Last Friday, the Defendants in the lawsuit filed by the Texas Medical Association (TMA) against the U.S. Department of Health and Human Services (HHS) and other Federal Departments, entered a notice that the federal departments collectively intend to file an appeal with the United States Court of Appeals Fifth Circuit to challenge the summary judgement issued on February 23, 2022 (ECF No. 114) that ruled in favor of the Plaintiffs.
The original complaint by the TMA was filed October 28, 2021, in the Texas Federal District Court. The lawsuit asserts that the portion of No Surprises Act (NSA) Interim Final Rule (IFR) issued by the Federal Departments, that govern the arbitration process (known as the Independent Dispute Resolution–IDR process) between providers and health plans and health insurers for resolving payment disputes, violated the Administrative Procedure Act (APA). The Court found that the Rule conflicted with the intent of the original statute and “improperly bypassed” the notice and comment requirement under the APA.
In the February 23, 2021 Memorandum Opinion and Order, the Court agreed with the Texas Medical Association that the qualifying payment amount (QPA) presumption under the independent dispute resolution (IDR) provision is inconsistent with the Federal No Surprises Act (NSA), exceeded the Departments’ legal authority and concluded this portion of the Rule to be unlawful and eliminated these provisions for all providers throughout the country who may be subject to them.
Subsequently the Departments reissued guidance that directs arbitrators to consider a number of factors when making a payment determination, without weighing any one factor greater than another, including:
- Provider’s level of training and experience,
- Provider’s quality and outcome metrics,
- Market share of both the provider and/or the insurer,
- Patient’s acuity level,
- Any good faith efforts to enter into a network agreement with the other party,
- Any past contracts rates between the parties during the previous 4 years,
- the QPA for the applicable item or service, and
- any other relevant credible information.
Notwithstanding the new guidance, the Government has filed a notice of appeal within the 60-day deadline, thereby preserving the right to appeal the TMA Court decision. The next step is for the Fifth Circuit Court of Appeals to issue a Briefing Notice upon which the Departments will have 40 days to file a brief. We will continue to provide updates on this and any other developments regarding the NSA.