In this episode, we are joined by Bill Kampine Co-Founder and Chief Innovation Officer at Healthcare Bluebook to help us understand more about The No Surprises Act and its implications for providers.
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Highlights of this episode include:
- Who is Healthcare Bluebook
- Overview of the No Surprises Act
- Complying with the law challenges
- Increased transparency
Mike Passanante: Hi, this is Mike Passanante and welcome back to the award-winning Hospital Finance podcast. The No Surprises Act took effect January 1st, 2022, and this new batch of healthcare transparency regulations could help protect consumers from surprise hospital bills. To help us understand more about this initiative and its implications for providers, I’m joined by Bill Kampine. Bill is the co-founder and chief innovation officer at Healthcare Bluebook. Bill is a healthcare economist by training and a serial healthcare entrepreneur with over 25 years of experience. He has been deeply involved at the state and federal levels, helping to shape healthcare price transparency policy and regulations. Bill, welcome to the show.
Bill Kampine: Thanks, Mike, for having me on the podcast today. I’m really excited to be here.
Mike: Looking forward to your perspectives, Bill. But before we dive in, why don’t you tell us a little bit about Healthcare Bluebook and what you do there?
Bill: Sure. Yeah. Well, we founded Bluebook in 2007 with a pretty simple purpose: really, to protect patients by exposing the truth about price and quality differences, and then making sure that they have the tools that consumers need to navigate to better value in the healthcare system. And since that time we’ve grown to be one of the largest providers of healthcare price and quality navigation solutions. And so our clients are self-insured state and municipal employers, self-insured Fortune 500 employers, third-party administrators, and regional health plans. And we also provide cost and quality measurement solutions to hospitals and providers through our Quantros suite of solutions. And, importantly, we offer solutions that enable hospitals to deliver on their price transparency rule requirements.
Mike: Appreciate that, Bill. And my next question’s probably a little bit to unpack, so let’s take our time and work through it. I’d like to see if you can give us a brief overview of the No Surprises Act, particularly what’s expected of the providers under the law, as of January, and what might be coming up over the next year.
Bill: Yeah. Absolutely. So the No Surprises Act is only the most recent of what I would consider three major federal policy initiatives related to price transparency. The first, and I’m sure your listeners are very familiar with it, is the hospital transparency rules that went into effect in 2021. The second is the transparency in coverage rules that begin to go into effect later this year. And, of course, the third is the No Surprises Act that was passed in December of ’21 as part of Consolidated Appropriations Act. Most of the language in the No Surprises Act really began life as the bipartisan Lower Health Care Costs Act or bill that was drafted in 2019. And that was following a series of Senate Health Committee hearings in 2018 on how to reduce the growth in healthcare costs in the United States. And so the No Surprises Act itself has quite a few provisions, but the major provision that providers and plans will have to navigate in 2022 is, really, the elimination of patient surprise billing when patients unknowingly use out-of-network providers at in-network facilities, so in-network hospitals or hospital outpatient departments or ambulatory surgery centers, or when the patient is in a circumstance where they must receive treatment like an ER or an air ambulance. And so the act ensures that patients only pay their in-network cost sharing amount, even if they unknowingly used an out-of-network provider. And it also prohibits the out-of-network providers, importantly, from balance-billing patients. Right? That’s always a huge dissatisfier. And where this typically happens is with provider specialties– anesthesiology would be a great example– radiologists– sometimes ER attending docs.
The act also provides a process for patients to waive their protections. Right? So if they’re informed ahead of time that this provider is out-of-network, they can still choose to go through with that care. However, providers must furnish to the patient an estimate of the out-of-pocket costs for that out-of-network care ahead of time, as part of that waiver. The act provides a methodology for providers and insurers to negotiate reimbursement, as well as an independent dispute resolution process, commonly referred to as an IDR, in the event of a dispute. And so the dispute resolution uses a baseball-style arbitration process, right, where both sides submit a price, and then a determination is made. But on the payer side, the payment is based on what is called the qualifying payment amount. And that is the median, essentially, of the contracted rates for the same service delivered by the same specialty or similar specialty for that particular service. And so all those rates, right– that qualifying payment rate has to be calculated for the same MSA or the same metropolitan area, and there are a couple of other requirements that go with that. Now, there are other notable provisions in the act that will impact providers, plans, and employers. Many of these other provisions are awaiting regulatory guidance that we anticipate to be forthcoming in 2022. And so as we look sort of down the road, in terms of what’s coming, some of these include the requirement for providers to inform patients of network status and provide an estimate of bill charges at the time that they schedule a service for a patient.
That requirement is closely linked to the plan requirement to provide the member with an advanced explanation of benefits, or an EOB, with the estimated in-network price and the patient’s out-of-pocket estimate prior to care. Now these requirements– and there are other requirements that, of course, will impact both the plan and the provider, but they require data exchange with the plans. They require details on how the information will be provided to the member. And we anticipate more regulatory guidance and implementation guidance on that in the coming year, but that will be coming down the pike. There are a host of other requirements that impact plans and employers as well. These include the provision for plans and self-insured employers to provide a consumer transparency tool. Those requirements are very similar to the consumer tool requirements outlined by the transparency in coverage rules. There are also provisions related to provider directory, accuracy, data reporting – let’s see – elimination of gag clauses for employers in contracts that are signed between the plan and the providers. And there are a variety of other initiatives. And for many of those initiatives, again, as we look at the timetable, there has not been interim final guidance released. And so we’re expecting regulatory feedback and guidance on that in 2022, potentially with implementation by the end of 2022 or into 2023.
Mike: Bill, you’ve been working with providers and other organizations to help them comply with these laws. What are some of the challenges you’ve encountered?
Bill: So we do offer solutions that enable providers, payers, and self-insured employers to ensure compliance across all three of those major transparency initiatives, but specifically for providers in the No Surprises Act, I think there are a number of challenges. First, the initial phase of the act– it has a lot of moving pieces and requirements, and so it’s important to stay on top of the final interim rules which have been issued– the proposed rules, which, honestly, I haven’t checked on in a while. I can’t recall if feedback is still open on those. And then there’s ongoing implementation guidance being released by the departments. And so I think it’s important to stay on top of those changes and those guidance to make sure that everybody is on target. Second, the near term focus is really the surprise billing piece, but we also need to prepare for forthcoming guidance on other provisions like, again, the advanced explanation of benefits, and begin to plan for how that will impact both plans and providers. And so it’s not as if we implement surprise billing provisions, and then we’re done. Right? There’s more work coming down the pike on this. Lastly, many states have existing surprise billing laws and requirements that are currently on the books. And so keeping track of the local versus federal requirements requires quite a bit of work, as well as understanding who is the enforcement authority for each of the rules. And that’s a big task, in terms of just keeping track and keeping that in mind and building it into one’s compliance response.
Again, on the payer and employer side, there are also a number of challenges. Many of our payer clients are working through the qualifying payment process and understanding the data sources. I think there’s a lot of opinions there. And, to an extent, I think the payers will have an even larger bucket of work to do in 2022 when we receive guidance on a number of the additional provisions beyond surprise billing. I had mentioned it before, but, again, the advanced EOB, the directory accuracy requirements, and there are some requirements about pharmacy price reporting back to the departments. Stepping back and thinking more broadly about the full constellation of federal transparency initiatives, there’s also a lot of work to be done in managing the requirements across both the No Surprises Act and the transparency in coverage rules, because there is some overlap. And so as an example– and, again, I mentioned this earlier, but both transparency in coverage and No Surprises have a requirement for a consumer transparency tool. And if you look at these, right, a lot of the features are largely duplicative. So we’ve worked with our clients, as well as the departments and industry advisory groups – and there are several of those in Washington – just to make sure that we’re gaining clarity on the requirements across the constellation of initiatives to ensure that our clients, be they third-party administrators or plans or self-insured employers– that they’re not doing duplicative work, specifically with the transparency tools. Ideally, an employer payer can satisfy the No Surprises tool requirements when they meet the transparency in coverage requirements for a consumer tool.
Mike: Bill, are providers and other entities embracing this increased transparency, in your view?
Bill: I think the rate of adoption is a bit mixed, but, overall, the trend is really toward more transparency; and to me that makes sense. Again, looking at the three major policy initiatives, transparency is a topic that’s clearly not going away. In the case of the hospital transparency requirements, hospitals have clearly taken different approaches. There are systems that feel strongly that they are offering high-quality and cost-competitive services, and as a result, they’re choosing to embrace that advantage and generally publishing more than what is required. Right? There’s a requirement of 300 services, but some of these hospitals – and we do have some of these clients – really view this as an advantage. Right? And they want those cases, and they want those cases from, for example, their local employers, so they’re being very aggressive. But at the same time, I think it’s also been well-documented by Kaiser Health and others that some hospitals are going to take a wait-and-see approach until there’s some evidence of enforcement before they begin to engage. My perspective on the No Surprises Act is that we’re a little early. I don’t see a lot of disagreement from providers in our conversations, in terms of patients needing to know network status and having information ahead of time, but there are generally two concerns. I mean, there are certainly more than that, but I think the first is timing. There are a lot– there are a large number of requirements, and it requires data flows that have not necessarily been worked out yet, not to mention, again, the layers of rules, right, between federal transparency and state level transparency and the oversight authority. So I think it’s a lot of work to get done in a short period of time.
The second is I think there’s, maybe, a little bit of pushback on the IDR process and the calculation of the qualifying payment amount. My sense there, though, is that that will ultimately get worked out.
Mike: Bill, getting an accurate price for just about anything in healthcare is notoriously difficult, in terms of actual cost. Do you think the information that’s making its way to consumers through this initiative will improve their ability to make more informed decisions?
Bill: Yeah. Absolutely. The most recent Kaiser numbers I’ve seen, I think, show two in three adults worry about surprise bills. Just speaking as Bluebook, with more than a decade of working with consumers, we’ve learned that, to your point, right, the inability to correctly anticipate healthcare costs is a massive dissatisfier for patients, and it even causes some patients to avoid care over that fear. In addition, the out-of-network charges can be significant. I’ve certainly experienced those, and it’s a bit of a shock. And we know that those charges are a contributing factor to financial distress, so eliminating surprise bills, I think, is good for consumers. Equally important, taking the many separate transparency initiatives within the No Surprises Act. Remember, there are two titles and quite a few separate initiatives, but taking them as a whole– this is a big step towards helping self-insured employers and consumers get more value from healthcare. From my seat, the concepts, particularly the required transparency tools, really aren’t new. Right? For more than a decade, at Bluebook, we’ve been working with employers and consumers to provide intuitive cost and quality tools, value-based incentives that reward the use of high-value care, and member engagement programs. And I think the results are pretty clear. Right? When we use best practices we see high levels of member engagement. And we can show– we can calculate hard dollar savings both for the plan and for the member individually. So I think the information is foundational, but when put into practice with best practices, absolutely, I think consumers get the value that we’re looking for.
Mike: And to that end, do you think there are additional steps that providers or payers or other entities in the ecosystem could take to help consumers understand their healthcare costs better?
Bill: I do. Ultimately, the goal of transparency initiatives like the hospital rule, the transparency in coverage rules, or the No Surprises Act are really to protect consumers, increase transparency, and reduce overall costs for both the plan and the individual member. The focus of all of these initiatives has really been on cost with no provision for quality, and I think that’s a miss. Achieving value in healthcare is sort of a three legged stool, and it’s comprised of cost, right, which this covers, quality, and appropriate or efficient care. And that’s really where we have focused as Bluebook. And so, again, as I think about it, for plans and self-insured employers that have to be compliant, I would encourage payers and employers to look beyond check-the-box compliance solutions, with regard to the No Surprises Act, and even the Transparency in Coverage Act, and to take an approach that navigates members based on value. Right? You have a network. We know that there are price differences. We know there are quality differences. We know that there are significant amounts to be saved for the plan and the member by using high-quality, cost-effective providers within that network, or perhaps even accessing them directly. But it has to incorporate a couple of elements. Right? Member navigation that’s based on both cost and quality. The tools aren’t helpful if members don’t use them, right, so demonstrated techniques for member engagement. That’s really important. And there’s an important role for benefit design. Right? So I’m a big proponent of value-based benefit designs that incent use of high-value care. And those could be shared savings programs, or there’s a number of different ways of doing it.
Lastly, again, on the plan and payer side, as care gets more complex, it’s harder for patients to navigate. And so ensuring that members have both the incentive, the tools, the engagement, but also the member support they need to navigate that network and get to the better-value care. I think similarly, for providers, the idea is to compete both on cost and quality. Cost is only one dimension. In our experience, and particularly through our Quantros brand, we, for quite a few years, have offered a full suite of solutions that enable providers to measure benchmark, and work to improve their cost profile and their clinical quality. And with that information, right, that allows providers to be confident in competing both on cost and quality. But sometimes that takes an independent lens in order to understand that.
Mike: Great perspectives, Bill. And if someone wanted to find out more about Healthcare Bluebook, where can they go?
Bill: Sure. Listeners can find us on our website. That’s healthcarebluebook.com. On the website, they’ll find comprehensive information about our cost and quality solutions, including Bluebook Comply, which we’ve talked about today, which is designed to help companies get ahead of the transparency regulations. And, again, that’s for plans, self-insured employers/providers. The site also has blogs and information on our whole suite of solutions, from prescription drug cost containment to benefit design and employee engagement. So there’s a lot there, and that can all be found on our website.
Mike: Fantastic. Bill Kampine, thanks so much for joining us today on the Hospital Finance Podcast.
Bill: Thanks for having me, Mike. It’s been a real pleasure.
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