No Surprises Act – Tarrant County Physician Online

TMA Pleased Court Strikes Down Steep Fee Hike and Batching Rules in NSA Cases

Statement by Rick W. Snyder II, MD, Texas Medical Association (TMA) president, in response to the ruling by the U.S. District Court for the Eastern District of Texas on TMA’s fourth No Surprises Act lawsuit. TMA challenged a 600% hike in administrative fees and batching rules used in arbitration cases governed by the federal law. TMA argued the case in the U.S. District Court for the Eastern District of Texas Tyler Division on April 19. TMA has filed four lawsuits against federal agencies related to rulemaking under the federal surprise-billing arbitration law pertaining to certain out-of-network care.

“We are pleased a federal court has once again agreed with the Texas Medical Association (TMA) in finding the federal agencies acted unlawfully when implementing provisions of the No Surprises Act (NSA). In TMA’s latest case, the court determined the federal agencies violated the notice and comment requirements of the Administrative Procedure Act when imposing 600% higher fees on physicians seeking arbitration in disputes with health insurers under the federal NSA.

“The federal agencies set the initial administrative fee at $50, saying last October the fees would remain at that rate through this year. However, just two months later, the agencies announced the fee would jump to $350 beginning in January 2023. TMA believes this unfair steep jump in fees has dramatically curtailed many physicians’ ability to seek arbitration when a health plan offers insufficient payment for out-of-network care.

“Likewise, TMA is pleased the court decided, based on a lack of notice and comment, to invalidate certain rules narrowing the law’s provisions on ‘batching’ claims for arbitration. Congress authorized batching in the law to encourage efficiency and minimize costs in the independent dispute resolution process. It is vital the law be applied as Congress intended.

“While the court declined to provide deadline extensions and certain other requested relief, we remain pleased with the overall outcome. Yesterday’s decisions on batching rule provisions and administrative fees will aid in reducing barriers to physician access to the law’s arbitration process, which is vital to both patient access to care and practice viability.”

TMA filed this lawsuit in January 2023.

TMA’s first lawsuit challenging the No Surprises Act rules – filed in October 2021, and which TMA won at the federal district court level – alleged that in the interim final rules governing arbitrations between insurers and physicians, the agencies unlawfully required arbitrators to “rebuttably presume” the offer closest to the qualifying payment amount (QPA) was the appropriate out-of-network rate.

TMA filed its second lawsuit in September 2022 challenging the NSA’s August 2022 final rules published by the federal agencies, alleging the final rules unfairly advantage health insurers by requiring arbitrators to give outsized weight or consideration to the QPA. The court ruled in TMA’s favor on that case in January 2023. This lawsuit is currently being appealed by the federal government to the Fifth Circuit.

TMA filed its third NSA rules lawsuit in November 2022 challenging certain portions of the July 2021 interim final rules implementing the federal NSA. This lawsuit is pending a decision at the district court level.

TMA is the largest state medical society in the nation, representing more than 57,000 physician and medical student members. It is located in Austin and has 110 component county medical societies around the state. TMA’s key objective since 1853 is to improve the health of all Texans.

TMA Pleased by U.S. District Court Ruling Granting Summary Judgment Motion

Court Agrees With Physicians’ Argument
in Federal No Surprises Act Rule Case

Statement by Gary W. Floyd, MD, Texas Medical Association (TMA) president, in response to the U.S. District Court for the Eastern District of Texas ruling on TMA’s motion for summary judgment in its lawsuit opposing certain components of federal regulatory agencies’ final rules regarding dispute resolution under the No Surprises Act. TMA argued the case in the U.S. District Court in December, addressing the second of four TMA lawsuits against federal agencies related to rulemaking under the surprise-billing arbitration law.

“TMA is pleased the court granted its motion for summary judgment in its lawsuit challenging certain components of the federal agencies’ final rules relating to the federal independent dispute resolution (IDR) process under the No Surprises Act. This is an important next step after TMA successfully challenged an interim final rule that similarly skewed the IDR process in health plans’ favor.

“This decision is a major victory for patients and physicians. It also is a reminder that federal agencies must adopt regulations in accordance with the law.

“The decision will promote patients’ access to quality care when they need it most and help guard against health insurer business practices that give patients fewer choices of affordable in-network physicians and threaten the sustainability of physician practices.”

New TMA Lawsuit Challenges Big Fee Hike in “No Surprises Act” Arbitration

Fourth Lawsuit Disputes 600% Fee Hike Demanded of Doctors

The Texas Medical Association (TMA) is challenging a 600% hike in administrative fees for seeking federal dispute resolution in No Surprises Act (NSA) situations. TMA seeks relief by filing a fourth lawsuit in the U.S. District Court for the Eastern District of Texas.

This TMA lawsuit against federal agencies challenges a steep administrative fee hike that will strip many physicians and healthcare providers of the arbitration process that Congress enacted. TMA calls the fees “arbitrary and capricious,” contrary to the law, and in violation of notice and comment requirements.

The U.S. departments of Health and Human Services, Labor, and the Treasury, and the U.S. Office of Personnel Management collectively adopted interim final rules implementing the federal surprise-billing law. The rules include establishing the nonrefundable administrative fee all parties must pay to enter the federal independent dispute resolution (IDR) process in the event of a payment disagreement between an out-of-network physician or provider and a health plan in circumstances covered by the law. The situations could occur when emergency services are provided by a doctor or health care provider outside of the patient’s insurance network or when out-of-network services are provided at an in-network facility.

The federal agencies set the initial administrative fee at $50 and announced in October 2022 it would remain at $50 for 2023. Two months later the agencies announced a 600% hike in the fee to $350 beginning in January 2023, “due to supplemental data analysis and increasing expenditures in carrying out the Federal IDR process since the development of the prior 2023 guidance.”

The steep jump in fees will dramatically curtail many physicians’ ability to seek arbitration when a health plan offers insufficient payment for care.

“The problem is that many payment disputes in these cases amount to less than the fees physicians would have to pay to dispute the unfair payments,” said TMA President Gary W. Floyd, MD. “Why would doctors and providers pay the $350 nonrefundable administrative fee to arbitrate a $200 or so payment dispute with a health insurer? The fees deny physicians the ability to formally seek fair payment for taking care of our patients, and that’s just wrong.”

TMA argues the administrative fee hike is difficult for all physician specialties to bear, but especially those specialties that have more small-dollar claims, such as radiology.

The non-refundable administrative fee is in addition to the separate fee that each party must pay the IDR entity for its services, though that fee is refundable to the party that wins the arbitration dispute.

TMA also disputes the rules’ narrowing of the law’s provisions on “batching” claims for arbitration, which Congress authorized to encourage efficiency and minimize costs in the IDR process.

TMA’s first lawsuit – filed in 2021, and which TMA won at the district court level – alleged that in the interim final rules governing arbitrations between insurers and physicians, the agencies unlawfully required arbitrators to “rebuttably presume” the offer closest to the qualifying payment amount (QPA) was the appropriate out-of-network rate. TMA filed its second lawsuit in September 2022 challenging the NSA’s August 2022 final rules published by the federal agencies, alleging the final rules unfairly advantage health insurers by requiring arbitrators to give outsized weight or consideration to the QPA. The court’s ruling on that suit’s December 2022 hearing is anticipated at any time. TMA filed its third lawsuit in November 2022 challenging certain portions of the July 2021 interim final rules implementing the federal NSA. No hearing date has been set for that case, which challenges certain parts of the rules that artificially deflate the QPA.