Will Congress Pass Drug Pricing Legislation Before the Midterms?

Provider Lawsuit Could Tie Up Surprise Billing Regulations

by Peter Johnson

The U.S.’s two largest health care provider groups, the American Medical Association (AMA) and the American Hospital Association (AHA), sued the Biden administration on Dec. 9, asking a federal court to block regulations officials developed to implement the No Surprises Act, parts of which will come into effect on Jan. 1. Health care attorneys tell AIS Health that the suit may hinge on the providers’ allegation that federal officials stretched their legal authority too far beyond the Act’s original intent — and that the providers might win.

Providers Argue QPA Favors Insurers

• The AMA and AHA seek an emergency injunction blocking implementation of the Biden admin’s Oct. 7 interim final rule. Legal experts tell AIS Health that such an injunction could come shortly after the new year. However, if the case goes to trial, it could take years to be resolved, especially if it is appealed.
• Health care attorneys tell AIS Health that the providers’ legal argument centers on the IFR’s guidance on qualified payment amounts (QPAs). QPA is a metric created in the No Surprises Act that is largely based on median in-network reimbursement rates and is one of several factors that arbitrators must consider when deciding a balance billing dispute. 
• “The crux of it is the QPA, which gives the insurers more say in what’s going to be one of the major factors in the dispute resolution process,” explains Raja Sékaran, a health care attorney and partner at Nossaman LLP.
• Sékaran says this argument reveals a real ambiguity. HHS has some leeway in issuing regulations — the question for the judge is how much.
• “I think it’s fair to say in rulemaking, they should try to improve the process and add to the process any sort of detail that could cut down on waste and increase efficiency….It could lead to many different outcomes….[The No Surprises Act] may create its own area of regulatory administrative law in terms of the outcomes,” Sékaran says.

Public May Lose If Providers Win

• Loren Adler, an economist and the associate director of the USC-Brookings Schaeffer Initiative for Health Policy, tells AIS Health that deemphasizing the QPA would be bad for the public.
• “[The AMA and AHA] think if there is less clear guidance in the arbitration decisions…they will make more money,” Adler tells AIS Health. “In turn, consumers will pay higher premiums. That is the central thing they are arguing for.”
• Adler also doesn’t buy the argument that the emphasis on QPA contradicts Congress’ intent. “To somehow expect the cost sharing to systematically diverge from the actual payment would be sort of odd. [The Congressional Budget Office’s] assumptions very clearly rest on arbitration decisions coming out roughly at the QPA.””

From Health Plan Weekly