Judge rules on No Surprises Act
Says Qualified Payment Amount “places its thumb on the scale.”
On Wednesday, a federal court sided with the Texas Medical Association, striking down the Interim Final Rule (IFR) for the No Surprises Act (NSA). Several healthcare providers have filed lawsuits since October 2020 challenging the Department of Health and Human Services interpretation of the law passed by Congress.
Presiding Judge Jeremy Kernodle said that the IFR “places its thumb on the scale” for the Qualified Payment Amount. He also ruled that HHS also failed to issue notices and comment periods on the IFR.
The Qualified Payment Amount (QPA) is the median in-network rate set by health insurers. Last fall, HHS Secretary Xavier Becerra issued the IFR which claimed that the Qualified Payment Amount (QPA) would be the best way to determine how much doctors could get paid for a service. The Texas Medical Association and other groups have taken issue with this.
Under the IFR, doctors would not have been allowed to reference Medicare rates and it would have limited the other types of evidence to support their case for payment. Instead, the QPA would have been the only reference point for how much a procedure was worth. This would have given significant power to insurance companies to determine what they were going to pay for a particular service.
As we wrote back in January, the NSA was designed to encourage more contracts between doctors and payors, but the IFR had created the opposite effect. Blue Cross and Blue Shield of North Carolina sent letters to multiple groups demanding a rate decrease or risk being kicked out of the network. Even bipartisan members of congress wrote to Mr. Becerra explaining that his IFR was not representative of the law they had passed in 2020.
Reaction to the judge’s ruling has been mixed. Diana Fite, MD, the immediate past president of the Texas Medical Association said the decision was “an important step towards restoring the fair and balanced process that Congress enacted to resolve surprise billing disputes between health insurers and physicians.”
Matt Eyles, president and CEO of America’s Health Insurance Plans – a lobbying group that submitted amicus curae briefs in support of the HHS – said that providers “have sued to stop the implementation of rules that would lower the cost of healthcare of everyone, defending their own financial interests over the consumers and patients they serve.”
Mr. Eyles also alleged that this ruling would result in higher healthcare costs for patients, however there is little evidence to support this claim. FLATLINING has discussed in the past which provider specialties are the highest paid. The types of specialties covered under the NSA (emergency medicine, radiology, and anesthesia) are not in the top three.
This ruling is a victory for doctors in these three specialties. As we have written before, when doctors and groups must take a pay cut, it limits the services they provide. It limits their quality and their quantity. This is detrimental to patients.
FLATLINING has published a few articles recently discussing the economic conundrum publicly traded insurance companies face. The only costs that the IFR would have lowered was the costs to the insurance companies because it effectively gave them the power to dictate what they would pay for a service.
Yesterday’s ruling is a victory for both patients and doctors. Doctors can continue to advocate for fair compensation for the quality care they provide, and patients will still have access to that care. The only thing lost here is the pride of the HHS and some profits for the insurance companies.