CMS Releases Interim Final Rule to End Surprise Medical Bills

Bruce D. Armon, Samantha Gross

On July 1, 2021, the U.S. Department of Health and Human Services (HHS), along with several other federal agencies, issued an interim final rule to implement the first of several requirements in the No Surprises Act, which was enacted at the end of 2020. HHS was required to issue rulemaking implementing provisions of the No Surprises Act by July 1, 2021. The interim final rule has not yet been published in the Federal Register; the 60-day ‘clock’ for comments will commence when the interim final rule is in the Federal Register. Subject to any changes made by HHS and/or the other federal agencies, this interim final rule takes effect on January 1, 2022. The interim final rule should be of interest to health care providers, facilities, payors and, of course, to individuals who were affected by these ‘surprises’ in the past when they needed medical care from providers that are outside of their health plan’s network, either in an emergency or non-emergency situation.

​HHS has provided two fact sheets related to the interim final rule available here and here.

This interim final rule implements the first of several requirements in the No Surprise Act, including the following:

  • Banning surprise billing for emergency services; an individual can only be billed based on their health plan’s in-network rate for emergency services, eliminating the requirement for a prior authorization.
  • Eliminating high out-of-network cost-sharing for emergency and non-emergency services, which cannot be higher than if such services were provided by an in-network physician. Any coinsurance or deductible must be based on in-network provider rates.
  • Prohibiting out-of-network charges without providing 72-hour advance notice of estimated charges to patients. Individuals would have to agree to receive out-of-network care for the hospital or doctor to bill them.
  • Barring air ambulance services from sending patients surprise bills for more than the in-network cost sharing amount.

The interim final rule also requires cost sharing to count toward any in-network deductibles and out-of-pocket maximums.

Additional regulations implementing the No Surprises Act are expected later this calendar year. The future regulations are expected to address 1) an independent dispute resolution process that providers and payers will be required to use to resolve billing disputes, 2) specific reporting requirements, and 3) price comparison tools.

Surprise billing can have devastating financial consequences for patients. A 2020 Kaiser Family Foundation report shows about two-thirds of Americans worry they will not be able to pay surprise medical bills. "Health insurance should offer patients peace of mind that they won't be saddled with unexpected costs. The Biden-Harris Administration remains committed to ensuring transparency and affordable care, and with this rule, Americans will get the assurance of no surprises," said HHS Secretary Xavier Beccera.

Because this is an interim final rule, there is opportunity for any interested party to provide timely, written comments which must be received within sixty days after the interim final rule is published in the Federal Register.  

Health care providers and payors and other interested parties that may be impacted by the interim final rule should provide comments to ensure HHS and the other federal agencies understand the impact of the interim final rule and seek appropriate changes.

Saul Ewing attorneys can assist you or your organization in providing comments in response to the interim final rule. Please let us know if you are interested in providing comments. Our attorneys generally advise clients with respect to billing and reimbursement issues.   

For additional information with respect to this interim final rule and the No Surprises Act generally, please contact the authors or the attorney at the Firm with whom you are regularly in contact.

Supplemental Materials
Bruce Armon Headshot
Samantha R. Gross