codes (CARCs) and remittance advice remark codes
(RARCs) (see 45 CFR 162.1602 and 162.1603) as specified in guidance
issued by the Secretaries of the Treasury, Labor, and Health and Human
Services, or as required under any applicable adopted standards and
operating rules under 45 CFR part 162, to communicate information
related to whether the claim is or is not subject to the provisions of
this subpart and subparts E and F of this part.
(b) Severability. (1) Any provision of this section held to be
invalid or unenforceable by its terms, or as applied to any person or
circumstance, shall be construed so as to continue to give maximum
effect to the provision permitted by law, unless such holding shall be
one of utter invalidity or unenforceability, in which event the
provision shall be severable from this section and shall not affect the
remainder thereof or the application of the provision to persons not
similarly situated or to dissimilar circumstances.
(2) The provisions in Sec. 149.100 are intended to be severable
from the provisions in Sec. Sec. 149.140, 149.510, and 149.530, from
any grant of forbearance from removal resulting from this subpart, and
from any provision referenced in Sec. Sec. 149.140, 149.510, and
149.530.
0
21. Section 149.140 is amended by:
0
a. Revising paragraphs (d) introductory text and (d)(1)(iv);
0
b. Redesignating paragraph (d)(1)(v) as paragraph (d)(1)(vi);
0
c. Adding a new paragraph (d)(1)(v);
0
d. Revising paragraph (d)(2) introductory text; and
0
e. Adding paragraph (h).
The revisions and additions read as follows:
Sec. 149.140 Methodology for calculating qualifying payment amount.
* * * * *
(d) Information to be shared about the qualifying payment amount.
In cases in which the recognized amount, with respect to an item or
service furnished by a nonparticipating provider or nonparticipating
emergency facility, is the qualifying payment amount or the amount
billed by the provider or facility, or if the amount on which cost
sharing is based with respect to air ambulance services furnished by a
nonparticipating provider of air ambulance services is the qualifying
payment amount or the amount billed by the provider of air ambulance
services, the plan or issuer must provide to the provider, facility, or
provider of air ambulance services, as applicable, in writing, in paper
or electronic form--
(1) * * *
(iv) A statement that--
(A) If the provider, facility, or provider of air ambulance
services, as applicable, wishes to initiate a 30-business-day open
negotiation period for purposes of determining the out-of-network rate,
the provider, facility, or provider of air ambulance services must:
(1) Contact the appropriate person or office to initiate open
negotiation within 30 business days of receiving the initial payment or
notice of denial of payment, and
(2) For disclosures required to be provided on or after [DATE 90
DAYS AFTER PUBLICATION OF FINAL REGULATIONS IN THE FEDERAL REGISTER]
and once the open negotiation notice can be submitted through the
Federal IDR portal, notify the Secretary as described under Sec.
149.510(b)(1)(i); and
(B) If the 30-business-day open negotiation period does not result
in an agreement on the amount of payment the provider, facility, or
provider of air ambulance services may generally initiate the Federal
IDR process within 4 business days after the end of the open
negotiation period;
(v) For disclosures required to be provided on or after [DATE 90
DAYS AFTER PUBLICATION OF FINAL REGULATIONS IN THE FEDERAL REGISTER],
the legal business name of the group health plan (if any) or issuer,
the legal business name of the plan sponsor (if applicable), and the
registration number assigned under Sec. 149.530, if the plan or issuer
is registered under Sec. 149.530.
* * * * *
(2) In a timely manner upon the request of the provider, facility,
or provider of air ambulance services:
* * * * *
(h) Severability. (1) Any provision of this section held to be
invalid or unenforceable by its terms, or as applied to any person or
circumstance, shall be construed so as to continue to give maximum
effect to the provision permitted by law, unless such holding shall be
one of utter invalidity or unenforceability, in which event the
provision shall be severable from this section and shall not affect the
remainder thereof or the application of the provision to persons not
similarly situated or to dissimilar circumstances.
(2) The provisions in Sec. 149.140 are intended to be severable
from the provisions in Sec. Sec. 149.100, 149.510, and 149.530, from
any grant of forbearance from removal resulting from this subpart, and
from any provision referenced in Sec. Sec. 149.100, 149.510, and
149.530.
0
22. Section 149.510 is amended by:
0
a. Revising paragraphs (a)(2)(i), (b), and (c)(1);
[[Page 75878]]
0
b. Redesignating paragraphs (c)(2) through (4) as paragraphs (c)(3)
through (5), respectively;
0
c. Adding a new paragraph (c)(2);
0
d. Revising newly redesignated paragraphs (c)(3), (c)(4)(i)
introductory text, (c)(4)(i)(B) through (D), (c)(4)(ii), (c)(5)(i)
introductory text, (c)(5)(ii) introductory text;
0
e. In newly redesignated paragraphs (c)(5)(ii)(A) and (B), removing the
reference to ``(c)(4)'' and adding in its place ``(c)(5)'';
0
f. Adding paragraphs (c)(5)(ii)(A)(1) and (2);
0
g. Adding paragraphs (c)(5)(vii)(B) and (C);
0
h. Revising paragraphs (d), (e)(2)(vi), (viii), and (ix), (g), and (h);
and
0
i. Adding paragraph (i).
The revisions and additions read as follows:
Sec. 149.510 Independent dispute resolution process.
(a) * * *
(2) * * *
(i) Batched qualified IDR items and services means multiple
qualified IDR items or services that are considered jointly as part of
one payment determination by a certified IDR entity for purposes of the
Federal IDR process in accordance with paragraph (c)(4) of this
section.
* * * * *
(b) Determination of payment amount through open negotiation and
initiation of the Federal IDR process--(1) Determination of payment
amount through open negotiation--(i) In general. With respect to an
item or service that meets the requirements of paragraph (a)(2)(xi)(A)
of this section, the provider, facility, or provider of air ambulance
services, or the group health plan or health insurance issuer offering
group or individual health insurance coverage may, during the 30-
business-day period beginning on the day the provider, facility, or
provider of air ambulance services receives an initial payment or
notice of denial of payment regarding the item or service, initiate an
open negotiation period for purposes of determining the out-of-network
rate for such item or service. To initiate the open negotiation period,
a party must submit a written open negotiation notice with the content
specified in paragraph (b)(1)(ii) of this section to the other party
and to the Secretary in the manner specified in paragraph (b)(3) of
this section. The 30-business-day open negotiation period begins on the
day on which the party first submits the open negotiation notice and
the remittance advice documentation specified in paragraph
(b)(1)(ii)(A)(12) of this section to the other party and the Secretary.
The party in receipt of the open negotiation notice must provide to the
other party and to the Secretary in the manner specified in paragraph
(b)(3) of this section as soon as practicable, but no later than the
15th business day of the 30-business-day open negotiation period, a
written notice and supporting documentation in response to the open
negotiation notice, as specified in paragraph (b)(1)(iii)(A) of this
section.
(ii) Open negotiation notice--(A) Content. The open negotiation
notice must include, with respect to the item or service that is the
subject of the open negotiation notice, information about the item or
service and the parties including:
(1) Information sufficient to identify the provider, facility, or
provider of air ambulance services, including the name and current
contact information (including the legal business name, email address,
phone number, and mailing address) as provided with the claim form
submitted by the provider, facility, or air ambulance provider to the
plan or issuer, and the National Provider Identifier (NPI);
(2) Information sufficient to identify the plan or issuer,
including the plan's or issuer's registration number, as required under
Sec. 149.530, if the plan or issuer is registered under Sec. 149.530,
or an attestation from the party submitting the open negotiation notice
that the plan or issuer was not registered prior to the date it
submitted the notice; the legal business name of the plan or issuer, as
well as the current contact information (name, email address, phone
number, and mailing address) of the plan or issuer as provided with the
initial payment or notice of denial of payment; and if the party
submitting the open negotiation notice is a plan or issuer, the plan
type (for example, self-insured or fully-insured);
(3) The name and contact information (including the legal business
name, email address, phone number, and mailing address) for any third
party representing the party submitting the open negotiation notice,
and an attestation that the third party has the authority to act on
behalf of the party it represents in the open negotiation;
(4) Information sufficient to identify the item or service,
including: the date(s) the item or service was furnished and, if the
party submitting the open negotiation notice is a provider, facility,
or provider of air ambulance services, the date(s) that the provider,
facility, or provider of air ambulance services received the initial
payment or notice of denial of payment for the item or service from the
plan or issuer; the type of item or service (specifically, whether the
item or service is an emergency service as defined in Sec.
149.110(c)(2)(i) or (ii), a non-emergency service as described in Sec.
149.120(b), or an air ambulance service as defined in Sec. 149.30);
whether the service is a professional service or facility-based
service; the State where the item or service was furnished; the claim
number; the service code; and information to identify the location
where the item or service was furnished (such as, place of service code
or bill type code);
(5) The initial payment amount (including $0 if, for example,
payment is denied);
(6) The qualifying payment amount, if provided with the initial
payment or notice of denial of payment or if the party submitting the
open negotiation notice is a plan or issuer;
(7) An offer of an out-of-network rate for each item or service;
(8) If the party submitting the open negotiation notice is a plan
or issuer, the amount of cost sharing imposed for the item or service,
if any;
(9) If the party submitting the open negotiation notice is a
provider or facility, a statement that the items and services do not
qualify for the notice and consent exception described at Sec.
149.410(b) or Sec. 149.420(c) through (i);
(10) A statement that the provider, facility, or provider of air
ambulance services was a nonparticipating provider, nonparticipating
emergency facility, or nonparticipating provider of air ambulance
services on the date the item or service was furnished;
(11) General information listed in the standard open negotiation
notice developed by the Secretary pursuant to paragraph (b)(3) of this
section describing the open negotiation period and the Federal IDR
process (including a description of the purpose of the open negotiation
period and Federal IDR process and key deadlines in the open
negotiation period and Federal IDR process); and
(12) A copy of the initial payment or notice of denial of payment
or other remittance advice that is required to include the disclosures
under Sec. 149.140(d)(1), with respect to the item or service.
(B) [Reserved]
(iii) Open negotiation response notice--(A) Content. The response
to the open negotiation notice must include, with respect to the item
or service that is the subject of the open negotiation response notice,
information about the item or service and the parties including:
(1) Information sufficient to identify the provider, facility, or
provider of air
[[Page 75879]]
ambulance services, including the name and current contact information
(including the legal business name, email address, phone number, and
mailing address) as provided with the claim form submitted by the
provider, facility, or provider of air ambulance services to the plan
or issuer, and the NPI;
(2) Information sufficient to identify the plan or issuer,
including the plan's or issuer's registration number, as required under
Sec. 149.530 if the plan or issuer is registered under Sec. 149.530,
or an attestation from the party submitting the open negotiation
response notice that the plan or issuer was not registered prior to the
date it submitted the notice; the legal business name of the plan or
issuer, as well as the current contact information (name, email
address, phone number, and mailing address) of the plan or issuer as
provided with the initial payment or notice of denial of payment; and
if the party submitting the open negotiation response notice is a plan
or issuer, the plan type (for example, self-insured or fully-insured);
(3) The name and contact information (including the legal business
name, email address, phone number, and mailing address) for any third
party representing the party submitting the open negotiation response
notice, and an attestation that the third party has the authority to
act on behalf of the party it represents in the open negotiation;
(4) Information sufficient to identify the item or service included
in the open negotiation notice, including the date(s) the item or
service was furnished, and if the party submitting the open negotiation
response notice is a provider, facility, or provider of air ambulance
services, the date(s) that the provider, facility, or provider of air
ambulance services received the initial payment or notice of denial of
payment for such item or service from the plan or issuer, and the claim
number;
(5) If the party submitting the open negotiation response notice is
a plan or issuer, a statement as to whether it agrees that the initial
payment amount (including $0 if, for example, payment is denied) and
the qualifying payment amount reflected in the open negotiation notice
accurately reflect the initial payment amount and qualifying payment
amount disclosed with the initial payment for the item or service, and
if not, or if the open negotiation notice indicates that the initial
payment amount or qualifying payment amount was not communicated by the
plan or issuer with the initial payment or notice of denial of payment
or other remittance advice, the initial payment amount (including $0
if, for example, payment is denied) and/or qualifying payment amount it
believes to be correct, and documentation to support the statement (for
example, the remittance advice confirming the qualifying payment
amount);
(6) If the party submitting the open negotiation response notice is
a plan or issuer, the amount of cost sharing imposed for the item or
service, if any;
(7) A counteroffer for an out-of-network rate for each item or
service or an acceptance of the other party's offer;
(8) If the party submitting the open negotiation response notice is
a provider or facility, a statement that the items and services do not
qualify for the notice and consent exception described at Sec.
149.410(b) or Sec. 149.420(c) through (i);
(9) With respect to each item or service, either a statement and
supporting documentation that explains why the item or service is not
subject to the Federal IDR process or a statement agreeing that the
item or service is subject to the Federal IDR process;
(10) A statement as to whether any of the information provided in
the open negotiation notice is inaccurate and the basis for the
statement, as well as supporting documentation; and
(11) A statement confirming that the initial payment or notice of
denial of payment or other remittance advice provided by the party
submitting the open negotiation notice under paragraph
(b)(1)(ii)(A)(12) of this section is accurate, and if inaccurate, a
copy of the accurate initial payment or notice of denial of payment or
other remittance advice required to include the disclosures under Sec.
149.140(d)(1), with respect to the item or service.
(B) [Reserved]
(2) Initiating the Federal IDR process--(i) In general. Either
party may initiate the Federal IDR process with respect to a qualified
IDR item or service for which the parties do not agree upon an out-of-
network rate by the last day of the open negotiation period provided
for under paragraph (b)(1) of this section. To initiate the Federal IDR
process, a party (the initiating party) must submit a written notice of
IDR initiation, consistent with paragraph (b)(2)(ii) of this section,
to the other party to the dispute (the non-initiating party), and to
the Secretary in the manner specified in paragraph (b)(3) of this
section, during the 4-business-day period beginning on the first
business day after the last day of the open negotiation period (unless
it is otherwise required to be submitted in the timeframe specified in
paragraph (c)(5)(vii)(C) of this section). The date of IDR initiation
is the date that the Secretary receives the notice of IDR initiation
described in paragraph (b)(2)(ii) of this section.
(A) Exception for items and services provided by certain
nonparticipating providers and facilities. A party may not initiate the
Federal IDR process with respect to an item or service if, with respect
to that item or service, the party knows (or reasonably should have
known) that the provider or facility provided notice and received
consent under Sec. Sec. 149.410(b) or 149.420(c) through (i).
(B) [Reserved]
(ii) Notice of IDR initiation--(A) Content. The notice of IDR
initiation must include, with respect to the item or service that is
the subject of the notice, information about the item or service and
the parties including:
(1) Information sufficient to identify the provider, facility, or
provider of air ambulance services, including the name and current
contact information (including the legal business name, email address,
phone number, and mailing address), and the NPI; and if the initiating
party is a provider, facility, or provider of air ambulance services,
the Tax Identification Number (TIN);
(2) Information sufficient to identify the plan or issuer,
including the plan's or issuer's registration number, as required under
Sec. 149.530 if the plan or issuer is registered under Sec. 149.530,
or an attestation from the initiating party that the plan or issuer was
not registered prior to the date that it submitted the notice; the
legal business name of the plan or issuer, as well as the current
contact information (name, email address, phone number, and mailing
address) of the plan or issuer as provided with the initial payment or
notice of denial of payment; and if the initiating party is a plan or
issuer, the plan type (for example, self-insured or fully-insured) and
TIN (or, in the case of a plan that does not have a TIN, the TIN of the
plan sponsor);
(3) The name and contact information (including the legal business
name, email address, phone number, and mailing address) for any third
party representing the initiating party, and an attestation that the
third party has the authority to act on behalf of the party it
represents in the Federal IDR process;
(4) Information sufficient to identify whether the dispute being
initiated includes batched or bundled qualified IDR items or services
as described in paragraph (c)(4) of this section;
(5) Information sufficient to identify the qualified IDR item or
service that is the subject of the notice of IDR initiation, including
the date(s) the
[[Page 75880]]
qualified IDR item or service was furnished; if the initiating party is
a provider, facility, or provider of air ambulance services, the
date(s) that the provider, facility, or provider of air ambulance
services received the initial payment or notice of denial of payment
for such item or service from the plan or issuer; the date the open
negotiation period under paragraph (b)(1) of this section began; the
type of item or service (specifically, whether the qualified IDR item
or service is an emergency service as defined in Sec. 149.110(c)(2)(i)
or (ii), a non-emergency service as described in Sec. 149.120(b), or
an air ambulance service as defined in Sec. 149.30); whether the
service is a professional service or facility-based service; the State
where the item or service was furnished; the claim number; the service
code; and information to identify the location the item or service was
furnished (including place of service code or bill type code);
(6) The initial payment amount (including $0 if, for example,
payment is denied);
(7) The qualifying payment amount, if provided with the initial
payment or notice of denial of payment or if the initiating party is a
plan or issuer;
(8) If the initiating party is a provider or facility, a statement
that the items and services do not qualify for the notice and consent
exception described at 45 CFR 149.410(b) or 149.420(c) through (i);
(9) A statement that the provider, facility, or provider of air
ambulance services was a nonparticipating provider, nonparticipating
emergency facility, or nonparticipating provider of air ambulance
services on the date the item or service was furnished;
(10) Attestation that the item or service under dispute is a
qualified IDR item or service, and the basis for the attestation;
(11) General information listed in the standard notice of IDR
initiation developed by the Secretary pursuant to paragraph (b)(3) of
this section describing the Federal IDR process (including a
description of the purpose of the Federal IDR process and key deadlines
in the Federal IDR process);
(12) A copy of the initial payment or notice of denial of payment
or other remittance advice that is required to include the disclosures
under Sec. 149.140(d)(1), with respect to the item or service;
(13) Preferred certified IDR entity; and
(14) A statement describing the key aspects of the claim, such as
patient acuity or level of training of the provider, facility, or
provider of air ambulance services that furnished the qualified IDR
item or service, discussed by the parties during open negotiation that
relate to the payment for the disputed claim, whether the reasons for
initiating the Federal IDR process are different from the aspects of
the claim discussed during the open negotiation period, and an
explanation of why the party is initiating the Federal IDR process,
including any of the permissible considerations described in Sec. Sec.
149.510(c)(5)(iii) and 149.520(b)(2) that serve as the party's basis
for initiating the Federal IDR process.
(B) [Reserved]
(iii) Notice of IDR initiation response. The non-initiating party
must provide to the initiating party and to the Secretary in the manner
specified in paragraph (b)(3) of this section within 3 business days
after the date of IDR initiation, a written notice and supporting
documentation in response to the notice of IDR initiation, as specified
in paragraph (b)(2)(iii)(A) of this section.
(A) Content. The notice of IDR initiation response must include,
with respect to the item or service that is the subject of the notice,
information about the item or service and the parties including:
(1) Information sufficient to identify the provider, facility, or
provider of air ambulance services, including the name and current
contact information (including the legal business name, email address,
phone number, and mailing address), and the NPI; and if the non-
initiating party is a provider, facility, or provider of air ambulance
services, the TIN;
(2) Information sufficient to identify the plan or issuer,
including the plan's or issuer's registration number, as required under
Sec. 149.530 if the plan or issuer is registered under Sec. 149.530
or an attestation from the non-initiating party that the plan or issuer
was not registered prior to the date that it submitted the notice; the
legal business name of the plan or issuer, as well as the current
contact information (name, email address, phone number, and mailing
address) of the plan or issuer as provided with the initial payment or
notice of denial of payment; and if the non-initiating party is a plan
or issuer, the plan type (for example, self-insured or fully-insured)
and TIN (or, in the case of a plan that does not have a TIN, the TIN of
the plan sponsor);
(3) The name and contact information (including the legal business
name, email address, phone number, and mailing address) for any third
party representing the non-initiating party, and an attestation that
the third party has the authority to act on behalf of the party it
represents in the Federal IDR process;
(4) Information sufficient to identify each item or service
included in the notice of IDR initiation, including the date(s) the
item or service was furnished. If the non-initiating party is a
provider, facility, or provider of air ambulance services, the date(s)
that the provider, facility, or provider of air ambulance services
received the initial payment or notice of denial of payment for such
item or service from the plan or issuer, and the claim number;
(5) If the non-initiating party is a plan or issuer, a statement as
to whether the non-initiating party agrees that the initial payment
(including $0 if, for example, payment is denied) and the qualifying
payment amount reflected in the notice of IDR initiation is accurate
for the item or service that is the subject of the dispute, and if not,
the initial payment amount (including $0 if, for example, payment is
denied) and/or qualifying payment amount it believes to be correct, and
documentation to support the statement (for example, the remittance
advice confirming the qualifying payment amount);
(6) If the non-initiating party is a plan or issuer, the amount of
cost sharing imposed for the item or service, if any;
(7) If the non-initiating party is a provider or facility, a
statement that the items and services do not qualify for the notice and
consent exception described at Sec. 149.410(b) or Sec. 149.420(c)
through (i);
(8) With respect to each item or service that is the subject of the
dispute, either an attestation that the item or service is a qualified
IDR item or service, or for each item or service that the non-
initiating party asserts is not a qualified IDR item or service, an
explanation and documentation to support the statement;
(9) A statement confirming that the initial payment or notice of
denial of payment or other remittance advice provided by the initiating
party under paragraph (b)(2)(ii)(A)(12) of this section is accurate,
and if inaccurate, a copy of the accurate initial payment or notice of
denial of payment or other remittance advice required to include the
disclosures under Sec. 149.140(d)(1), with respect to the item or
service;
(10) A statement as to whether any of the information provided in
the notice of IDR initiation is inaccurate and the basis for the
statement as well as any supporting documentation; and
(11) A statement as to whether the non-initiating party agrees or
objects to the initiating party's preferred certified IDR entity. If
the non-initiating party objects to the initiating party's preferred
[[Page 75881]]
certified IDR entity, the notice of IDR initiation response must
include the name of an alternative preferred certified IDR entity and,
if applicable, an explanation of any conflict of interest with the
initiating party's preferred certified IDR entity.
(B) [Reserved].
(3) Manner. A party furnishing notices as required under paragraphs
(b)(1)(ii) and (iii), and (b)(2)(ii) and (iii) of this section must
furnish the notices using the standard forms developed by the Secretary
and must furnish the notices and supporting documentation to the other
party and the Secretary, through the Federal IDR portal.
(c) * * *
(1) Selection of certified IDR entity--(i) Preliminary selection of
the certified IDR entity. Within 3 business days after the date of IDR
initiation, the non-initiating party must agree or object to the
preferred certified IDR entity identified in the notice of IDR
initiation, as described in paragraph (b)(2)(iii)(A)(11) of this
section.
(A) If the non-initiating party agrees, or fails to object, to the
selection of the initiating party's preferred certified IDR entity in
the manner described in paragraph (b)(2)(iii)(A)(11) of this section
and within the timeframe specified in paragraph (c)(1)(i) of this
section, the initiating party's preferred certified IDR entity will be
considered jointly selected on the third business day after the date of
IDR initiation.
(B) If the non-initiating party objects to the selection of the
initiating party's preferred certified IDR entity by designating an
alternative preferred certified IDR entity in the manner described in
paragraph (b)(2)(iii)(A)(11) of this section and within the timeframe
specified in paragraph (c)(1)(i) of this section, the initiating party
may then agree or object to the non-initiating party's alternative
preferred certified IDR entity by submitting the notice of certified
IDR entity selection in the manner specified in paragraph (c)(1)(i)(D)
of this section. If the initiating party agrees to the non-initiating
party's alternative preferred certified IDR entity within 3 business
days after the date of IDR initiation, or if the non-initiating party
submits the notice of IDR initiation response on or before the second
business day after the date of IDR initiation and the initiating party
fails to respond within 3 business days after the date of IDR
initiation, the alternative preferred certified IDR entity will be
considered jointly selected by the parties. If the non-initiating party
submits the notice of IDR initiation response on the third business day
after the date of IDR initiation and the initiating party does not
agree on the same day, selection will proceed under paragraph
(c)(1)(i)(C) of this section.
(C) If a certified IDR entity is not jointly selected under
paragraph (c)(1)(i)(A) or (B) of this section, either party may select
an alternative preferred certified IDR entity by submitting the notice
of certified IDR entity selection in the manner specified in paragraph
(c)(1)(i)(D) of this section, until the earlier of the date that the
parties agree on the alternative preferred certified IDR entity or the
deadline for joint selection, which is 3 business days after the date
of IDR initiation. Once a party submits a notice of certified IDR
entity selection, it may not submit another notice of certified IDR
entity selection until after it receives a responding notice of
certified IDR entity selection from the other party.
(1) If a party submits a notice of certified IDR entity selection
to the other party on the first or second day after the date of IDR
initiation and the party in receipt of the notice agrees or fails to
object to the alternative preferred certified IDR entity by the third
business day after the date of IDR initiation, the alternative
preferred certified IDR entity will be considered jointly selected by
the parties.
(2) If a party submits a notice of certified IDR entity selection
to the other party on the third business day after the date of IDR
initiation and the party last in receipt of the notice agrees to the
alternative preferred certified IDR entity on the same day, the
alternative preferred certified IDR entity will be considered jointly
selected by the parties.
(3) If a party submits a notice of certified IDR entity selection
to the other party on the third business day after the date of IDR
initiation and the party last in receipt of the notice does not agree
to the alternative preferred certified IDR entity on the same day, the
parties will have failed to jointly select a certified IDR entity.
(D) To notify the other party and the Secretary of an agreement or
objection to an alternative preferred certified IDR entity under
paragraph (c)(1)(i)(C) of this section, a party must submit the notice
of certified IDR entity selection. The party must furnish the notice of
certified IDR entity selection using the standard form developed by the
Secretary and must furnish the notice to the other party and the
Secretary through the Federal IDR portal within 3 business days after
the date of IDR initiation. However, in the event the conditions under
paragraph (c)(1)(ii) of this section apply, the party may notify the
Secretary of an agreement or objection to an alternative preferred
certified IDR entity in accordance with paragraph (c)(1)(ii) of this
section. The notice of certified IDR entity selection must include a
statement indicating the party's agreement with or objection to the
other party's alternative preferred certified IDR entity and, if
applicable, an explanation of any conflict of interest with the
alternative preferred certified IDR entity. If the party in receipt of
a notice of certified IDR entity selection objects to the other party's
alternative preferred certified IDR entity and the party submits a
notice of certified IDR entity selection by the end of the third
business day after the date of IDR initiation, that party's notice of
certified IDR entity selection reflecting the objection must include
the name of another alternative preferred certified IDR entity.
(ii) Failure to jointly select a certified IDR entity. If the
parties fail to jointly select a certified IDR entity within 3 business
days after the date of IDR initiation, the Secretary will select a
certified IDR entity. The parties will have failed to jointly select a
certified IDR entity if, by the end of the third business day after the
date of IDR initiation, the party last in receipt of the notice of IDR
initiation response or the notice of certified IDR entity selection has
objected to the other party's alternative preferred certified IDR
entity, or if the notice of IDR initiation response or the notice of
certified IDR entity selection is submitted to the other party on the
third business day after the date of IDR initiation and the party in
receipt of the notice does not agree to the alternative preferred
certified IDR entity within 3 business days after the date of IDR
initiation.
(A) In selecting the certified IDR entity, the Secretary will first
confirm whether a party submitted the notice of IDR initiation response
or the notice of certified IDR entity selection with an alternative
preferred certified IDR entity on the third business day after the date
of IDR initiation without the other party's agreement to the selection.
If either notice was provided on the third business day after the date
of IDR initiation without the other party's agreement to the
alternative preferred certified IDR entity by the end of third business
day after the date of IDR initiation, the Secretary will provide the
party last in receipt of the applicable notice 2 additional business
days to agree or object to the other party's alternative preferred
certified IDR entity selection.
(1) If the party last in receipt of the notice of IDR initiation
response or the notice of certified IDR entity selection
[[Page 75882]]
agrees with the other party's alternative preferred certified IDR
entity and notifies the Secretary of the agreement or fails to notify
the Secretary of its objection in the Federal IDR portal by the fifth
business day after the date of IDR initiation, the Secretary will
select the final alternative preferred certified IDR entity selected in
the applicable notice. In disputes where the applicable notice was
submitted on the third business day after the date of IDR initiation,
the party last in receipt of the notice will not be allowed to select
another alternative preferred certified IDR entity.
(2) If the party notifies the Secretary of its objection to the
alternative preferred certified IDR entity by the fifth business day
after the date of IDR initiation, the Secretary will proceed with the
random selection of the certified IDR entity from among the certified
IDR entities (other than the preferred certified IDR entity and any
alternative preferred certified IDR entity previously selected in such
dispute by a party, unless there is no other certified IDR entity
available to select) that charge a fee within the allowed range of
certified IDR entity fees on the sixth business day after the date of
IDR initiation. If there are insufficient certified IDR entities that
charge a fee within the allowed range of certified IDR entity fees
available to arbitrate the dispute, the Secretary will select a
certified IDR entity that has received approval, as described in
paragraph (e)(2)(vii)(B) of this section, to charge a fee outside of
the allowed range of certified IDR entity fees. In either case, the
Secretary will notify the parties of the preliminary selection of the
certified IDR entity not later than 6 business days after the date of
IDR initiation.
(B) [Reserved].
(iii) Date of preliminary selection of the certified IDR entity.
The date of preliminary selection of the certified IDR entity will be:
(A) Three business days after the date of IDR initiation if the
parties jointly selected a certified IDR entity, as specified in
paragraph (c)(1)(i) of this section; or
(B) Six business days after the date of IDR initiation, if the
parties fail to jointly select a certified IDR entity as specified in
paragraph (c)(1)(ii) of this section.
(iv) Final selection of the certified IDR entity--(A) Conflict-of-
interest review. The certified IDR entity preliminarily selected for a
dispute must review the selection. The selection of the certified IDR
entity will be finalized only if the certified IDR entity attests to
the Secretary that it meets the following requirements:
(1) The certified IDR entity does not have a conflict of interest
as defined in paragraph (a)(2)(iv) of this section;
(2) The certified IDR entity will only assign personnel to a
dispute and make decisions regarding hiring, compensation, termination,
promotion, or other similar matters related to personnel assigned to
the dispute in a manner that is not based upon the likelihood that the
assigned personnel will support a particular party to the dispute; and
(3) The certified IDR entity will not assign any personnel to a
dispute who would have any conflicts of interest, as defined in
paragraph (a)(2)(iv) of this section, regarding any party to the
dispute or whose relationship with a party within the 1 year
immediately preceding the assignment to the dispute would violate the
restrictions on aiding or advising a former employer or principal in a
manner similar to the restrictions set forth in 18 U.S.C. 207(b).
(B) Failure to meet conflict-of-interest requirements. If the
certified IDR entity notifies the Secretary within 3 business days of
the date of preliminary selection of the certified IDR entity that it
does not meet the requirements of paragraphs (c)(1)(iv)(A)(1) through
(3) of this section or if the certified IDR entity does not respond
within 3 business days after the date of preliminary selection of the
certified IDR entity, the Secretary will randomly select another
certified IDR entity consistent with paragraph (c)(1)(ii) of this
section. The Secretary will notify the parties of the new randomly
preliminarily selected certified IDR entity no later than 1 business
day after the previously selected certified IDR entity notifies the
Secretary that it has a conflict of interest or, if the previously
selected certified IDR entity fails to respond within 3 business days
after the date of preliminary selection of the certified IDR entity, no
later than 1 business day after the end of the 3-business-day period.
(C) Date of final selection of the certified IDR entity. If the
certified IDR entity that has been preliminarily selected attests
within 3 business days that it meets the requirements of paragraphs
(c)(1)(iv)(A)(1) through (3) of this section, the Secretary will notify
the parties of final selection of the certified IDR entity no later
than 1 business day after the certified IDR entity attests that it
meets the conflict-of-interest requirements. The date of final
selection of the certified IDR entity is the date that the Secretary
provides this notice to the parties.
(2) Federal IDR process eligibility review--(i) Federal IDR process
eligibility determination by certified IDR entity. Unless the
departmental eligibility review described in paragraph (c)(2)(ii) of
this section applies, the selected certified IDR entity must review the
information in the notice of IDR initiation, notice of IDR initiation
response, and any additional information described in paragraph
(c)(2)(iii) of this section, and make a final determination as to
whether the item or service is a qualified IDR item or service, as
defined in paragraph (a)(2)(xi) of this section, that is eligible for
the Federal IDR process. The certified IDR entity must make such a
determination and notify the Secretary and both parties no later than 5
business days after the date of final selection of the certified IDR
entity. If the certified IDR entity determines that the item or service
is not a qualified IDR item or service, the dispute will be closed, and
the selected certified IDR entity will not take any action with regard
to the dispute.
(ii) Departmental eligibility review for Federal IDR process
eligibility determinations. When the conditions for the departmental
eligibility review set forth in paragraph (c)(2)(ii)(A) of this section
are met, the Secretary will conduct the eligibility review and make the
eligibility determination instead of the certified IDR entity. If the
Secretary determines that the item or service is not a qualified IDR
item or service, the dispute will be closed, and the selected certified
IDR entity will not take any action with regard to the dispute. If the
dispute is found to be eligible, the Secretary will inform the
preliminarily selected certified IDR entity of the dispute's
eligibility so that it may conduct its conflict-of-interest assessment,
and the dispute will otherwise continue through the Federal IDR
process, including notification of the eligibility determination to the
disputing parties by the preliminarily selected certified IDR entity.
(A) Application of the departmental eligibility review. The
departmental eligibility review will apply when the Secretary
determines that any of the extenuating circumstances described in
paragraph (g)(1) of this section require application of the
departmental eligibility review to facilitate timely payment
determinations or the effective processing of disputes under the
Federal IDR process.
(B) Notification regarding applicability of the departmental
eligibility review. Before invoking the application of the departmental
eligibility review, the Secretary will
[[Page 75883]]
post advance public notification of the date on which the departmental
eligibility review will take effect and the reasons for invoking the
application of the departmental eligibility review. Before ending the
application of the departmental eligibility review, the Secretary will
post advance public notification of the date on which the departmental
eligibility review will no longer be in effect and the reasons for
ending the application of the departmental eligibility review.
(iii) Request for additional information. The Secretary or the
selected certified IDR entity may request additional information from
either party to a dispute at any time, including for the purpose of
assessing whether a conflict of interest exists, conducting an
eligibility determination, or making a payment determination.
(A) Upon request, a party must submit the additional information
within 5 business days to the Secretary or the selected certified IDR
entity, as applicable, through the Federal IDR portal. Following a
request for additional information, the time period for the applicable
stage of the Federal IDR process will be tolled until the earlier of
the date either all of the requested information is provided or the 5-
business-day period expires, and each subsequent timeframe in the
Federal IDR process will be determined based on the date of completion
of the stage of the Federal IDR process that was tolled for provision
of the requested information.
(B) If a party fails to submit the additional information as
required, the related determination, including the eligibility
determination, conflict-of-interest review, or payment determination
will be made without the requested information unless a good-cause
extension of the 5-business-day period, as specified in paragraph
(g)(1)(i) of this section, has been provided, and the party
subsequently submits the additional information requested within the
extended period.
(3) Authority to continue negotiations or withdraw--(i) Authority
to continue to negotiate. If the parties to the Federal IDR process
agree on an out-of-network rate for a qualified IDR item or service
after providing the notice of IDR initiation to the Secretary required
under paragraph (b)(2)(ii) of this section, but before the certified
IDR entity has made its payment determination, the amount agreed to by
the parties for the qualified IDR item or service will be treated as
the out-of-network rate for the qualified IDR item or service. To the
extent the amount exceeds the initial payment amount and any cost
sharing paid or required to be paid by the participant, beneficiary, or
enrollee, or there was an initial denial of payment, payment must be
made directly by the plan or issuer to the nonparticipating provider,
nonparticipating facility, or nonparticipating provider of air
ambulance services not later than 30 business days after the agreement
is reached. In no instance may either party seek additional payment
from the participant, beneficiary, or enrollee, including in instances
in which the out-of-network rate exceeds the qualifying payment amount.
The initiating party must send a notification to the Secretary and to
the certified IDR entity (if selected) electronically, through the
Federal IDR portal, as soon as possible, but no later than 3 business
days after the date of the agreement. The notification must include the
dispute number, a statement of the out-of-network rate for the
qualified IDR item or service, and signatures from authorized
signatories for both parties.
(ii) Withdrawals. A dispute may be withdrawn from the Federal IDR
process by the initiating party, the Secretary, or a certified IDR
entity before a payment determination is made if one of the following
conditions is met:
(A) The initiating party provides notification through the Federal
IDR portal to the Secretary and the certified IDR entity (if selected)
that both parties to the dispute agree to withdraw the dispute from the
Federal IDR process without agreement on an out-of-network rate. The
notification must include the dispute number, a statement about both
parties' agreement to withdraw and signatures from authorized
signatories for both parties.
(B) The initiating party provides a standard withdrawal request
notice through the Federal IDR portal to the Secretary, the certified
IDR entity (if selected), and the non-initiating party of its request
to withdraw the dispute from the Federal IDR process and the non-
initiating party notifies the Secretary, certified IDR entity (if
selected), and the initiating party through the Federal IDR portal of
its agreement to withdraw from the Federal IDR process within 5
business days of the initiating party's request. If the non-initiating
party fails to respond within 5 business days of the initiating party's
request, the non-initiating party will be considered to have agreed to
the withdrawal, and the dispute will be withdrawn.
(C) The certified IDR entity or Secretary cannot determine
eligibility because both parties to the dispute are unresponsive to any
requests for additional information to determine eligibility as
described in paragraph (c)(2)(iii) of this section, or
(D) The certified IDR entity cannot make a payment determination
because both parties to the dispute have failed to submit an offer as
described in paragraph (c)(5)(i) of this section.
(4) * * *
(i) In general. A certified IDR entity may consider up to 25
qualified IDR items and services jointly as part of one payment
determination that is subject to the certified IDR entity fee for
batched determinations only if the qualified IDR items and services
meet the requirements of this paragraph (c)(4)(i):
* * * * *
(B) Payment for the qualified IDR items and services is required to
be made by the same group health plan or health insurance issuer. For
group or individual health insurance coverage, this requirement is
satisfied if the same issuer is required to make payment for the
qualified IDR items and services, even if the qualified IDR items and
services relate to claims from different group health plans or
individual market policies. For self-insured group health plans, this
requirement is satisfied if the same self-insured group health plan is
required to make payment for the qualified IDR items and services,
including when the plan makes payments through a third party
administrator; the requirement is not satisfied if multiple self-
insured group health plans are required to make payments for the
qualified IDR items and services, even if those group health plans make
payments through the same third party administrator;
(C) The qualified IDR items and services meet any of the following
criteria under which multiple qualified IDR items and services relate
to the treatment of a similar condition and therefore are permitted to
be considered jointly as a single payment determination for purposes of
encouraging efficiencies (including minimizing costs) in the Federal
IDR process:
(1) The qualified IDR items or services were furnished to a single
patient during the same patient encounter. For purposes of this
section, a single patient encounter is defined as a patient encounter
on one or more consecutive days during which the qualified IDR items or
services were furnished to the same patient and billed on the same
claim form; or
(2) The qualified IDR items and services were furnished to one or
more patients and were billed under the same service code or a
comparable code under a different procedural coding
[[Page 75884]]
system, such as Current Procedural Terminology (CPT) codes with
modifiers, if applicable, Healthcare Common Procedure Coding System
(HCPCS) codes with modifiers, if applicable, or Diagnosis-Related Group
(DRG) codes with modifiers, if applicable; or
(3) For anesthesiology, radiology, pathology, and laboratory
qualified IDR items and services, the qualified IDR items and services
were furnished to one or more patients and were billed under service
codes belonging to the same Category I CPT code range, as specified in
guidance published by the Secretary; and
(D) All the qualified IDR items and services were furnished within
the same 30-business-day period following the date on which the first
item or service included in the batched determination was furnished and
were the subjects of a 30-business-day open negotiation period that
ended within 4 business days of IDR initiation, except as provided in
paragraph (c)(5)(vii) of this section.
(ii) Treatment of bundled payment arrangements. Qualified IDR items
and services that meet the definition of a bundled payment arrangement
under Sec. 149.30 may be submitted and considered as a single payment
determination, and the certified IDR entity must make a single payment
determination for the multiple qualified IDR items and services
included in the bundled payment arrangement. Bundled payment
arrangements as defined in Sec. 149.30 and submitted under this
paragraph (c)(4)(ii) are subject to the certified IDR entity fee for
single determinations.
(5) * * *
(i) Submission of offers. Not later than 10 business days after the
date of the final selection of the certified IDR entity as described in
paragraph (c)(1)(iv)(C) of this section (or not later than 10 business
days after the qualified IDR items and services are determined eligible
as described in paragraph (c)(2) of this section, when the Secretary
determines that any of the extenuating circumstances described in
paragraph (g)(1)(ii) of this section apply), the plan or issuer and the
provider, facility, or provider of air ambulance services:
* * * * *
(ii) Payment determination and notification. Not later than 30
business days after the date of the final selection of the certified
IDR entity as described in paragraph (c)(1)(iv)(C) of this section (or
not later than 30 business days after the qualified IDR items and
services are determined eligible as described in paragraph (c)(2) of
this section, when the Secretary determines that any of the extenuating
circumstances described in paragraph (g) of this section apply), the
certified IDR entity must:
(A) * * *
(1) Prevailing party. In the case of single determinations, the
party whose offer is selected by the certified IDR entity is considered
the prevailing party. In the case of batched determinations, the party
with the most determinations in its favor is considered the prevailing
party; if each party prevails in an equal number of determinations,
neither party will be considered the prevailing party, and the
certified IDR entity fee will be split evenly between the parties.
(2) Non-prevailing party. In the case of single determinations, the
party whose offer is not selected by the certified IDR entity is
considered the non-prevailing party. In the case of batched
determinations, the party with the fewest determinations in its favor
is considered the non-prevailing party.
* * * * *
(vii) Effects of determination.
(A) * * *
(B) Suspension of certain subsequent IDR requests. In the case of a
determination made by a certified IDR entity under paragraph (c)(5)(ii)
of this section, the party that submitted the initial notification
under paragraph (b)(2) of this section may not submit a subsequent
notification involving the same other party with respect to a claim for
the same item or service that was the subject of the initial
notification during the 90-calendar-day period following the
determination.
(C) Subsequent submission of requests permitted. If the end of the
open negotiation period specified in paragraph (b)(1) of this section
occurs during the 90-calendar-day suspension period regarding claims
for the same item or service that were the subject of the initial
notice of IDR determination as described in paragraph (c)(5)(vi) of
this section, either party may initiate the Federal IDR process for
those claims by submitting a notification as specified in paragraph
(b)(2) of this section during the 30-business-day period beginning on
the day after the last day of the 90-calendar-day suspension period.
* * * * *
(d) Costs of IDR process--(1) Certified IDR entity fee--(i) Timing
of payment of certified IDR entity fee. Each party to a dispute for
which there is a final selection of the certified IDR entity and a
determination that the dispute is eligible for the Federal IDR process
in accordance with paragraph (c)(2) of this section must pay to the
certified IDR entity the predetermined certified IDR entity fee charged
by the certified IDR entity. The certified IDR entity fee must be paid
no later than the date a party submits its offer to the certified IDR
entity, in accordance with paragraph (c)(5)(i) of this section.
(ii) Failure to timely pay certified IDR entity fee. If a party
fails to pay the certified IDR entity fee as specified in paragraph
(d)(1)(i) of this section, that party's offer will not be considered
received. Such party will continue to be responsible for payment of the
certified IDR entity fee.
(iii) Method of allocation of the certified IDR entity fee after a
payment determination. After making a payment determination, the
certified IDR entity shall retain the certified IDR entity fee
described under paragraph (d)(1)(i) of this section paid by the non-
prevailing party as defined in paragraph (c)(5)(ii)(A)(2) of this
section. The certified IDR entity must return the fee paid by the
prevailing party, as defined in paragraph (c)(5)(ii)(A)(1) of this
section, within 30 business days following the date of the certified
IDR entity's payment determination. In the event of a batched dispute
in which each party prevails in an equal number of determinations, the
certified IDR entity fee will be split evenly between the parties. In
that case, the certified IDR entity must return half the fee paid by
each party within 30 business days following the date of the certified
IDR entity's payment determination.
(iv) Method of allocation of the certified IDR entity fee upon
agreement or withdrawal after an eligibility determination. For a
dispute for which there is a final selection of the certified IDR
entity and a determination that the dispute is eligible for the Federal
IDR process in accordance with paragraph (c)(2) of this section, unless
directed otherwise by both parties, the certified IDR entity is
required to return half of each party's certified IDR entity fee within
30 business days of the date both parties notify the certified IDR
entity that they have:
(A) Reached an agreement on an out-of-network rate for qualified
IDR items or services before the certified IDR entity has made its
payment determination, as described in paragraph (c)(3)(i) of this
section; or
(B) Withdrawn the dispute before the certified IDR entity has made
its payment determination, as described in paragraph (c)(3)(ii) of this
section.
(v) Method of allocation of the certified IDR entity fee upon
agreement or withdrawal before an eligibility determination. When the
parties reach an agreement on an out-of-network rate
[[Page 75885]]
or withdraw a dispute for which there is a final selection of the
certified IDR entity, but for which no eligibility determination has
yet been made, unless directed otherwise by both parties, the certified
IDR entity is required to return each party's full certified IDR entity
fee within 30 business days of the date both parties notify the
certified IDR entity that they have agreed on an out-of-network rate or
agreed to withdraw the dispute.
(2) Administrative fee. (i) In general. Each party to a dispute for
which a certified IDR entity is selected under paragraph (c)(1) of this
section must pay a non-refundable administrative fee to the Secretary
for participating in the Federal IDR process.
(A) Timing of payment of administrative fee. The initiating party
must pay the administrative fee within 2 business days of the date of
preliminary selection of the certified IDR entity as described in
paragraph (c)(1)(iii) of this section. The non-initiating party must
pay the administrative fee within 2 business days of the date the non-
initiating party receives notice that an eligibility determination for
the Federal IDR process has been reached by either the certified IDR
entity or the Departments in accordance with paragraph (c)(2) of this
section.
(B) Agreements and withdrawals. In the case of an agreement, as
described in paragraph (c)(3)(i) of this section, or a withdrawal, as
described in paragraph (c)(3)(ii) of this section, the administrative
fee will not be returned to the parties if preliminary selection of the
certified IDR entity has occurred, as described in paragraph (c)(1)(i)
of this section; if not yet collected, the administrative fee must
still be paid, except as provided in paragraph (d)(2)(i)(C) of this
section for a dispute closed for nonpayment by an initiating party.
(C) Failure to pay administrative fee. If the initiating party
fails to pay the administrative fee in accordance with paragraph
(d)(2)(i)(A) of this section, the dispute will be closed due to
nonpayment and neither party will be responsible for the administrative
fee. If the non-initiating party fails to pay the administrative fee in
accordance with paragraph (d)(2)(i)(A) of this section, that party's
offer will not be considered received and the non-initiating party will
continue to be responsible for payment of the administrative fee.
(D) Collection of unpaid fees. Any party that fails to pay the
administrative fee owed in accordance with paragraph (d)(2)(i)(A) of
this section is obligated to pay the administrative fee otherwise due
and owing, except as provided in paragraph (d)(2)(i)(C) of this section
for a dispute closed for nonpayment by an initiating party. The
Secretary will pursue collection from a party to a dispute of any
administrative fee that is not timely paid pursuant to applicable debt
collection authorities, after netting any amounts owed by the Federal
Government in accordance with Sec. 156.1215 of this Title, as
applicable.
(ii) Administrative fee amount. The administrative fee amount and
method of payment will be established through notice and comment
rulemaking in a manner such that the total administrative fees paid for
a year, including administrative fees reduced under paragraph
(d)(2)(iii) of this section, are estimated to be equal to the projected
amount of expenditures made by the Secretaries of the Treasury, Labor,
and Health and Human Services for the year in carrying out the Federal
IDR process.
(A) For disputes initiated on or after the later of the effective
date of Federal Independent Dispute Resolution (IDR) Process
Administrative Fee and Certified IDR Entity Fee Ranges final rules or
January 1, 2024, the administrative fee amount is $150 per party per
dispute, which will remain in effect until changed by subsequent
rulemaking.
(B) [Reserved]
(iii) Reducing the administrative fee amount. For disputes
initiated on or after January 1, 2025--
(A) The Secretary may reduce the administrative fee for both
parties in accordance with paragraph (d)(2)(iii)(C) of this section
when the highest offer made by either party during open negotiation for
the dispute is less than the threshold established in notice and
comment rulemaking pursuant to paragraph (d)(2)(ii) of this section.
For a dispute that satisfies the requirements for a reduced
administrative fee in accordance with this paragraph and for which a
determination has been made that the dispute is eligible for the
Federal IDR process in accordance with paragraph (c)(2) of this
section, the administrative fee amount may be reduced to 50 percent of
the administrative fee amount as described in paragraph (d)(2)(ii) of
this section for each party to the dispute. For a dispute that
satisfies the requirements for a reduced administrative fee in
accordance with this paragraph and for which a determination has been
made that the dispute is ineligible for the Federal IDR process in
accordance with paragraph (c)(2) of this section, the administrative
fee amount may be reduced to 50 percent of the administrative fee
amount as described in paragraph (d)(2)(ii) of this section for the
initiating party and to 20 percent of the administrative fee amount for
the non-initiating party.
(B) The Secretary may reduce the administrative fee for a non-
initiating party in accordance with paragraph (d)(2)(iii)(C) of this
section when the dispute is determined to be ineligible for the Federal
IDR process in accordance with paragraph (c)(2) of this section. For a
dispute that satisfies the requirements for a reduced administrative
fee in accordance with this paragraph, the administrative fee amount
for the non-initiating party may be reduced to 20 percent of the
administrative fee amount as described in paragraph (d)(2)(ii) of this
section.
(C) The reduced administrative fee amounts provided for in
paragraphs (d)(2)(iii)(A) and (d)(2)(iii)(B) of this section shall be
established in notice and comment rulemaking and will remain in effect
until changed by subsequent rulemaking, pursuant to paragraph
(d)(2)(ii) of this section.
(e) * * *
(2) * * *
(vi) Meet appropriate indicators of fiscal integrity and stability
by demonstrating that the certified IDR entity has a system of
safeguards and controls in place to prevent and detect improper
financial activities by its employees and agents to assure fiscal
integrity and accountability for all certified IDR entity fees and
administrative fees (if applicable) received, held, and disbursed and
by submitting 3 years of financial statements or, if not available,
other information to demonstrate fiscal stability of the certified IDR
entity;
* * * * *
(viii) Have a procedure in place to retain the certified IDR entity
fees described in paragraph (d)(1) of this section paid by both parties
in a trust or escrow account and to return the certified IDR entity fee
paid by the prevailing party or a portion of each party's certified IDR
entity fee in the case of an agreement described in paragraph (c)(3)(i)
of this section, a withdrawal described in paragraph (c)(3)(ii) of this
section, or a circumstance described under paragraph (d)(1)(iii) of
this section, within 30 business days following the date of the
determination;
(ix) Have a procedure in place to retain the administrative fees
(if applicable) described in paragraph (d)(2) of this section and to
remit the administrative fees to the Secretary in accordance with the
timeframe and
[[Page 75886]]
procedures set forth in guidance published by the Secretary;
* * * * *
(g) * * *
(1) In general. The time periods specified in this section (other
than the time for payment, if applicable, under paragraph (c)(5)(ix) of
this section) may be extended in extenuating circumstances at the
Secretary's discretion. Extenuating circumstances include, but are not
limited to when:
(i) With respect to a specific dispute, the Secretary determines
that the parties or certified IDR entity cannot meet applicable
timeframes due to matters beyond the control of one or both parties or
the certified IDR entity, or for other good cause. The certified IDR
entity or either party may also submit a request for an extension due
to extenuating circumstances to the Secretary through the Federal IDR
portal. The requesting certified IDR entity or party must attest that
it will take prompt action to ensure that the certified IDR entity's
payment determination under this section may be made as soon as
administratively practicable under the circumstances; or
(ii) The Secretary determines that the parties or certified IDR
entity cannot meet applicable timeframes due to systematic delays in
processing disputes under the Federal IDR process, such as an
unforeseen volume of disputes or Federal IDR portal system failures.
Extensions provided due to extenuating circumstances caused by an
unforeseen volume of disputes will be applied to the timeframe for
eligibility determinations under paragraph (c)(2) of this section.
Extensions provided due to extenuating circumstances caused by systems
failures within the Federal IDR portal will be applied to the Federal
IDR process timeframe(s) determined relevant by the Secretary. The
Secretary will post a public notice regarding any extensions of time
periods pursuant to this paragraph (g)(1)(ii).
(A) Timeframe following an extension to eligibility determination.
When an extension to the eligibility determination timeframe pursuant
to paragraph (g)(1)(ii) of this section is in effect, the start date of
the subsequent timeframes in the Federal IDR process will be determined
based on the date of completion of the eligibility determination by the
certified IDR entity or the Secretary.
(1) Submission of offers. The parties must submit their offers and
certified IDR entity fees to the certified IDR entity not later than 10
business days after the qualified IDR items and services are determined
eligible as described in paragraph (c)(2) of this section.
(2) Payment Determination. The certified IDR entity must make the
payment determination and notification of the payment determination to
the parties not later than 30 business days after the qualified IDR
items and services are determined eligible as described in paragraph
(c)(2) of this section.
(B) Timeframe following an extension to other timeframes in the
Federal IDR process. When an extension to any timeframe within the
Federal IDR process, other than the eligibility timeframe, is in effect
pursuant to paragraph (g)(1)(ii) of this section, the start date of
each subsequent timeframe in the Federal IDR process will be determined
based on the date of completion of the process for which the extension
was granted.
(2) [Reserved]
(h) Applicability date. (1) Paragraph (a) of this section is
applicable with respect to plan years (or in the individual market,
policy years) beginning on or after January 1, 2022, except that the
provisions regarding IDR entity certification at paragraphs (a) and (e)
of this section are applicable beginning on October 7, 2021, and the
revised definition for batched qualified IDR items and services at
paragraph (a)(2)(i) of this section is applicable to disputes with open
negotiation periods beginning on or after the later of August 15, 2024,
or 90 days after the effective date of the rule.
(2) Paragraph (b) of this section is applicable to disputes with
open negotiation periods beginning on or after the later of August 15,
2024, or 90 days after the effective date of the rule.
(3) Paragraph (c)(1) of this section, regarding the selection of a
certified IDR entity, is applicable to disputes with open negotiation
periods beginning on or after the later of August 15, 2024, or 90 days
after the effective date of the rule, except that paragraphs
(c)(1)(iv)(A)(1) through (3) of this section, regarding the conflict-
of-interest standards, are applicable with respect to plan years (or in
the individual market, policy years) beginning on or after January 1,
2022.
(4) Paragraph (c)(2) of this section, regarding the Federal IDR
process eligibility review and paragraph (c)(3) of this section
regarding the authority to continue negotiations or withdraw are
applicable to disputes with open negotiation periods beginning on or
after the later of August 15, 2024, or 90 days after the effective date
of the rule and paragraph (c)(4) of this section regarding the
treatment of batched and bundled qualified IDR items and services is
applicable 90 days after the effective date of the rule.
(5) Paragraphs (c)(5)(i) and (ii), and (c)(5)(vii)(B) and (C) of
this section regarding the deadlines for the submission of offers,
payment determination and notification, suspension of certain
subsequent IDR requests, and subsequent submission of requests
submitted are applicable to disputes with open negotiation periods
beginning on or after the later of August 15, 2024, or 90 days after
the effective date of the rule. Paragraphs (c)(5)(iii) and (iv) of this
section regarding considerations in payment determinations and the
related examples and paragraph (c)(5)(vi)(B) of this section regarding
written decisions are applicable with respect to items or services
furnished on or after October 25, 2022, for plan years (or in the
individual market policy years) beginning on or after January 1, 2022.
Paragraphs (c)(5)(v) through (c)(5)(vi)(A), (c)(5)(vii)(A), and
(c)(5)(viii) and (ix) are applicable with respect to plan years (or in
the individual market, policy years) beginning on or after January 1,
2022.
(6) Paragraph (d) of this section regarding the costs of the IDR
process is applicable to disputes initiated on or after January 1,
2025.
(7) Paragraph (e) of this section is applicable with respect to
plan years (or in the individual market, policy years) beginning on or
after January 1, 2022, except that the provisions regarding IDR entity
certification at paragraphs (e)(1), (e)(2)(i) through (vi), (e)(2)(x)
and (xi), and (e)(3) through (6) of this section are applicable
beginning on October 7, 2021. Paragraphs (e)(2)(vi), (viii), and (ix)
of this section regarding the certified IDR entity's controls to
prevent and detect improper financial activities, and procedures to
retain the certified IDR entity fee and administrative fee are
applicable upon the effective date of the rule.
(8) Paragraph (f) of this section is applicable with respect to
plan years (or in the individual market, policy years) beginning on or
after January 1, 2022, except that paragraph (f)(1)(v)(F) of this
section regarding reporting of information relating to the Federal IDR
process is applicable with respect to items or services furnished on or
after October 25, 2022, for plan years (or in the individual market
policy years) beginning on or after January 1, 2022.
(9) Paragraph (g) of this section regarding the extension of time
periods for extenuating circumstances is applicable to disputes with
open negotiation periods beginning on or
[[Page 75887]]
after the later of August 15, 2024, or 90 days after the effective date
of the rule.
(10) Until the relevant applicability date for the requirements of
this section, plans, issuers, providers, facilities, providers of air
ambulance services and certified IDR entities are required to continue
to comply with the corresponding section of Sec. 149.510 in effect on
October 25, 2022.
(i) Severability. (1) Any provision of this section held to be
invalid or unenforceable by its terms, or as applied to any person or
circumstance, shall be construed so as to continue to give maximum
effect to the provision permitted by law, unless such holding shall be
one of utter invalidity or unenforceability, in which event the
provision shall be severable from this section and shall not affect the
remainder thereof or the application of the provision to persons not
similarly situated or to dissimilar circumstances.
(2) The provisions of paragraphs (b)(1), (c)(2)(ii), (c)(4),
(d)(2), and (g)(1) of this section are intended to be severable from
one another, from any grant of forbearance from removal resulting from
this subpart, and from any provision referenced in those paragraphs.
The provisions in Sec. 149.510 are intended to be severable from the
provisions in Sec. Sec. 149.100, 149.140, and 149.530, from any grant
of forbearance from removal resulting from this subpart, and from any
provision referenced in Sec. Sec. 149.100, 149.140, and 149.530.
0
23. Section 149.530 is added to subpart F to read as follows:
Sec. 149.530 Federal independent dispute resolution registry of group
health plans, health insurance issuers, and Federal Employees Health
Benefits Carriers.
(a) Establishment of Federal independent dispute resolution
registry. The Secretary, jointly with the Secretary of the Treasury and
the Secretary of Labor, will establish a Federal IDR registry
consisting of the information described in paragraph (b)(2) of this
section and will assign a registration number for each group health
plan, health insurance issuer offering group or individual health
insurance coverage, and Federal Employees Health Benefits (FEHB)
Program carrier. The information contained in the registry will be made
available to parties seeking to initiate an open negotiation or a
dispute through the Federal IDR portal, and will be searchable,
including by registration number.
(b) Federal IDR registration--(1) Registration requirement. Each
group health plan and health insurance issuer offering group or
individual health insurance coverage subject to the Federal IDR process
must register with the Federal IDR registry as specified by the
Secretary in guidance. Initial registration must be completed by the
later of the date that is 30 business days after the effective date of
the final rule, the date that is 30 business days after the registry
becomes available, or the date the group health plan or health
insurance issuer begins offering a group health plan or individual
health insurance coverage subject to the Federal IDR process.
(2) Required data elements. Group health plans and health insurance
issuers offering group or individual health insurance coverage subject
to the registration requirement must include the following information
with their registration:
(i) The legal business name (if any) of the group health plan,
issuer, or FEHB carrier and, if applicable, the legal business name of
the group health plan sponsor;
(ii) Whether the plan or coverage is a self- or fully-insured group
health plan subject to ERISA, individual health insurance coverage, a
plan offered by a FEHB carrier, a self- or fully-insured non-Federal
governmental plan, or a self- or fully-insured church plan;
(iii) The State(s) in which the plan or coverage is subject to a
specified State law, as defined in Sec. 149.30 for any items or
services for which the protections of Sec. Sec. 149.110, 149.120, and
149.130 apply;
(iv) The State(s) in which the plan or coverage is subject to an
All-Payer Model Agreement under section 1115A of the Social Security
Act for any items or services to which the protections in Sec. Sec.
149.110, 149.120, and 149.130, apply;
(v) For self-insured group health plans not otherwise subject to
State law, any State(s) in which the group health plan has properly
effectuated an election to opt in to a specified State law as defined
in Sec. 149.30, if that State allows a plan not otherwise subject to
the State law to opt-in; and for FEHB plans that adopt a specified
State law pursuant to their FEHB carrier's contract terms, any State(s)
in which they have made such an adoption;
(vi) Contact information, including a telephone number and email
address, for the appropriate person or office to initiate open
negotiations for purposes of determining an amount of payment
(including cost sharing) for such item or service;
(vii) The 14-digit Health Insurance Oversight System (HIOS)
identifier; or if the 14-digit HIOS identifier has not been assigned,
the 5-digit HIOS identifier; or if no HIOS identifier is available, the
plan's or the plan sponsor's Employer Identification Number (EIN) and
the plan's plan number (PN), if a PN is available, or for FEHB
carriers, the applicable contract number(s) and plan code(s);
(viii) Additional information needed to identify the plan or issuer
and the applicable Federal and State requirements for determining
appropriate out-of-network payment rates for items or services to which
the protections against balance billing in this part apply, as
specified by the Secretary in guidance, or such additional information
needed with respect to FEHB carriers as specified by OPM in guidance;
and
(ix) Additional information needed for purposes of administrative
fee collection, as specified by the Secretary in guidance, or such
additional information needed with respect to FEHB carriers as
specified by OPM in guidance.
(3) Updating disclosures. A plan or issuer must timely report to
the Secretary changes to the information required under this section
within 30 calendar days after the information changes. A plan or issuer
must confirm the accuracy of its registration annually in the fourth
quarter of each calendar year.
(4) Third party authority. The requirements of paragraphs (b)(1)
through (3) of this section may be performed by a third party
administrator or service provider with authority to act on behalf of
the group health plan or health insurance issuer offering group or
individual health insurance coverage subject to the Federal IDR
process. If the registration requirements are performed by such third
party administrator or service provider the group health plan or health
insurance issuer offering group or individual health insurance coverage
must require that such third party administrator or service provider
clearly delineate each group health plan or health insurance issuer
offering group health insurance coverage for which it has authority to
act. If such third party administrator or service provider fails to
provide the information in compliance with the requirements of
paragraphs (b)(1) through (3) of this section the plan or issuer will
be in violation of the requirements of this section.
(c) Severability. (1) Any provision of this section held to be
invalid or unenforceable by its terms, or as applied to any person or
circumstance, shall be construed so as to continue to give maximum
effect to the provision permitted by law, unless such holding shall be
one of utter invalidity or unenforceability, in which event the
provision shall be severable from this
[[Page 75888]]
section and shall not affect the remainder thereof or the application
of the provision to persons not similarly situated or to dissimilar
circumstances.
(2) The provisions in Sec. 149.530 are intended to be severable
from the provisions in Sec. Sec. 149.100, 149.140, and 149.510, from
any grant of forbearance from removal resulting from this subpart, and
from any provision referenced in Sec. Sec. 149.100, 149.140, and
149.510.
[FR Doc. 2023-23716 Filed 10-27-23; 4:15 pm]
BILLING CODE 6325-63-P; 4830-01-P; 4510-29-P; 4120-01-P]