I understand that the Surprise Billing case that was discussed in this week’s HLE arose before the No Surprises Act (“NSA”) went into effect. How would the NSA have affected that case?
OUR ANSWER FROM HORTYSPRINGER ATTORNEY HENRY CASALE:
While the case of the $229,112.13 surprise bill arose before the January 1, 2022 effective date of the NSA, it is interesting to see how the facts in that case would be affected if they happened after January 1, 2022.
The case does not state whether the patient’s surgery was emergency or elective. However, the fact that the hospital and the patient were able to agree that the amount the patient would owe the hospital for that surgery was to be $1,336.90, leads us to assume that it was an elective surgery. Based on that assumption, let’s explore what would happen if the same set of facts were to occur after the NSA went into effect.
First, there was a mix-up as to the patient’s insurance coverage. Apparently, the hospital first thought that the patient was in-network and that was the basis for the $1,336.90 agreed-upon price. It was only after the surgery was completed that the hospital realized that the patient was out-of-network and that based on the hospital’s charge master the hospital claimed that the patient owed the hospital $229,112.13.
When the patient refused to pay this amount, the hospital sued. The jury not only sided with the patient, but it also decided that the agreed-upon price was too high and determined that the amount that the patient owed the hospital was only $766.74. You should be aware that the appellate court disagreed with the trial court and reversed the jury verdict, reinstating the hospital’s demand. However, the Colorado Supreme court reversed the appellate court and reinstated the jury’s verdict. So, after being forced to expend legal fees and the anxiety that resulted from the appellate court decision, the patient’s final amount due was $766.74.
Under the NSA, the result would be very different. Again, assuming this was a non-emergency surgery, the hospital would have been required to make an affirmative determination before the surgery whether the patient was in-network or out-of-network. If the patient was out-of-network, then the patient would be considered uninsured (or self-pay). At this point, the hospital is required to provide the self-pay patient with a good faith estimate that includes a list of all of the items or services that are reasonably expected to be furnished in conjunction with the surgery and the cost of that care.
When the good faith estimate must be provided depends on when the surgery was scheduled. If the surgery is scheduled at least three business days before the date of surgery, then the good faith estimate must be provided no later than one business day after the date of scheduling. If the surgery is scheduled at least 10 business days before the date of surgery, then the good faith estimate must be provided no later than three business days after the date of scheduling. If a good faith estimate is requested by the self-pay patient, then the good faith estimate must be provided no later than three business days after the date of the request. In any event, the patient must be made aware of the cost BEFORE the surgery – no longer will a patient wake up from surgery only to be informed that their bill would be much greater than the good faith estimate.
In addition, under the NSA, a patient who is involved in a dispute with a provider over the cost of the care provided pursuant to the good faith estimate, is not required to go to court or incur the costs of litigation. If the difference between the amount of the good faith estimate, and the actual bill is more than $400, then the NSA entitles the patient to arbitrate the dispute. This result is best illustrated by the following question and answer taken for CMS’s Center for Consumer Information & Insurance Oversight presentation on the NSA:
Tonya is a 40-year-old female with a long history of right knee pain. She does not have any form of health insurance. Tonya schedules an appointment with her orthopedist to receive a cortisone injection in her knee. Upon scheduling the appointment, her orthopedist sends her a good faith estimate. The good faith estimate lists the total expected charges of $300 for the procedure. Tonya undergoes the injection and subsequently receives a bill from the orthopedist. The total billed charge is $850.
Would Tonya be eligible to pursue the PPDR (Arbitration) process?
ANSWER: Yes, Tonya would be eligible to pursue the PPDR (Arbitration) process. Tonya is uninsured, and the total billed charge is considered substantially in excess of the good faith estimate, since the difference between the total expected and total billed charges is greater than or equal to $400. Under the NSA, in order to be eligible to pursue the PPDR (Arbitration) process, an individual must be considered uninsured or self-pay, the total billed charges by the particular convening provider, convening facility, co-provider, or co‑facility, must be substantially in excess ( > $400) of the total expected charges for that specific provider or facility listed in the good faith estimate, and the date of the bill must be within 120 days.
Confirmation of insurance status before the surgery, advance notice of all services, a good faith estimate of all costs to the self-insured patient which must be reasonable charges not an inflated charge based on the hospital’s charge master, and the right to arbitration if there is more than a $400 difference between the patient’s bill and the good faith estimate – yes, the case in this week’s HLE would have turned out very differently once the NSA went into effect on January 1, 2022.