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      No Surprises Act: Two Years Later, IDR Process Results and How Providers can Prepare for Success

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      It has been a little more than two years since the No Surprises Act was implemented, with provisions designed to address unexpected gaps in insurance coverage that result in “surprise medical bills” when patients unknowingly obtain medical services from physicians and other providers outside their health insurance network.

      While the law was primarily created to help patients avoid unexpected medical costs, another aspect of the law is an independent dispute resolution (IDR) process to adjudicate disputes between insurers and providers over payment for affected out-of-network services.

      What are the steps of the IDR process?

      The process comprises several key components:

      1. Open Negotiation Period
        This is a 30-day period that precedes IDR and allows payers and providers to resolve payment disputes without involving a third party. However, settlements during this period are uncommon, as per a Government Accountability Office (GAO) report, rendering this phase largely ineffective.
      2. Selection of IDR Entity
        After the open negotiation period, the payer and provider select an Independent Dispute Resolution (IDR) entity from a certified list, ensuring no conflicts of interest exist.
      3. Information Compilation
        Parties must gather all relevant details related to the disputed items or services, including a comprehensive explanation of benefits, claim numbers and an attestation confirming the dispute's eligibility for IDR. The initiating party must provide the non-initiating party's contact information.
      4. Objection Process
        Non-initiating parties, typically payers, can object to the selected IDR entity within three days of receiving the Notice of IDR Initiation. Failure to propose an alternative entity within the stipulated timeframe results in automatic approval of the initial selection.
      5. Submission of Payment Offers
        Payers and providers submit their payment offers, along with supporting evidence, to the IDR entity and pay the fixed administrative fee set at $115 per party, as per CMS guidelines.
      6. Decision Making by IDR Entity
        The IDR entity evaluates the offers based on various factors, including determining the Qualifying Payment Amount (QPA), considering factors like in-network contracted rates and market dynamics, but excluding public payer rates. Parties can opt for batched or individual line-item determinations, with a fixed tiered fee applicable for multiple batch submissions.
      IDR process: By the numbers

      Since 2022, the IDR process has helped settle reimbursement issues between providers and payers. Here are a few of the significant statistics from the first two years of the IDR process:

      Most common IDR cases

      So far, there’s a clear trend for what services are most commonly going through an IDR process – emergency services. According to a CMS report, emergency services accounted for 71,513 disputes, or 66% of all total disputes.

      Ancillary services also were significant with 16,932 disputes.

      How providers can stay prepared for the IDR process

      Although providers are winning IDR cases at a high rate, it’s imperative to be prepared for the arbitration process. Here are a few ways to stay prepared and best position your organization to emerge victorious in the IDR process:

      Conduct consistent reviews of your chargemaster
      At a minimum, the CDM should be reviewed quarterly. For example, if a particular procedure or service falls in the 80th percentile nationally in terms of the amount charged, is your team able to defend your chargemaster? Consider the eight factors CMS says can help you charge higher, such as whether you’re a sole provider or specialty provider, or your organization is in a service area with a higher cost of living.

      Review self-pay and charity care workflows 
      Billed amounts are usually allocated to three main categories: payments, charity or bad debt. For healthcare organizations, optimizing the allocation towards payments or charity is crucial. A key step in this process is generating precise Good Faith Estimates (GFEs) promptly within your workflows. Analyzing these workflows, potentially leveraging technology to differentiate between self-pay and charity care for potential bad debt, can proactively address disputes down the line.

      Have technology in place to make sure processes are repeatable
      By implementing an advanced, automated system that handles upfront processes like estimates, self-pay validations and charity care, you can streamline workflows and prevent redundant tasks for patients. Conducting self-pay estimates with an estimator can also bolster your defense during IDR disputes while enabling providers to efficiently verify timely provision of good faith estimates. Leveraging technology equips healthcare organizations with robust documentation to demonstrate adherence to communicating rates effectively to patients.

      Looking ahead

      Although most cases don’t enter the IDR process, the backlog of disputes has spurred the federal government to explore changes designed to speed up the system.

      The proposed rule, if finalized, would improve communications between payers, providers and certified IDR entities who make payment determinations; adjust Federal IDR timelines; establish new batching criteria; create a more efficient Federal IDR process; and change the administrative fee structure to improve accessibility of the process.

      As of now, the providers’ high win rate will likely impact how providers and payers both approach IDR going forward. Payers may raise their offers in hopes of winning more often, and providers may raise their offers in hopes of receiving higher prices.

      Learn how FinThrive helps healthcare organizations maintain revenue integrity with industry-leading charge capture and chargemaster technology.


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