A Reference Based Pricing plan having direct provider agreements is a network plan as defined by the government………………..
By Molly Mulebriar
As many of you may have come to realize by now there is some confusion among the natives about the implications the new health plan regulations for 2022 will have on Reference Based Pricing plans. This confusion and uncertainty is not unique in this instance as it is shared far and wide among plan sponsors and their third party partners across the country.
Those that say they are not confused are (probably) lying.
Our staff has met with several TPA’s to learn what they believe are the implications these new regulations will have on Reference Based Pricing plans. All conclude that the No Surprises Act applies to Reference Based Pricing plans having direct agreements.
The determination is based on whether a plan is a “network” plan or not. It doesn’t matter if a plan has no out-of-network benefits. The issue is surprise billing, not benefit design. The government definition of “in-network” and “out-of-network” provider can be found here – eCFR :: 45 CFR 147.210 — Transparency in coverage – definitions.
There are two ways to look at the impact the No Surprises Act will have on Reference Based Pricing plans having direct agreements with providers.
Broad View:
A Reference Based Pricing plan having direct provider agreements is a network plan as defined by the government. As a network plan, plan members may encounter out-of-network providers. Out of network providers may balance bill members. Balance bills except for member responsibility (deductible, etc) may be surprise bills subject to the No Surprises Act. Hospitals treating members of plans that are not contracted with them will consider their services to be out-of-network and therefore recourse to independent arbitration is available. In almost every instance non-contracted hospitals will likely demand independent arbitration. This Baseball Arbitration model will always cause a Reference Based Pricing plan to pay more.
How does a plan account for this risk and how does stop loss rate for it?
Narrow View:
A narrow view is less onerous. That view is a Reference Based Pricing plan having direct provider agreements is not a network plan and the No Surprises Act does not apply. Or, the suggestion may be made that since there are no out-of-network benefit differences the plan is not a network plan. Or, balance bills are not necessarily surprise bills by non-contracted providers as members should have known beforehand the provider was not a contracted provider and therefore balance billing should not be a surprise. Or, “not to worry, NSA only applies to emergency room physicians and air ambulance services.”
Which view do you think hospitals will adopt?
Molly Mulebriar is an investigative reporterette from Waring, Texas.
