Two leading healthcare associations have brought a new lawsuit against the federal government over the “misguided implementation” of a key provision in a rule designed to eliminate surprise medical bills.
The American Hospital Association (AHA) and American Medical Association (AMA) filed the complaint Thursday, Dec. 9. Renown Health, UMass Memorial Health and two North Carolina physicians have joined the pair in their fight to amend the independent dispute resolution process for surprise bills that they say “unfairly” benefits insurers.
Specifically, the concern is that the process directs independent arbitrators to presume an insurer's median in-network rate is also the appropriate out-of-network rate when beginning billing disputes, while also limiting the significance of other factors such as complexity of care and the treating physician.
“Congress established important patient protections against unanticipated medical bills in the No Surprises Act, and physicians were a critical part of the legislative solution,” AMA President Gerald E. Harmon, MD, said Thursday. “Our legal challenge urges regulators to ensure there is a fair and meaningful process to resolve disputes between healthcare providers and insurance companies.”
The U.S. Department of Health and Human Services issued the narrow provision on Sept. 30, with the rule set to take effect this coming January.
Melinda Hatton, general counsel for the AHA, and the association’s Group Vice President for Public Policy Molly Smith co-wrote a blog on Thursday arguing that their concerns are already taking place. In November, Blue Cross Blue Shield of North Carolina warned a group of providers that it would terminate their contract if they did not accept lower in-network payment rates, citing surprise billing regulations as means to achieve those rates.
“The fix here is simple: Align the regulations with what Congress intended and make the process for resolving disputes fair and equitable for both sides,” Hatton and Smith wrote. “That is not only the right thing, but it also will avoid the kind of negative consequences for patients Congress sought to prevent.”
The American College of Radiology and other provider groups have expressed similar concerns with the rule. And the Texas Medical Association filed suit in October to stop an interim version of the final rule from proceeding.
Additionally, a bipartisan group of 150 members of the U.S. House signed a letter last month pressuring the Biden administration to revise the arbitration process. Despite these calls, HHS Secretary Xavier Becerra has defended the provision, claiming broadening the process may increase costs.
You can view the lawsuit filed by the AHA and AMA here. Read the entire blog post here and a breakdown of the lawsuit here.
Matt joined Chicago’s TriMed team in 2018 covering all areas of health imaging after two years reporting on the hospital field. He holds a bachelor’s in English from UIC, and enjoys a good cup of coffee and an interesting documentary.