The federal No Surprises Act (NSA) takes effect on January 1, 2022. In the weeks leading up to the NSA becoming effective, many questions have been asked on how the NSA will work with the existing New York Surprise Bill Law. Generally, the NSA will apply to all patients except those covered by fully insured New York state-regulated plans. Those patients covered by fully insured New York state-regulated plans will still be governed by the New York State Surprise Bill Law, with certain modifications and exceptions.

Regarding the modifications and exceptions, on December 17, 2021, the New York State Department of Financial Services (DFS) issued a Circular Letter that (1) provides guidance on how the NSA will work in conjunction with the New York Surprise Bill Law, and (2) expands the coverage of the New York Surprise Bill Law in certain circumstances. A summary of the key points of that Circular Letter:

Disclosure of Patient Balance Billing Protections

The NSA requires providers to make certain disclosures regarding balance billing protections starting January 1, 2022. The disclosures include postings on provider websites, notices provided directly to patients, and signage at provider locations. The disclosures must provide information about not only Federal balance billing protections, but New York state balance billing protections as well.

DFS has developed a model notice that incorporates New York Surprise Billing Law protections into the federal model notice.

Types of Providers Eligible for IDR

The NY Surprise Bill Law IDR currently applies to emergency and surprise bills from physicians and hospitals. NSA’s federal IDR process applies to all health care “providers,” not just physicians.

Effective January 1, 2022, DFS is expanding the scope of the NY Surprise Bill Law IDR process to apply to (1) bills for emergency services (and inpatient services following an ED visit) rendered by all “providers,” (not just physicians), and (2) surprise bills for services of non-participating “providers” (not just physicians) at participating hospitals and ASCs.

Services Eligible for IDR

The NSA makes certain health care services eligible for the federal IDR process that are not currently covered by the NY Surprise Bill Law IDR process. These services include equipment and devices, telemedicine services, imaging services, laboratory services, and preoperative and postoperative services regardless of whether the provider furnishing the services is at the facility.

Effective January 1, 2022, DFS is expanding the services eligible for NY Surprise Bill Law IDR to include these services.

Safety Net Exemption

Safety net hospitals are currently exempt from the NY Surprise Bill Law IDR process. They are not exempt from the NSA federal IDR process.

Effective January 1, 2022, DFS is permitting safety net hospitals to access the NY Surprise Bill Law IDR process.

Exempt Emergency Service CPT Codes

Currently, the NY Surprise Bill Law exempts certain emergency service CPT codes from its IDR process. There is no such exemption under the NSA’s federal IDR process.

Effective January 1, 2022, DFS is permitting services involving these CPT codes to be eligible for the NY Surprise Bill Law IDR process.

Balance Billing Protections for Emergency Services

The NSA allows patients to waive their balance billing protections for post-stabilization services in certain circumstances. The NY Surprise Bill Law does not permit such waivers.

Accordingly, out-of-network providers rendering post-stabilization services to patients who are covered by fully insured, New York state regulated plans will be unable to use the NSA’s notice-and-consent procedure to enable them to balance bill the patients.

Out-of-network providers rendering post-stabilization services to patients with self-funded coverage will be permitted to waive these protections if the conditions for waiver, including the NSA’s notice-and-consent procedure, are satisfied.

Balance Billing Protections for Surprise Bills

The NSA allows patients to waive balance billing protections for bills from non-participating providers at in-network facilities for non-ancillary services when the NSA’s notice-and-consent procedure is followed. The NY Surprise Bill Law does not permit waiver of these balance billing protections with respect to “surprise bills.” The definition of a “surprise bill” under the NY Surprise Bill Law, however, does not include circumstances where a participating physician is available but the patient elects to receive services from a non-participating physician. DFS has clarified that patients must have at least 72 hours’ notice of availability of a participating physician for a subsequent bill from a non-participating physician to not fall under the definition of a surprise bill.

Accordingly, out-of-network providers rendering services at in-network facilities to patients who are covered by fully insured, New York state-regulated plans are only able to use the notice-and-consent procedure to balance bill if there was a participating physician available to provide the services, and the patient was provided at least 72 hours’ advanced notice of that participating physician’s availability to provide the services.

Out-of-network providers rendering services at in-network facilities to patients with self-funded coverage are able to use the notice-and-consent procedure to balance bill.

Provider Hold Harmless

The NSA prohibits providers from balance billing patients for more than the applicable cost-sharing for out-of-network emergency services and for services from a non-participating provider in a participating facility except where the balance billing prohibition is waived in accordance with the NSA under the notice-and-consent requirement. The NY Surprise Bill Law provides a similar balance billing ban, but ties the ban to the patient’s completion of an AOB. Also, under the NY Surprise Bill Law, the insurer’s obligation to send payment directly to the provider is triggered by the patient’s completion of an AOB. In order to comply with the NSA, DFS has eliminated the requirement of the patient completing an AOB to be protected against balance billing and for providers to be paid directly.

Thus, effective January 1, 2022, there is no need for patients to complete an AOB to trigger New York Surprise Bill Law protections or its IDR process.