Medical Economics: Use Technology to Avoid Surprises from the No Surprises Act

August 17, 2021

As an industry, healthcare is moving from its highly complex, opaque landscape to one centered around transparency and delivering clear and straightforward financial experiences to patients. The No Surprises Act (“the Act”), which takes effect January 1, 2022, is another much-needed push for providers to be more transparent about total costs to the patient and eliminate the unexpected medical bills, typically referred to as balance billing, that two-thirds of adults consistently worry about affording. Balance billing occurs when a patient is unknowingly treated by an out-of-network provider and then billed for the difference between the provider’s charges and reimbursement received from payers.

The Act restricts out-of-network facilities and providers from balance billing. especially in cases where the patient was unable to choose an in-network provider such as being transported by ambulance to the nearest facility. While this often happens in emergency situations, balance billing can also occur when a patient visits an in-network facility for a procedure or service and is treated by an out-of-network provider, such as a radiologist administering an MRI.

Even though office-based practices are not directly affected, physicians who perform services at hospitals, outpatient departments, critical access hospitals or ambulatory surgical centers will need to abide by this legislation. This includes providing patients with notice and receiving written consent to bill for out-of-network services and generating “good faith estimates” so patients can manage anticipated costs.

In addition, to remain competitive, providers need to offer price estimator tools, confirm that patients will remain in-network when receiving follow-up services and ensure visibility into billing processes.

To provide the transparency and compliance the Act requires, providers can look to readily available technology to ensure the right data is captured and routed to both patients and providers throughout the care journey. This article will cover three specific technology enhancements providers need to get ahead of the Act and improve the patient experience.

Price estimator tools for creating upfront transparency for non-emergency services.

Given that many patients have lost jobs or health insurance over the past 18 months, today’s health care consumer is highly sensitive to the cost of care and needs to plan ahead. Revenue cycle tools that generate reliable out-of-pocket cost estimates at the time of scheduling can help patients make better financial decisions prior to receiving services. These tools can offer information about how much services will cost when provided by either an in-network or, if necessary, out-of-network provider.

The Act allows providers to balance bill patients for certain out-of-network services so long as they notify patients of—and receive consent for—the expected cost of these services at least 72 hours in advance. This means providers need technology that allows them to flag out-of-network patients and generate the appropriate cost estimates and consent notices the patient needs prior to the services they are receiving. Having individualized cost estimates, instead of a pre-made list of charges that could potentially change based on the service rendered, facilitates stronger trust between the patient and provider, greater patient satisfaction, and better patient collections in the long term.

Verification capabilities to avoid and handle out-of-network exemptions.

In addition to being clear about upfront costs, an important goal of the No Surprises Act is to ensure that more patients are scheduled with in-network providers, when possible, and more active care coordination is taking place. Often, patients have no idea whether they are receiving out-of-network care and will make appointments with whoever their physician recommends. The Act specifically states that when an in-network provider is not available, an out-of-network provider cannot balance bill for services provided. They can, however, still bill for the expected cost-sharing amount that would have been billed if the care was administered in-network. Because of this, it will be critical for facilities to know which providers should be used in a patient’s care journey and automated verification processes should be established within revenue cycle workflows to conduct the appropriate network checks before making referrals or scheduling appointments.

Deliver accurate and compliant billing through automation.

It’s become increasingly evident that the No Surprises Act is a complicated piece of legislation that will require a significant amount of interpretation, especially when determining how to bill patients. The first of three regulations explaining key portions of the Act has been released, but we are still awaiting guidance on the remaining substantial details.

One complicating factor is that 33 states have already enacted laws to protect patients from balance billing. The Act will defer to state laws when applicable, but in some areas, the state law will be preempted if that law does not meet the federal standard. Hence, how patients are billed will need to be managed in light of both state and federal regulations. All this makes it critical for providers to have the operational structures needed to quickly implement and incorporate these rules and regulations into their revenue cycle workflows.

Automation will make this process easier and more reliable. Learning algorithms can consistently determine how to bill patients appropriately using specific rules based on the data being processed. This technology can assess provider type, the location where services were provided, network provisions, etc., and determine the appropriate billing process. Having the ability to hardwire compliant processes in a provider’s revenue cycle is critical because it minimizes the risk of billing errors and ensures claims have all the information needed to be processed successfully.

The No Surprises Act presents a unique opportunity for providers to give patients what they want: more tailored information around pricing, clarity about what’s in- and out-of-network and final bills that are both fair and in line with the patient’s expectations. And while only a little more than four months remains to prepare for this change, providers should think through how a technology-backed, streamlined patient experience can help them stay ahead of consumer demands, remain compliant in an ever-changing regulatory environment and deliver consistency across patient care journeys regardless of how and where they take place.

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