Advanced Explanation of Benefits (implementation of this provision has been delayed)
The “No Surprises Act” (NSA) became effective on January 1, 2022, as part of the Consolidated Appropriations Act, 2021 and was enacted to protect patients from unexpected medical bills resulting from emergency and most non-emergency services rendered by out-of-network (OON) providers.
The Act, in part, sets forth a framework to determine the applicable out-of-network payment amount for emergency and nonemergency services for those claims subject to the No Surprises Act and establishes procedures for resolving payment disputes between providers and insurers using the NSA Independent Dispute Resolution (IDR) process that concludes with a binding arbitration decision.
The statute also requires health plans and insurers to provide an Advanced Explanation of Benefits (AEOB) to the covered member or patient for all scheduled services prior to services being rendered, regardless of whether the services are in or out-of-network. The Advanced EOB must be issued, within certain timeframes, after the provider submits to the plan or insurer a Good Faith Estimate (GFE) of charges for each service. It is important to note, the Advanced EOB requirement for covered services has been delayed pending completion of the technical infrastructure needed to implement these procedures. Future rulemaking is expected.
How Does An Advanced EOB Work?
To meet the Advanced EOB requirements under the No Surprises Act, the health plan must furnish a document to the patient that contains the following information:
- Whether the provider or facility is in-network or OON
- The contracted rate for the service if it is in-network
- A description of where to find information regarding in-network providers or facilities who could provide the service, if any
- A Good Faith Estimate of billed amounts received by the health plan from the provider or facility based on applicable medical billing codes
- An estimate of the amount payable under the plan
- An estimate of the patient’s cost-sharing responsibility
- An estimate of any accrued amounts the patient has already met regarding out-of-pocket maximums and deductibles
- Whether the proposed service is subject to medical management practices such as prior authorization, concurrent review or fail-first protocols
- A disclaimer informing the patient that the advanced list of costs are only estimates
- Any other information deemed appropriate by plan administrators consistent with the No Surprises Act
When Does An Advanced EOB Need To Be Submitted?
Once the Advanced EOB provision is implemented, healthcare plans will be required to provide advanced EOBs to plan participants after receiving notice of scheduled service from the provider or facility.
The timing for the plan to deliver an Advanced EOB depends on when the patient schedules the service:
- If the patient schedules the service three to nine business days before the intended service date, the plan must issue the advanced EOB within one business day after receiving notification from the provider or facility.
- For scheduled appointments that are 10 days or more from the intended date of the service, the plan will be required to provide the Advanced EOB within three business days of notification. The advanced EOB is not a guarantee that the plan will cover the service.
The patient can request an Advanced EOB be delivered either electronically or via postal mail. Further guidance from the agencies is needed to address circumstances such as when the patient does not provide a preference, will the default be electronic and concerns over advance EOBs being sent by mail will likely not arrive before the date of service if scheduled only three days in advance.
Contact Us to Learn More About the Advanced EOB and No Surprises Act
The No Surprises Act and its Advanced EOB provisions will add time, cost and complexity for both providers and insurers. The legal team at Cohen Howard, LLP is available to answer all your questions. Contact us today.
