# Bulletin No. 2021–42 > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/agency%3Airs%3A45404747f8b4e7b2 ## Record - **Collection:** Agency decision - **Document type:** Agency decision ## Text HIGHLIGHTS OF THIS ISSUE   Bulletin No. 2021–42 October 18, 2021 These synopses are intended only as aids to the reader in identifying the subject matter covered. They may not be relied upon as authoritative interpretations. ADMINISTRATIVE REG-100718-21, page 653. This guidance contains proposed amendments to the regulations relating to the user fees for the special enrollment examinations for enrolled agents and enrolled retirement plan agents, the EA SEE and ERPA SEE, respectively. In accordance with the guidelines in OMB Circular A-25, the IRS has re-calculated its cost of overseeing the EA SEE and determined that the full cost has increased to $99 per part, plus an amount payable directly to a third-party contractor. The IRS no longer offers new enrollment as an ERPA or the ERPA SEE. Therefore, the proposed regulations increase the amount of the user fee for the EA SEE from $81 to $99 per part and remove the user fee for the ERPA SEE. Rev. Proc. 2021-44, page 469. This procedure publishes the amounts of unused housing credit carryovers allocated to qualified states under section 42(h)(3)(D) of the Code for calendar year 2021. EXCISE TAX REG-107707-21, page 657. This document sets forth proposed regulations regarding certain requirements regarding implementation of the protections against balance billing provided under the No Surprises Act. The text of the temporary regulations issued jointly with the Department of Health and Human Services, the Department of Labor, and the Office of Personnel Management serves as the text of these proposed regulations. T.D. 9955, page 471. This document, issued jointly with the Department of Health and Human Services, the Department of Labor, and the Office Finding Lists begin on page ii. of Personnel Management, provides for a federal independent dispute resolution process to permit group health plans and nonparticipating providers, facilities, and providers of air ambulance services to determine the out-of-network rate for items and services that are emergency services, nonemergency services furnished by nonparticipating providers at participating facilities, and air ambulance services furnished by nonparticipating providers of air ambulance services, under certain circumstances. Additionally, the temporary regulations expand the scope of claims eligible for external review to include adverse benefit determinations related to compliance with the surprise billing and cost-sharing protections under the No Surprises Act. INCOME TAX Rev. Proc. 2021-32, page 465. This revenue procedure updates and supersedes Rev. Proc. 2020-15. One country, Chile, is added to the list of countries with which the United States has in force an information exchange agreement, such that bank deposit interest paid to residents of such countries must be reported by payors to the extent required under Treas. Reg. §§1.6049-8(a) and 1.6049-4(b)(5). Two countries, the Dominican Republic and Singapore, are added to the list of countries with which Treasury and the IRS have determined it is appropriate to have an automatic exchange relationship with respect to such bank deposit interest. Rev. Rul. 2021-19, page 470. Fringe benefits aircraft valuation formula. For purposes of section 1.61-21(g) of the Income Tax Regulations, relating to the rule for valuing non-commercial flights on employer-provided aircraft, the Standard Industry Fare Level (SIFL) centsper-mile rates and terminal charges in effect for the second half of 2021 are set forth. The IRS Mission Provide America’s taxpayers top-quality service by helping them understand and meet their tax responsibilities and enforce the law with integrity and fairness to all. Introduction The Internal Revenue Bulletin is the authoritative instrument of the Commissioner of Internal Revenue for announcing official rulings and procedures of the Internal Revenue Service and for publishing Treasury Decisions, Executive Orders, Tax Conventions, legislation, court decisions, and other items of general interest. It is published weekly. It is the policy of the Service to publish in the Bulletin all substantive rulings necessary to promote a uniform application of the tax laws, including all rulings that supersede, revoke, modify, or amend any of those previously published in the Bulletin. All published rulings apply retroactively unless otherwise indicated. Procedures relating solely to matters of internal management are not published; however, statements of internal practices and procedures that affect the rights and duties of taxpayers are published. Revenue rulings represent the conclusions of the Service on the application of the law to the pivotal facts stated in the revenue ruling. In those based on positions taken in rulings to taxpayers or technical advice to Service field offices, identifying details and information of a confidential nature are deleted to prevent unwarranted invasions of privacy and to comply with statutory requirements. Rulings and procedures reported in the Bulletin do not have the force and effect of Treasury Department Regulations, but they may be used as precedents. Unpublished rulings will not be relied on, used, or cited as precedents by Service personnel in the disposition of other cases. In applying published rulings and procedures, the effect of subsequent legislation, regulations, court decisions, rulings, and procedures must be considered, and Service personnel and others concerned are cautioned against reaching the same conclusions in other cases unless the facts and circumstances are substantially the same. The Bulletin is divided into four parts as follows: Part I.—1986 Code. This part includes rulings and decisions based on provisions of the Internal Revenue Code of 1986. Part II.—Treaties and Tax Legislation. This part is divided into two subparts as follows: Subpart A, Tax Conventions and Other Related Items, and Subpart B, Legislation and Related Committee Reports. Part III.—Administrative, Procedural, and Miscellaneous. To the extent practicable, pertinent cross references to these subjects are contained in the other Parts and Subparts. Also included in this part are Bank Secrecy Act Administrative Rulings. Bank Secrecy Act Administrative Rulings are issued by the Department of the Treasury’s Office of the Assistant Secretary (Enforcement). Part IV.—Items of General Interest. This part includes notices of proposed rulemakings, disbarment and suspension lists, and announcements. The last Bulletin for each month includes a cumulative index for the matters published during the preceding months. These monthly indexes are cumulated on a semiannual basis, and are published in the last Bulletin of each semiannual period. The contents of this publication are not copyrighted and may be reprinted freely. A citation of the Internal Revenue Bulletin as the source would be appropriate. October 18, 2021  Bulletin No. 2021–42 Part I 26 CFR 601.601: Rules and regulations (Also Part 1, §§ 6049; 1.6049-4, 1.6049-8) that it is appropriate to have an automatic exchange relationship. Implementation of Nonresident Alien Deposit Interest Regulations Rev. Proc. 2021-32 SECTION 1. PURPOSE This revenue procedure provides a list of the jurisdictions with which the United States has in effect a relevant information exchange agreement such that the reporting requirement of §§ 1.6049-4(b)(5) and 1.6049-8(a) of the Income Tax Regulations may apply with respect to certain deposit interest paid to residents of such jurisdictions. This revenue procedure also provides a list of the jurisdictions with which the Department of the Treasury (Treasury Department) and the Internal Revenue Service (IRS) have determined that it is appropriate to have an automatic exchange relationship with respect to the information collected under §§ 1.6049-4(b)(5) and 1.6049-8(a). These lists are updated and restated versions of those set forth in Rev. Proc. 2020-15, 2020-23 I.R.B. 905. Chile has been added in Section 3 of this revenue procedure to the list of jurisdictions with which the United States has in effect a relevant information exchange agreement. The Dominican Republic and Singapore have been added in Section 4 of this revenue procedure to the list of jurisdictions with which the Treasury Department and the IRS have determined SECTION 2. BACKGROUND Sections 1.6049-4(b)(5) and 1.60498(a), as revised by TD 9584, 2012-20 I.R.B. 900, require the reporting of certain deposit interest paid to nonresident alien individuals on or after January 1, 2013. Section 1.6049-4(b)(5) provides that in the case of interest aggregating $10 or more paid to a nonresident alien individual (as defined in section 7701(b)(1)(B)) that is reportable under § 1.6049-8(a), the payor is required to make an information return on Form 1042-S, Foreign Person’s U.S. Source Income Subject to Withholding, for the calendar year in which the interest is paid. Interest that is reportable under § 1.6049-8(a) is interest described in section 871(i)(2)(A) that relates to a deposit maintained at an office within the United States. The regulations also provide that such deposit interest is reportable only if paid to a resident of a jurisdiction that is identified as a jurisdiction with which the United States has in effect an income tax or other convention or bilateral agreement relating to the exchange of tax information within the meaning of section 6103(k)(4), under which the competent authority is the Secretary of the Treasury or the Secretary’s delegate and the United States agrees to provide, as well as receive, information. Finally, the regulations provide that jurisdictions are so identified in an applicable revenue procedure (see § 601.601(d)(2)) as of December 31 before the calendar year in which the interest is paid. The preamble to the regulations (at 2012-20 I.R.B. 901-02) notes Jurisdiction SECTION 3. JURISDICTIONS OF RESIDENCE WITH RESPECT TO WHICH THE DEPOSIT INTEREST REPORTING REQUIREMENT APPLIES The following are the jurisdictions with which the United States has in effect an income tax or other convention or bilateral agreement relating to the exchange of tax information within the meaning of section 6103(k)(4) pursuant to which the United States agrees to provide, as well as receive, information and under which the competent authority is the Secretary of the Treasury or the Secretary’s delegate: Rev. Proc. First Identifying Jurisdiction 2012-24 2018-36 2012-24 2012-24 2012-24 2012-24 2012-24 Antigua & Barbuda Argentina Aruba Australia Austria Azerbaijan Bangladesh Bulletin No. 2021–42 that the IRS will not exchange information with another jurisdiction, even if an information exchange agreement is in effect, if there are concerns about confidentiality, safeguarding of data exchanged, the use of the information, or other factors that would make the exchange of information inappropriate. Rev. Proc. 2012-24, 2012-20 I.R.B. 913, was published contemporaneously with the publication of TD 9584 to provide a list of those jurisdictions with which the United States has in effect an information exchange agreement, such that interest paid to residents of such jurisdictions must be reported by payors to the extent required under §§ 1.6049-4(b)(5) and 1.6049-8(a), and to provide a separate list identifying those jurisdictions with which the automatic exchange of the information collected under the regulations has been determined by the Treasury Department and the IRS to be appropriate. Before issuance of this Rev. Proc. 2021-32, the most current versions of those lists were set forth in Rev. Proc. 2020-15. 465 October 18, 2021 Jurisdiction Rev. Proc. First Identifying Jurisdiction 2012-24 2012-24 2012-24 2014-64 2012-24 2012-24 2012-24 2014-64 2021-32 2012-24 2014-64 2012-24 2014-64 2014-64 2012-24 2012-24 2012-24 2012-24 2012-24 2012-24 2012-24 2017-46 2012-24 2012-24 2019-23 2012-24 2012-24 2012-24 2017-46 2012-24 2012-24 2012-24 2012-24 2014-64 2012-24 2012-24 2012-24 2012-24 2012-24 2012-24 2012-24 2012-24 2012-24 2012-24 Barbados Belgium Bermuda Brazil British Virgin Islands Bulgaria Canada Cayman Islands Chile China Colombia Costa Rica Croatia Curaçao Cyprus Czech Republic Denmark Dominica Dominican Republic Egypt Estonia Faroe Islands Finland France Georgia Germany Gibraltar Greece Greenland Grenada Guernsey Guyana Honduras Hong Kong Hungary Iceland India Indonesia Ireland Isle of Man Israel Italy Jamaica Japan October 18, 2021 466 Bulletin No. 2021–42 Jurisdiction Jersey Kazakhstan Korea, Republic of Latvia Liechtenstein Lithuania Luxembourg Malta Marshall Islands Mauritius Mexico Moldova Monaco Morocco Netherlands Netherlands special municipalities: Bonaire, Sint Eustatius, and Saba New Zealand Norway Pakistan Panama Peru Philippines Poland Portugal Romania Russian Federation Saint Lucia Singapore Sint Maarten Slovak Republic Slovenia South Africa Spain Sri Lanka Sweden Switzerland Thailand Trinidad and Tobago Tunisia Turkey Ukraine United Kingdom Venezuela Bulletin No. 2021–42 467 Rev. Proc. First Identifying Jurisdiction 2012-24 2012-24 2012-24 2012-24 2012-24 2012-24 2012-24 2012-24 2012-24 2014-64 2012-64 2018-36 2012-24 2012-24 2012-24 2012-24 2012-24 2012-24 2012-24 2012-24 2012-24 2012-24 2012-24 2012-24 2012-24 2012-24 2016-56 2020-15 2014-64 2012-24 2012-24 2012-24 2012-24 2012-24 2012-24 2012-24 2012-24 2012-24 2012-24 2012-24 2012-24 2012-24 2012-24 October 18, 2021 SECTION 4. JURISDICTIONS WITH WHICH THE TREASURY DEPARTMENT AND THE IRS HAVE DETERMINED THAT AUTOMATIC EXCHANGE OF DEPOSIT INTEREST INFORMATION IS APPROPRIATE The following list identifies the jurisdictions with which the automatic exchange of the information collected under §§ 1.6049-4(b) (5) and 1.6049-8 has been determined by the Treasury Department and the IRS to be appropriate: Jurisdiction Rev. Proc. First Memorializing Determination on Automatic Exchange with Jurisdiction 2014-64 2016-18 2017-31 2015-50 2012-24 2017-31 2017-46 2019-23 2019-23 2015-50 2014-64 2021-32 2015-50 2014-64 2014-64 2014-64 2015-50 2018-36 2014-64 2015-50 2015-50 2015-50 2014-64 2014-64 2016-56 2014-64 2016-18 2014-64 2016-56 2015-50 2015-50 2015-50 2015-50 2014-64 2014-64 2014-64 2014-64 2015-50 2014-64 2017-46 Australia Azerbaijan Belgium Brazil Canada Colombia Croatia Curaçao Cyprus Czech Republic Denmark Dominican Republic Estonia Finland France Germany Gibraltar Greece Guernsey Hungary Iceland India Ireland Isle of Man Israel Italy Jamaica Jersey Korea, Republic of Latvia Liechtenstein Lithuania Luxembourg Malta Mauritius Mexico Netherlands New Zealand Norway Panama October 18, 2021 468 Bulletin No. 2021–42 Jurisdiction Rev. Proc. First Memorializing Determination on Automatic Exchange with Jurisdiction 2015-50 2017-31 2016-56 2021-32 2016-18 2015-50 2015-50 2014-64 2015-50 2014-64 Poland Portugal Saint Lucia Singapore Slovak Republic Slovenia South Africa Spain Sweden United Kingdom SECTION 5. EFFECT ON OTHER DOCUMENTS Rev. Proc. 2020-15 is superseded. SECTION 6. EFFECTIVE DATES For purposes of the reporting requirement of § 1.6049-4(b)(5), the list of jurisdictions in Section 3 of this revenue procedure is effective: (i) with respect to Chile, for interest paid on or after January 1, 2022; and (ii) with respect to each other listed jurisdiction, for interest paid on or after January 1 of the calendar year following the issuance of the revenue procedure (as cited in Section 3) first identifying the jurisdiction as having in effect an agreement with the United States as described in § 1.6049-8(a). The list of jurisdictions in Section 4 of this revenue procedure is effective from the date of issuance of this revenue procedure with respect to information reported to the IRS pursuant to §§ 1.6049-4(b)(5) and 1.6049-8(a) for any tax year for which the jurisdiction was included in the list in Section 3. The revenue procedure citations in the Section 4 list are included for historical reference. SECTION 7. DRAFTING INFORMATION The principal authors of this revenue procedure are Jackie B. Manasterli and Michelle R. Phillips of the Office of Associate Chief Counsel (International). For further information regarding this revenue Bulletin No. 2021–42 procedure, contact Ms. Manasterli or Ms. Phillips at (202) 317-6941 (not a toll-free number). Rev. Proc. 2021-44 SECTION 1. PURPOSE This revenue procedure publishes the amounts of unused housing credit carryovers allocated to qualified states under § 42(h)(3)(D) of the Internal Revenue Code for calendar year 2021. SECTION 2. BACKGROUND Rev. Proc. 2019-45, 2019-48 I.R.B. 524, provides guidance to state housing credit agencies of qualified states on the procedure for requesting an allocation of unused housing credit carryovers under § 42(h)(3)(D). The amount of unused housing credit carryovers allocated to qualified states for a calendar year from a national pool of unused credit authority (the National Pool) is published by the Internal Revenue Service in the Internal Revenue Bulletin. This revenue procedure publishes these amounts for calendar year 2021. SECTION 3. PROCEDURE The unused housing credit carryover amount allocated from the National Pool by the Secretary to each qualified state for calendar year 2021 is as follows: 469 Qualified State Alabama Arkansas California Connecticut Delaware Florida Georgia Idaho Indiana Kentucky Maryland Massachusetts Michigan Minnesota Nebraska New Jersey New Mexico New York Oklahoma Pennsylvania Rhode Island South Dakota Texas Utah Vermont Virginia Washington West Virginia Wisconsin Amount Allocated 169,738 104,519 1,357,757 122,677 34,034 749,555 369,375 63,008 232,970 154,415 208,857 237,751 343,734 195,115 66,824 306,342 72,644 666,902 137,292 440,879 36,459 30,789 1,012,617 112,084 21,498 296,278 265,343 61,555 201,161 October 18, 2021 EFFECTIVE DATE DRAFTING INFORMATION This revenue procedure is effective for allocations of housing credit dollar amounts attributable to the National Pool component of a qualified state’s housing credit ceiling for calendar year 2021. The principal author of this revenue procedure is YoungNa Lee of the Office of Associate Chief Counsel (Passthroughs and Special Industries). For further information regarding this revenue procedure, contact Ms. Lee at (202) 317-4137 (not a toll-free number). Rev. Rul. 2021-19 the Department of Transportation (DOT) and are reviewed semi-annually. According to DOT, due to the effect of the COVID-19 pandemic, airline industry capacity (as measured by airline seat miles) was reduced faster than airline industry expenses were reduced. Generally, the SIFL rate is the result of airline industry expenses divided by airline seat miles. Because airline seat miles were reduced faster than airline industry expenses, the SIFL rate for the 6-month Tax Period Effective 1/1/2021 increased substantially. Furthermore, in March 2020, the Coronavirus Aid, Relief, and Economic Security Act was enacted, directing the Treasury Department to allot up to $25 billion for domestic carriers to cover payroll expenses via grants and promissory notes, known as the Payroll Support Program (PSP). The PSP grants and PSP promis- For purposes of the taxation of fringe benefits under section 61 of the Internal Revenue Code, section 1.61-21(g) of the Income Tax Regulations provides a rule for valuing noncommercial flights on employer-provided aircraft. Section 1.6121(g)(5) provides an aircraft valuation formula to determine the value of such flights. The value of a flight is determined under the base aircraft valuation formula (also known as the Standard Industry Fare Level formula or SIFL) by multiplying the SIFL cents-per-mile rates applicable for the period during which the flight was taken by the appropriate aircraft multiple provided in section 1.61-21(g)(7) and then adding the applicable terminal charge. The SIFL cents-per-mile rates in the formula and the terminal charge are calculated by Section 42 — Low-Income Housing Credit. 26 CFR 1.42-14. Allocation rules for post-1989 State housing credit ceiling amounts. Guidance is provided to state housing credit agencies of qualified states that request an allocation of unused housing credit carryover under section 42(h)(3)(D) of the Internal Revenue Code. See Rev. Proc. 2021-44 sory notes offset airline industry expenses. Accordingly, DOT provided two alternatives to incorporate differing levels of the PSP into the SIFL rate calculations to both account for the PSP in the rate calculations and to mitigate the pandemic impact on the SIFL rate. One calculation adjusts the SIFL rates to account for PSP grants only while the other calculation adjusts the SIFL rates to account for both the PSP grants and PSP promissory notes. This revenue ruling contains these three SIFL rates: (1) the Unadjusted SIFL Rate, (2) the SIFL Rate Adjusted for PSP Grants, and (3) the SIFL Rate Adjusted for PSP Grants and Promissory Notes. Taxpayers may use any of the three rates when determining the value on noncommercial flights of employer-provided aircraft under section 1.61-21(g). The following charts set forth the terminal charges and SIFL mileage rates: Unadjusted SIFL Rate Period During Which the Flight Is Taken Terminal Charge SIFL Mileage Rates 7/1/21 - 12/31/21 $81.43 Up to 500 miles = $.4455 per mile 501-1500 miles = $.3396 per mile Over 1500 miles = $.3265 per mile SIFL Rate Adjusted for PSP Grants 7/1/21 - 12/31/21 $43.54 Up to 500 miles = $.2382 per mile 501-1500 miles = $.1816 per mile Over 1500 miles = $.1746 per mile October 18, 2021 470 Bulletin No. 2021–42 SIFL Rate Adjusted for PSP Grants and Promissory Notes 7/1/21 - 12/31/21 $30.69 Up to 500 miles = $.1679 per mile 501-1500 miles = $.1280 per mile Over 1500 miles = $.1231 per mile DRAFTING INFORMATION ers, facilities, and providers of air ambulance services. DATES: Effective date: These regulations are effective on [INSERT THE DATE OF PUBLICATION IN THE FEDERAL REGISTER]. Applicability date: Except as otherwise specified in this paragraph, the regulations issued jointly by the Departments of HHS, Labor, and the Treasury are generally applicable for plan or policy years beginning on or after January 1, 2022. The regulations regarding certification of IDR entities at 26 CFR 54.9816-8T(a) and (e), 29 CFR 2590.716-8(a) and (e), and 45 CFR 149.510(a) and (e) are applicable beginning on [INSERT THE DATE OF PUBLICATION IN THE FEDERAL REGISTER]. The OPM-only regulations that apply to health benefits plans are applicable to contract years beginning on or after January 1, 2022. The regulations issued by HHS alone that apply to health care providers, facilities, providers of air ambulance services, and SDR entities are applicable beginning on January 1, 2022, except that the regulations at 45 CFR 149.620(a) and (d) are applicable beginning on [INSERT THE DATE OF PUBLICATION IN THE FEDERAL REGISTER]. Comment date: To be assured consideration, comments must be received at one of the addresses provided below, no later than 5 p.m. on [INSERT DATE 60 DAYS AFTER DATE OF PUBLICATION IN FEDERAL REGISTER]. The principal author of this revenue ruling is Kathleen Edmondson of the Office of Associate Chief Counsel (Employee Benefits, Exempt Organizations and Employment Taxes). For further information regarding this revenue ruling, contact Ms. Edmondson at (202) 317-6798 (not a toll-free number). 26 CFR 54.9816-8T: Independent dispute resolution process (temp); 26 CFR 54.9817-2T: Independent dispute resolution process for air ambulance services (temp) T.D. 9955 DEPARTMENT OF THE TREASURY Internal Revenue Service 26 CFR Part 54 Requirements Related to Surprise Billing; Part II AGENCY: Office of Personnel Management; Internal Revenue Service, Department of the Treasury; Employee Benefits Security Administration, Department of Labor; Centers for Medicare & Medicaid Services, Department of Health and Human Services. ACTION: Interim final rules with request for comments. SUMMARY: This document sets forth interim final rules implementing certain provisions of the No Surprises Act, which was enacted as part of the Consolidated Appropriations Act, 2021. These interim final rules implement pro- Bulletin No. 2021–42 visions of the No Surprises Act that provide for a Federal independent dispute resolution (IDR) (Federal IDR) process to permit group health plans and health insurance issuers offering group or individual health insurance coverage and nonparticipating providers, facilities, and providers of air ambulance services to determine the out-of-network rate for items and services that are emergency services, nonemergency services furnished by nonparticipating providers at participating facilities, and air ambulance services furnished by nonparticipating providers of air ambulance services, under certain circumstances. The Department of Health and Human Services (HHS), the Department of Labor (DOL), and the Department of the Treasury (collectively, the Departments) are issuing these interim final rules with largely parallel provisions that apply to group health plans and health insurance issuers offering group or individual health insurance coverage and certified IDR entities, providers, facilities, and providers of air ambulance services. In addition to the interim final rules issued jointly by the Departments, this document also includes interim final rules issued by the Office of Personnel Management (OPM) to clarify how certain No Surprises Act provisions apply to health benefits plans offered by carriers under the Federal Employees Health Benefits (FEHB) Act. In addition to the interim final rules issued jointly by the Departments and OPM, this document includes interim final rules issued by HHS that address good faith estimates of health care items and services for uninsured or self-pay individuals and the associated patient-provider dispute resolution process. The HHS-only interim final rules apply to selected dispute resolution (SDR) entities, provid- 471 ADDRESSES: Written comments may be submitted to the addresses specified below. Any comment that is submitted will be shared among the Departments. Please do not submit duplicates. Comments will be made available to the public. Warning: Do not include any personally identifiable information (such as name, address, or other contact infor- October 18, 2021 mation) or confidential business information that you do not want publicly disclosed. Comments are posted on the internet exactly as received and can be retrieved by most internet search engines. No deletions, modifications, or redactions will be made to the comments received, as they are public records. Comments may be submitted anonymously. In commenting, refer to file code RIN 1210-AB00. Because of staff and resource limitations, we cannot accept comments by facsimile (FAX) transmission. Comments, including mass comment submissions, must be submitted in one of the following two ways (please choose only one of the ways listed): 1. Electronically. You may submit electronic comments on this regulation to https://www.regulations.gov. Follow the “Submit a comment” instructions. 2. By mail. You may mail written comments to the following address ONLY: Office of Health Plan Standards and Compliance Assistance, Employee Benefits Security Administration, U.S. Department of Labor, 200 Constitution Avenue NW, Room N-5653, Washington, DC 20210, Attention: RIN 1210-AB00. You may mail written comments  regarding the HHS-only regulations to the following address: Centers for Medicare & Medicaid Services, Department of Health and Human Services, Attention CMS-9908-IFC, P.O. Box 8010, Baltimore, MD 21244-8010. Attention: RIN 0938-AU62. Please allow sufficient time for mailed comments to be received before the close of the comment period. For information on viewing public comments, see the beginning of the SUPPLEMENTARY INFORMATION section. FOR FURTHER INFORMATION CONTACT: Padma Babubhai Shah, Office of Personnel Management, at 202606-4056; Kari DiCecco, Internal Revenue Service, Department of the Treasury, at 202-317-5500; Elizabeth Schumacher or David Sydlik, Employee Benefits Secu- rity Administration, Department of Labor, at 202-693-8335; Deborah Bryant, Centers for Medicare & Medicaid Services, Department of Health and Human Services, at 301-492-4293. Customer Service Information: Information from OPM on health benefits plans offered under the FEHB Program can be found on the OPM website (www.opm. gov/healthcare-insurance/healthcare/). Individuals interested in obtaining information from the DOL concerning employment-based health coverage laws may call the Employee Benefits Security Administration (EBSA) Toll-Free Hotline at 1-866444-EBSA (3272) or visit the DOL’s website (www.dol.gov/agencies/ebsa). In addition, information from HHS on private health insurance coverage, coverage provided by non-Federal governmental group health plans, and requirements that apply to health care providers, health care facilities, and providers of air ambulance services can be found on the Centers for Medicare & Medicaid Services (CMS) website (www.cms.gov/cciio), and information on health care reform can be found at www.HealthCare.gov. SUPPLEMENTARY INFORMATION: Inspection of Public Comments: Comments received before the close of the comment period are available for viewing by the public, including any personally identifiable or confidential business information that is included in a comment. We post comments received before the close of the comment period on the following website as soon as possible after they have been received: https://regulations. gov. Follow the search instructions on that website to view public comments. I. Background A. Preventing Surprise Medical Bills under the Consolidated Appropriations Act, 2021 On December 27, 2020, the Consolidated Appropriations Act, 2021 (CAA), which includes the No Surprises Act, was enacted.1 The No Surprises Act provides Federal protections against surprise billing and limits out-of-network cost sharing under many of the circumstances in which surprise bills arise most frequently. Surprise billing occurs when an individual receives an unexpected medical bill from a health care provider or facility after receiving medical services from a provider or facility that, usually unknown to the participant, beneficiary, or enrollee, is a nonparticipating provider or facility with respect to the individual’s coverage. The No Surprises Act added new provisions applicable to group health plans and health insurance issuers offering group or individual health insurance coverage in Subchapter B of chapter 100 of the Internal Revenue Code (Code), Part 7 of the Employee Retirement Income Security Act (ERISA), and Part D of title XXVII of the Public Health Service Act (PHS Act). Section 102 of the No Surprises Act added Code section 9816, ERISA section 716, and PHS Act section 2799A-1,2 which contain limitations on cost sharing and requirements regarding the timing of initial payments for emergency services furnished by nonparticipating providers and emergency facilities, and for nonemergency services furnished by nonparticipating providers at certain participating health care facilities. Section 103 of the No Surprises Act amended Code section 9816, ERISA section 716, and PHS Act section 2799A-1 to establish a Federal IDR process that allows plans and issuers and nonparticipating providers and facilities to resolve disputes regarding outof-network rates. Section 105 of the No Surprises Act created Code section 9817, ERISA section 717, and PHS Act section 2799A-2, which contain limitations on cost sharing and requirements for the timing of initial payments for nonparticipating providers of air ambulance services and allow plans and issuers and providers of air ambulance services to access the Federal IDR process described in Code section 9816, ERISA section 716, and PHS Act section 2799A-1. The No Sur- Pub. L. 116-260 (December 27, 2020). As discussed later in this preamble, section 102(d)(1) of the No Surprises Act amended the Federal Employees Health Benefits Act, 5 U.S.C. 8901 et seq., by adding a new subsection (p) to 5 U.S.C. 8902. Under this new provision, each FEHB Program contract must require a carrier to comply with requirements described in section 9816 of the Code, section 716 of ERISA, and section 2799A-1 (as applicable) in the same manner as these provisions apply with respect to a group health plan or health insurance issuer offering group or individual health insurance coverage. 1 2 October 18, 2021 472 Bulletin No. 2021–42 prises Act provisions that apply to health care providers and facilities and providers of air ambulance services, such as prohibitions on balance billing for certain items and services and requirements related to disclosures about balance billing protections, were added to title XXVII of the PHS Act in a new part E. On July 13, 2021, the Departments of the Treasury, Labor, and Health and Human Services (Departments) and the Office of Personnel Management (OPM) published interim final rules with request for comments titled, Requirements Related to Surprise Billing; Part I, which generally apply to group health plans and health insurance issuers offering group or individual health insurance coverage (including grandfathered health plans) with respect to plan years (in the individual market, policy years) beginning on or after January 1, 2022; to carriers in the FEHB Program with respect to contract years beginning on or after January 1, 2022; and to health care providers and facilities, and providers of air ambulance services beginning on January 1, 2022 (July 2021 interim final rules).3 The July 2021 interim final rules implement Code sections 9816(a)-(b) and 9817(a), ERISA sections 716(a)-(b) and 717(a), and PHS Act sections 2799A-1(a)-(b), 2799A-2(a), 2799A-7, 2799B-1, 2799B-2, 2799B-3, and 2799B-5 to protect consumers from surprise medical bills for emergency services, nonemergency services furnished by nonparticipating providers at participating facilities in certain circumstances, and air ambulance services furnished by nonparticipating providers of air ambulance services. Among other requirements, the July 2021 interim final rules require plans and issuers that provide or cover any benefits with respect to services in an emergency department of a hospital or with respect to emergency services in an independent freestanding emergency department to cover emergency services without any prior authorization; without regard to whether the health care provider furnishing the emergency services is a participating provider or the services are provided in a participating emergency facility; and without regard to any other term or condition of the plan or coverage other than the exclusion or coordination of benefits or a permitted affiliation or waiting period. With respect to emergency services furnished by nonparticipating providers or facilities, nonemergency services furnished by nonparticipating providers at certain participating facilities, and air ambulance services furnished by nonparticipating providers of air ambulance services, the July 2021 interim final rules generally limit cost sharing for outof-network services to in-network levels, require such cost sharing to count toward any in-network deductibles and out-ofpocket maximums, and prohibit balance billing. The July 2021 interim final rules also specify that consumer cost-sharing amounts for emergency services furnished by nonparticipating providers or facilities, and for nonemergency services furnished by nonparticipating providers at certain participating facilities, must be calculated based on one of the following amounts: (1) an amount determined by an applicable All-Payer Model Agreement under Social Security Act section 1115A; (2) if there is no such applicable All-Payer Model Agreement, an amount determined by a specified state law; or (3) if there is no such applicable All-Payer Model Agreement or specified state law, the lesser of the billed charge or the plan’s or issuer’s median contracted rate, the latter referred to as the qualifying payment amount (QPA). Cost-sharing amounts for air ambulance services provided by nonparticipating providers of air ambulance services must meet the same standards as would apply if the services were provided by a participating provider of air ambulance services and must be calculated using the lesser of the billed charges or the QPA. Under the July 2021 interim final rules, balance billing for services subject to the requirements in those interim final rules generally is prohibited.4 In general, the protections in the July 2021 interim final rules that limit cost sharing and prohibit balance billing do not apply to certain post-stabilization services, or to certain nonemergency services performed by nonparticipating providers at participating health care facilities, if the provider makes certain disclosures to the participant, beneficiary, or enrollee, and obtains the individual’s consent to waive balance billing protections. However, this exception to the prohibition on balance billing is narrow. In particular, it is not available in certain circumstances where surprise bills are likely to occur, such as for ancillary services provided by nonparticipating providers in connection with nonemergency care in a participating health care facility. The July 2021 interim final rules also include a number of other specific requirements regarding notice and consent that must be met in order for a provider or facility to be permitted to balance bill a participant, beneficiary, or enrollee for items and services that would otherwise be subject to the prohibition on balance billing. The Departments are issuing regulations in several phases implementing provisions of title I (No Surprises Act) and title II (Transparency) of Division BB of the CAA. These interim final rules build upon the protections in the July 2021 interim final rules and implement the Federal IDR provisions under Code sections 9816(c) and 9817(b), ERISA sections 716(c) and 717(b), and PHS Act sections 2799A-1(c) and 2799A-2(b). OPM is also issuing regulations in phases to implement 5 U.S.C. section 8902(p). The Departments and OPM also published a notice of proposed rulemaking on September 16, 2021, titled Requirements Related to Air Ambulance Services, Agent and Broker Disclosures, and Provider Enforcement.5 The proposed rule would, if finalized, implement reporting requirements for air ambulance claims data; requirements on health insurance issuers offering individual health insurance coverage or short term, limited-duration insurance to disclose and report information regarding direct or indirect compensation provided to agents and brokers (section 202(c) of title II of Division BB of the CAA); as well as provisions 86 FR 36872 (July 13, 2021). 45 CFR 149.410(a), 149.420(a) and 149.440(a). 5 86 FR 51730 (Sept. 16, 2021). 3 4 Bulletin No. 2021–42 473 October 18, 2021 related to HHS enforcement of requirements on issuers, non-Federal governmental group health plans, providers, facilities, and providers of air ambulance services. Later this year, the Departments intend to undertake rulemaking to implement reporting requirements related to pharmacy benefits and prescription drug costs (section 204 of title II of Division BB of the CAA). The provisions of the No Surprises Act that are applicable to group health plans and health insurance issuers offering group or individual health insurance coverage in the Code, ERISA, and the PHS Act apply to grandfathered health plans. Section 1251 of the Affordable Care Act provides that grandfathered health plans are not subject to certain provisions of the Code, ERISA, and the PHS Act, as added by the Affordable Care Act, for as long as they maintain their status as grandfathered health plans.6 For example, grandfathered health plans are neither subject to the requirement to cover certain preventive services without cost sharing under PHS Act section 2713 nor to the annual limitation on cost sharing set forth under PHS Act section 2707(b). If a plan or coverage were to relinquish its grandfathered status, it would be required to comply with both provisions, in addition to several other requirements. However, the CAA does not include an exception for grandfathered health plans that is comparable to section 1251 of the Affordable Care Act. Furthermore, section 102(d)(2) of the No Surprises Act amended section 1251(a) of the Affordable Care Act to clarify that the new and recodified patient protections provisions of the No Surprises Act, including those related to choice of health care professional, apply to grandfathered health plans. Therefore, not only do the provisions of these interim final rules and the provisions of the July 2021 interim final rules that apply to group health plans and issuers of group or individual health insurance coverage apply to grandfathered plans, so do the other provisions applicable to group health plans and issuers of group or individual health insurance coverage in titles I and II of Division BB of the CAA. B. PHS Act Section 2719 and Scope of Claims Eligible for External Review PHS Act section 2719, as added by the Affordable Care Act, applies to group health plans that are not grandfathered health plans and health insurance issuers offering non-grandfathered coverage in the group and individual markets, and sets forth standards for plans and issuers regarding both internal claims and appeals and external review. With respect to external review, PHS Act section 2719 provides for both state external review processes and a Federal external review process that applies in the absence of an applicable state process that meets the requirements of section 2719. Non-grandfathered group health plans that are not self-insured plans (as self-insured plans are not subject to state insurance regulations) and health insurance issuers offering non-grandfathered group or individual health insurance coverage must comply with an applicable state external review process if that process includes, at a minimum, the consumer protections set forth in the Uniform Health Carrier External Review Model Act issued by the National Association of Insurance Commissioners (the NAIC Uniform Model Act). If a state’s external review process does not meet the minimum consumer protection standards set forth in the NAIC Uniform Model Act (or if a plan is self-insured and not subject to state insurance regulation), group health plans and health insurance issuers in the group and individual markets in that state are required to implement an effective external review process that meets minimum standards established by the Departments through rulemaking. The Departments issued interim final regulations to implement PHS Act section 2719, including the provisions related to external review, in 2010.7 An amendment to the interim final rules was issued in 2011.8 In 2015, the Departments issued final rules to finalize the interim final regulations.9 Among other things, the 2015 final rules address the scope of claims eligible for external review.10 State external review processes that meet the minimum standards must provide for the external review of adverse benefit determinations that are based on requirements for medical necessity, appropriateness, health care setting, level of care, or effectiveness of a covered benefit. The Federal external review process must be available for any adverse benefit determination by a plan or issuer that involves medical judgment, as well as rescissions. Section 110 of the No Surprises Act directs the Departments, in applying section 2719(b) of the PHS Act, to require the external review process to apply with respect to any adverse determination by a plan or issuer under Code section 9816 or 9817, ERISA section 716 or 717, or PHS Act section 2799A-1 or 2799A-2. C. Protecting Uninsured Individuals Through Transparency and PatientProvider Dispute Resolution On July 9, 2021, President Biden signed Executive Order 14036, Promoting Competition in the American Economy in order to promote the interests of American workers, businesses, and consumers.11 The executive order acknowledges that robust competition is critical to providing consumers with more choices, better service, and lower prices and directs the Secretary of HHS to support existing price transparency initiatives for hospitals, other providers, and insurers along with any new price transparency initiatives or changes made necessary by the No Surprises Act or any other statues. For a list of the market reform provisions applicable to grandfathered health plans under title XXVII of the PHS Act that the Affordable Care Act added or amended and that were incorporated into ERISA and the Code, visit https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/laws/affordable-care-act/for-employers-and-advisers/grandfathered-health-plans-provisions-summary-chart.pdf. 7 75 FR 43329 (July 23, 2010). 8 76 FR 37207 (June 10, 2011). 9 80 FR 72191 (Nov. 18, 2015). 10 26 CFR 54.9815-2719(d)(1); 29 CFR 2590.715-2719(d)(1); 45 CFR 147.136(d)(1). 11 86 FR 36987 (Jul 9, 2021). 6 October 18, 2021 474 Bulletin No. 2021–42 Consistent with Executive Order 14036, these interim final rules implement provisions of the No Surprises Act that will provide individuals with more pricing information prior to seeking care, allowing them to shop for the care that is best for them and increase competition in the health care market. The No Surprises Act also adds a new Part E of title XXVII of the PHS Act establishing requirements applicable to health care providers, providers of air ambulance services, and health care facilities. Section 112 of the No Surprises Act adds PHS Act sections 2799B-6 and 2799B-7. PHS Act section 2799B-6 requires providers and facilities to furnish a good faith estimate of expected charges upon request or upon scheduling an item or service. Providers and facilities are required to inquire if an individual is enrolled in a group health plan, group or individual health insurance coverage, an FEHB plan,12 or a Federal health care program, and, if enrolled in a group health plan, or group or individual health insurance coverage, or a health benefits plan under chapter 89 of title 5,13 whether the individual is seeking to have a claim for such item or service submitted to such plan or coverage. In the case that the individual is enrolled in such a plan or coverage (and is seeking to have a claim for such an item or services submitted to such plan or coverage), PHS Act section 2799B-6(2)(A) requires that the provider or facility furnish the good faith estimate to the individual’s plan or issuer of such coverage to inform the advanced explanation of benefits that plans and issuers are required to provide a participant, beneficiary, enrollee, or FEHB covered individual under Code section 9816(f), ERISA section 716(f), PHS Act section 2799A-1(f), and 5 U.S.C. 8902(p). In the case that the individual requesting a good faith estimate for an item or service or seeking to schedule an item or service to be furnished who is not enrolled in a plan or coverage, or is not seeking to file a claim with such plan or coverage (selfpay), PHS Act section 2799B-6(2)(B) and these interim final rules at 45 CFR 149.610 require providers and facilities to furnish the good faith estimate to the individual. These interim final rules do not include requirements regarding PHS Act section 2799B-6(2)(A), which require providers and facilities to furnish good faith estimates to plans or issuers. Under Code section 9816(f), ERISA section 716(f), and PHS Act section 2799A-1(f) and 5 U.S.C. 8902(p), plans and issuers are required to include the good faith estimates in an advanced explanation of benefits provided to participants, beneficiaries, enrollees, and FEHB covered individuals. As stated in the August 20, 2021, FAQs issued by the Departments, the Departments have received feedback from the public about the challenges of developing the technical infrastructure necessary for providers and facilities to transmit to plans and issuers starting January 1, 2022, the good faith estimates required under PHS Act section 2799B6, which plans and issuers must then include in the advanced explanation of benefits. Accordingly, until rulemaking to fully implement this requirement to provide such a good faith estimate to an individual’s plan or coverage is adopted and applicable, HHS will defer enforcement of the requirement that providers and facilities provide good faith estimate information for individuals enrolled in a health plan or coverage and seeking to submit a claim for scheduled items or services to their plan or coverage. Additionally, stakeholders have requested that the Departments delay the applicability date of Code section 9816(f), ERISA section 716(f), and PHS Act section 2799A-1(f) until the Departments have established standards for the data transfer between providers and facilities and plans and issuers and have given enough time for plans and issuers and providers and facilities to build the infrastructure necessary to support the transfers. The Departments agree that compliance with this section is likely not possible by January 1, 2022, and therefore intend to undertake notice and comment rulemaking in the future to implement this provision, including establishing appropriate data transfer standards. Until such time, the Departments will defer enforcement of the requirement that plans and issuers must provide an advanced explanation of benefits. HHS will consider whether additional interim solutions for insured consumers are feasible. The Departments note that any rulemaking to fully implement Code section 9816(f), ERISA section 716(f), and PHS Act sections 2799A-1(f) and 2799B-6(2)(A) will include a prospective applicability date that provides plans, issuers, providers, and facilities with a reasonable amount of time to comply with new requirements. HHS encourages states that are primary enforcers of these requirements with regard to providers and issuers to take a similar enforcement approach, and will not determine that a state is failing to substantially enforce these requirements if it takes such an approach. Nonetheless, providers and facilities will be subject to enforcement action for failure to provide a good faith estimate to individuals not enrolled in a plan or coverage, or not seeking to have a claim for such item or services submitted to such plan or issuer of such coverage, as specified under these interim final rules. HHS seeks comment on this approach. On November 12, 2020, the Departments issued the Transparency in Coverage final rules,14 which require group health plans and health insurance issuers of group or individual health insurance coverage to make price comparison information available to participants, beneficiaries, and enrollees through an internet-based self-service tool and in HHS interprets the requirements described in PHS Act section 2799B-6 to apply with respect to FEHB covered individuals as they would to other individuals enrolled in a group health plan, group or individual health insurance coverage offered by a health insurance issuer. Although PHS Act section 2799B-6 does not reference health benefits plans under chapter 89 of title 5, the definition of “uninsured individual” at PHS Act section 2799B-7 does include individuals who do not have benefits under these health benefits plans, and these sections work together to provide protections for the uninsured (or self-pay) population. Moreover, the requirement for the provision of an advance explanation of benefits required by Code section 9816(f), ERISA section 716(f), and PHS Act section 2799A-(1)(f) , as well as 5 U.S.C. 8902(p) cannot be accomplished by a FEHB carrier unless it receives a good faith estimate from a provider in accordance with PHS Act section 2799B-6(2)(A). 13 A health benefits plan offered under chapter 89 of title 5, United States Code is also known as an FEHB plan. 14 26 CFR 54.9815-2715A2(b), 29 CFR 2590.715-2715A2(b), and 45 CFR 147.211(b). 12 Bulletin No. 2021–42 475 October 18, 2021 paper form, upon request. This information must be available for plan years— or in the individual market, for policy years—beginning on or after January 1, 2023 with respect to 500 specified items and services, and with respect to all covered items and services, for plan or policy years beginning on or after January 1, 2024. The Departments are of the view that the disclosure requirements to participants, beneficiaries, and enrollees under the Transparency in Coverage final rules, and those required under Code section 9816(f), ERISA section 716(f), and PHS Act section 2799A-1(f), are substantially similar and therefore the Departments seek comment on whether there are ways to leverage the Transparency in Coverage requirements, including whether there are ways for plans and issuers to provide the information required in the Transparency in Coverage final rules to participants, beneficiaries, and enrollees during plan or policy years beginning in 2022. The Departments also seek comment on whether it would be feasible for providers and facilities to provide an estimate or range of estimated costs for insured consumers upon request for 2022. Section 112 of the No Surprises Act also adds PHS Act section 2799B-7, which directs the Secretary of HHS to establish a process under which uninsured (or self-pay) individuals can avail themselves of a patient-provider dispute resolution process if their billed charges after receiving an item or service are substantially in excess of the expected charges listed in the good faith estimate furnished by the provider or facility, pursuant to PHS Act section 2799B-6. Under PHS Act section 2799B-7, an uninsured (or self-pay) individual means, with respect to an item or service, an individual who does not have benefits for such item or service under a group health plan, group or individual health insurance coverage offered by a health insurance issuer, Federal health care program (as defined in section 1128B(f) of the Social Security Act), or a health benefits plan under chapter 89 of title 5, United States Code (or an individual who has benefits for such item or service under a group health plan or individual or group health insurance coverage offered by a health insurance issuer, October 18, 2021 but does not seek to have a claim for such item or service submitted to such plan or coverage). II. Executive Summary A. Departments of the Treasury, Labor, and HHS: Federal IDR Process and External Review In order to implement the Federal IDR provisions under Code sections 9816(c) and 9817(b), ERISA sections 716(c) and 717(b), and PHS Act sections 2799A-1(c) and 2799A-2(b), as added by sections 103 and 105 of the No Surprises Act, these interim final rules establish a Federal IDR process that nonparticipating providers or facilities, nonparticipating providers of air ambulance services, and group health plans and health insurance issuers in the group and individual market may use following the end of an unsuccessful open negotiation period to determine the out-ofnetwork rate for certain services. More specifically, the Federal IDR provisions may be used to determine the out-ofnetwork rate for certain emergency services, nonemergency items and services furnished by nonparticipating providers at participating health care facilities, and air ambulance services furnished by nonparticipating providers of air ambulance services where an All-Payer Model Agreement or specified state law does not apply. Under Code sections 9816(c)(1)(A) and 9817(b)(1)(A), ERISA sections 716(c) (1)(A) and 717(b)(1)(A), PHS Act sections 2799A-1(c)(1)(A) and 2799A-2(b) (1)(A), and these interim final rules, upon receiving an initial payment or notice of denial of payment from a plan or issuer with respect to such items or services, such provider or facility or provider of air ambulance services (as applicable) or plan or issuer (as applicable) may initiate an open negotiation period within 30 business days beginning on the date the provider or facility receives the initial payment or notice of denial of payment. The open negotiation period may continue for up to 30 business days beginning on the date that either party first initiates the open negotiation period. The parties may discontinue the negotiation if they agree on 476 an out-of-network rate before the last day of the 30-business-day open negotiation period. If the parties cannot agree on an out-of-network rate, they must exhaust the 30-business-day open negotiation period before initiating the Federal IDR process. Either party may initiate the Federal IDR process during the 4-business-day period beginning on the 31st business day after the start of the open negotiation period. The parties may select a certified IDR entity, or if the parties do not select a certified IDR entity, the Departments will do so. The No Surprises Act and these interim final rules specify that the certified IDR entity selected cannot be a party to the determination or an employee or agent of such a party, or have a material familial, financial, or professional relationship with such party. In resolving the disputes through the Federal IDR process, the No Surprises Act and these interim final rules provide that each party must submit to the certified IDR entity an offer for a payment amount for the qualified IDR item or service in dispute and other information related to the offer as requested by the certified IDR entity within 10 business days of selection of the certified IDR entity and may submit additional information for the certified IDR entity to consider. In making a determination of which payment offer to select, these interim final rules specify that the certified IDR entity must begin with the presumption that the QPA is the appropriate out-ofnetwork rate for the qualified IDR item or service under consideration. These interim final rules further provide that the certified IDR entity must select the offer closest to the QPA unless the certified IDR entity determines that credible information submitted by either party clearly demonstrates that the QPA is materially different from the appropriate out-of-network rate, based on the additional factors set forth in Code sections 9816(c)(5)(C)(ii) and 9817(b)(5)(C)(ii), ERISA sections 716(c)(5)(C)(ii) and 717(b)(5)(C)(ii), and PHS Act sections 2799A-1(c)(5)(C)(ii) and 2799A-2(b)(5) (C)(ii). The certified IDR entity may not consider usual and customary charges, the amount that would have been billed (including billed charges that are directed to the plan or issuer) if the protections of Bulletin No. 2021–42 45 CFR 149.410, 149.420, or 149.44015 (as applicable) had not applied, or any public payor payment or reimbursement rates.16 As discussed more fully in section III.D.4.ii. of this preamble, this approach is consistent with the No Surprises Act’s emphasis on the QPA, both as the basis of the surprise billing protections also included in the statute and implemented by the July 2021 interim final rules and as the sole factor identified without any qualification by the statute.17 The Departments are of the view that implementing the Federal IDR process in this manner encourages predictable outcomes, which will reduce the use of the Federal IDR process over time and the associated administrative fees born by the parties, while providing equitable and clear standards for when payment amounts may deviate from the QPA, as appropriate. The No Surprises Act and these interim final rules also set forth requirements for certification of IDR entities by the Departments. To become certified IDR entities, IDR entities must provide written documentation demonstrating that they meet the eligibility criteria, including having sufficient expertise and staffing to conduct determinations on a timely basis, being free of conflicts of interest, being accredited by a nationally recognized and relevant accrediting body (such as URAC) or otherwise ensuring that IDR entity personnel possess the requisite training to conduct payment determinations (for example, providing documentation that personnel employed by the IDR entity have completed arbitration training by the American Arbitration Association (AAA), the American Health Law Association (AHLA), or a similar organization), ensuring policies and procedures are in place to maintain confidentiality of individually identifiable health information, providing a fixed fee for single determinations and a separate fee for batched determinations, having a procedure in place to retain certified IDR entity fees and retain and remit administrative fees, meeting appropriate indicators of fiscal integrity and stability, evidencing its ability to collect and transmit the information required to be reported to the Departments, and properly carrying out the requirements of the Federal IDR process in accordance with the law. These interim final rules also establish a process whereby members of the public, providers, facilities, providers of air ambulance services, plans, or issuers may petition for the denial or revocation of certification of an IDR entity. Finally, these interim final rules require the collection of information related to the Federal IDR process from certified IDR entities in order to allow the Departments to quarterly publish information on IDR payment determinations. The Departments are also establishing a Federal IDR portal to administer the Federal IDR process. The Departments’ Federal IDR portal will be available at https://www.nsa-idr.cms.gov and will be used throughout the Federal IDR process to maximize efficiency and reduce burden. As discussed throughout this preamble, the Federal IDR portal may be used to satisfy various requirements under these interim final rules, including provision of notices, Federal IDR initiation, submission of an application to be a certified IDR entity, as well as satisfying reporting requirements. These interim final rules also amend final regulations issued by the Departments in 2015 related to external review in order to implement section 110 of the No Surprises Act. Section 110 requires that “[i]n applying the provisions of section 2719(b) of the [PHS Act] to group health plans and health insurance issuers offering group or individual health insurance coverage, the Secretary of [HHS], Secretary of Labor, and Secretary of the Treasury, shall require, beginning not later than January 1, 2022, the external review process described in paragraph (1) of such section to apply with respect to any adverse determination by such a plan or issuer under Code section 9816 or 9817, ERISA section 716 or 717, or PHS Act section 2799A-1 or 2799A-2, including with respect to whether an item or service that is the subject to such a determination is an item or service to which such respective section applies.” Accordingly, these interim final rules amend the final regulations regarding external review in two ways. First, the scope of adverse benefit determinations eligible for external review is amended to ensure that issues related to compliance with the specified provisions of the No Surprises Act fall within that scope. Several examples are also added to provide greater clarity to stakeholders regarding the expanded scope. Second, applicability provisions are amended to require that grandfathered health plans, which generally are exempt from requirements related to external review, must nonetheless provide for external review of adverse benefit determinations for claims subject to the cost-sharing and surprise billing protections in the No Surprises Act. The Departments seek comment on all aspects of these interim final rules. B. Office of Personnel Management: Federal IDR Process for FEHB Carriers The OPM interim final rules amend existing 5 CFR 890.114(a) to include references to the Treasury, DOL, and HHS interim final rules to clarify that pursuant to 5 U.S.C. 8902(p), FEHB carriers are also subject to the Federal IDR process set forth in those regulations with respect to an item or service eligible for determination through open negotiation or the Federal IDR process furnished by a FEHB carrier offering a health benefits plan in the same manner as those provisions apply to a group health plan or health insurance The July 2021 interim final rules prohibit nonparticipating emergency facilities and nonparticipating providers furnishing emergency services from billing participants, beneficiaries, or enrollees for payment amounts that exceed the cost-sharing requirement for those items or services. The July 2021 interim final rules also generally prohibit nonparticipating providers furnishing nonemergency items and services at participating facilities from balance billing participants, beneficiaries, or enrollees for those items or services. In addition, the July 2021 interim final rules prohibit nonparticipating providers of air ambulance services furnishing air ambulance services for which benefits are available under a group health plan or group or individual health insurance coverage from balance billing participants, beneficiaries, or enrollees for those items or services. 16 Public payor payment and reimbursement rates include reimbursement rates under the Medicare program under title XVIII of the Social Security Act, under the Medicaid program under title XIX of such Act, under the Children’s Health Insurance Program under title XXI of such Act, under the TRICARE program under chapter 55 of title 10, United States Code, and under chapter 17 of title 38, United States Code. 17 The No Surprises Act limits the certified IDR entity’s consideration of additional factors by prohibiting the certified IDR entity from considering certain other factors, such as usual and customary charges and billed charges, in making a payment determination. 15 Bulletin No. 2021–42 477 October 18, 2021 issuer offering group or individual health insurance coverage, subject to 5 U.S.C. 8902(m)(1) and the provisions of the FEHB carrier’s contract. Through new 5 CFR 890.114(d), OPM adopts the Departments’ interim final rules as conformed by terms unique to the FEHB Program. In 5 CFR 890.114(d), OPM adopts the Departments’ rules as necessary to properly integrate with existing FEHB Program structure and sets forth circumstances in which OPM will enforce these rules as applied to FEHB carriers. The OPM interim final rules require FEHB carrier notice to the OPM Director (herein, the Director) of an FEHB carrier’s notice of initiation, or receipt of a provider’s notice of initiation, of the Federal IDR process. The Director will coordinate with the Departments in matters regarding FEHB carriers requiring resolution under the Federal IDR process and with respect to oversight of certified IDR entities’ reports regarding FEHB carriers. As discussed in the July 2021 interim final rules, all out-of-network rate determinations regarding IDR items or services eligible for determination through open negotiation or the Federal IDR process under the No Surprises Act with respect to FEHB plans or carriers that are not resolved by open negotiation are subject to the Federal IDR process unless OPM contracts with FEHB carriers include terms that adopt state law as governing for this purpose. C. Department of HHS: Protections for the Uninsured To ensure that uninsured (or self-pay) individuals are also afforded protections against surprise health care costs, the No Surprises Act includes provisions that require providers and facilities to furnish good faith estimates to uninsured (or selfpay) individuals upon their request and at the time of scheduling the item or service. In order to implement these provisions under PHS Act sections 2799B-6(1) and 2799B-6(2)(B), HHS is adding 45 CFR 149.610 to establish requirements for providers and facilities to specifically inquire about an individual’s health coverage status and requirements for providing a good faith estimate to uninsured (or selfpay) individuals. These interim final rules October 18, 2021 define uninsured (or self-pay) individuals to include those who do not have benefits for an item or service under a group health plan, group or individual health insurance coverage offered by a health insurance issuer, a Federal health care program (as defined in section 1128B(f) of the Social Security Act), or a health benefits plan under chapter 89 of title 5, United States Code, or an individual who has benefits for such item or service under a group health plan or individual or group health insurance coverage offered by a health insurance issuer, but who does not seek to have a claim for such item or service submitted to such plan or coverage. PHS Act section 2799B-6, added by section 112 of the No Surprises Act, does not specifically define a Federal health care program and also does not reference health benefits plans under chapter 89 of title 5. However, PHS Act section 2799B7, which was also added by section 112 of the No Surprises Act, and which provides protections related to the good faith estimate required under PHS Act section 2799B-6, defines an uninsured individual to include individuals not enrolled in a Federal health care program (as defined in section 1128B(f) of the Social Security Act) and individuals not enrolled in health benefits plans under chapter 89 of title 5. To align these two related sections, HHS is adopting the definition of an uninsured (or self-pay) individual at PHS Act section 2799B-7 for the purposes of the interim final rules at 45 CFR 149.610 which implements PHS Act section 2799B-6(1) and 2799B-6(2)(B) and 45 CFR 149.620 which implements PHS Act section 2799B-7. The definition of uninsured (or selfpay) individuals in these interim final rules includes individuals enrolled in individual or group health insurance coverage offered by a health insurance issuer, or a health benefits plan under chapter 89 of title 5, but not seeking to have a claim for such item or service submitted to such plan or coverage. These individuals are often referred to as self-pay individuals, therefore these interim final rules include the term self-pay when discussing uninsured individuals. Under PHS Act section 2791(b)(5), short-term, limited-duration insurance is 478 excluded from the definition of individual health insurance coverage. Therefore, for purposes of 45 CFR 149.610 and 45 CFR 149.620, uninsured (or self-pay) individuals include individuals who are enrolled in short-term, limited-duration insurance and not also enrolled in a group health plan, group or individual health insurance coverage offered by a health insurance issuer, Federal health care program (as defined in section 1128B(f) of the Social Security Act), or a health benefits plan under chapter 89 of title 5, United States Code. Thus, providers and facilities will be required to provide to such individuals a good faith estimate and such individuals will be able to avail themselves of the patient-provider dispute resolution process, where applicable. PHS Act section 2799B-6(2) and these interim final rules specify that a provider or facility must provide a notification (in clear and understandable language) of the good faith estimate of the expected charges for furnishing the items or services listed on the good faith estimate (including any items or services that are reasonably expected to be provided in conjunction with such scheduled or requested items or services and such items or services reasonably expected to be so provided by another health care provider or health care facility), with the expected billing and diagnostic codes for any such items or services. As discussed in section I.C. of this preamble, requirements to implement PHS Act section 2799B-6(2)(A) are not included in these interim final rules given the challenges of developing the technical infrastructure necessary to transmit such data from providers and facilities to plans and issuers. The requirements in these interim final rules apply only to good faith estimate notifications for uninsured (or self-pay) individuals as described in PHS Act section 2799B-6(2)(B) and in these interim final rules. HHS acknowledges that PHS Act section 2799B-6 also requires providers and facilities to make certain disclosures to an individual’s plan or coverage if the individual is enrolled in such a plan or coverage and is seeking to have a claim for such items or services submitted to such plan or coverage. Specifically, section 2799B-6(2)(A) requires a Bulletin No. 2021–42 provider or facility to provide such a plan or issuer notification of the good faith estimate of expected charges for furnishing an item or service on the same terms as provided to individuals. Health care providers and health care facilities are required under PHS Act section 2799B-6 to furnish a notification of the good faith estimate of expected charges to an uninsured (or self-pay) individual who schedules an item or service, and to an individual who has not yet scheduled an item or service, but requests a good faith estimate. PHS Act section 2799B-6 requires providers and facilities to furnish a good faith estimate to an uninsured (or self-pay) individual who schedules an item or service at least 3 business days before the date such item or service is to be so furnished, not later than 1 business day after the date of such scheduling (or, in the case of such an item or service scheduled at least 10 business days before the date such item or service is to be so furnished (or if requested by the uninsured (or self-pay) individual), not later than 3 business days after the date of such scheduling or such request). As further discussed in section VI of this preamble, in instances where an uninsured (or self-pay) individual requests a good faith estimate of expected charges, but the item or service has not been scheduled, these interim final rules require that the treating provider furnish a good faith estimate to the uninsured (or self-pay) individual, within 3 business days of such request. For example, if an uninsured (or self-pay) individual schedules an item or service on Monday, January 3 to be provided on Thursday, January 6, the provider and facility must furnish a good faith estimate no later than Tuesday, January 4. If scheduling occurs on Monday, January 3 for items or services to be provided on Thursday, January 13, the provider and facility must furnish a good faith estimate no later than Thursday, January 6. If an uninsured (or self-pay) individual requests a good faith estimate on Mon- day, January 3 for items or services not yet scheduled, the provider and facility must furnish the good faith estimate no later than Thursday, January 6. These interim final rules include definitions relating to good faith estimates of expected charges for uninsured (or selfpay) individuals for scheduled items or services and upon request. These interim final rules also include requirements for providers and facilities regarding the contents of the good faith estimates and the manner in which good faith estimates must be provided. PHS Act section 2799B-7 provides further protections for the uninsured (or selfpay) individual by requiring the Secretary of HHS to establish a process (in this section referred to as patient-provider dispute resolution) under which an uninsured (or self-pay) individual who received from a provider or facility a good faith estimate of the expected charges, and who, after being furnished the item or service, is billed an amount that is substantially in excess of the expected charges in the good faith estimate, may seek a determination from a certified dispute resolution entity of the amount to be paid to the provider or facility. HHS is adding new 45 CFR 149.620 to implement this patient-provider dispute resolution process, including specific definitions related to the process. HHS is also codifying provisions related to eligibility for the patient-provider dispute resolution process, and selection of an SDR entity. HHS clarifies that while SDR entities provide a similar function and must meet similar requirements as certified IDR entities, SDR entities are specific to the patient-provider dispute resolution process. These interim final rules also codify requirements related to the determination of payment amounts by SDR entities, fees associated with the patient-provider dispute resolution process, certification of SDR entities, and deferral to state-established patient-provider dispute resolution processes that meet certain minimum Federal standards. III. Overview of the Interim Final Rules Regarding the Federal Independent Dispute Resolution Process for Plans, Issuers, Providers, Facilities, and Providers of Air Ambulance Services – Departments of the Treasury, Labor, and HHS A. Definitions Code section 9816, ERISA section 716, and PHS Act sections 2799A-1 and 2799A-2 include defined terms that are specific to the law’s requirements and implementation.18 The definitions in 26 CFR 54.9816-3T, 29 CFR 2590.7163, and 45 CFR 149.30 apply to these interim final rules; these interim final rules also define additional terms specific to the Federal IDR process. Under these interim final rules, “batched items and services” means multiple qualified IDR items or services that are considered jointly as part of one payment determination by a certified IDR entity for purposes of the Federal IDR process. For a qualified IDR item or service to be included as a batched item or service, the qualified IDR item or service must satisfy the criteria for batching set forth in 26 CFR 54.9816-8T(c)(3), 29 CFR 2590.716-8(c) (3), and 45 CFR 149.510(c)(3). “Certified IDR entity” means an entity responsible for conducting determinations under 26 CFR 54.9816-8T(c), 29 CFR 2590.7168(c), and 45 CFR 149.510(c) that meets the certification criteria specified in 26 CFR 54.9816-8T(e), 29 CFR 2590.7168(e), and 45 CFR 149.510(e) and that has been certified by the Departments. Separately, “IDR entity” means an entity that may apply or has applied for certification to conduct determinations under 26 CFR 54.9816-8T(c), 29 CFR 2590.716-8(c), and 45 CFR 149.510(c) and currently is not certified by the Departments pursuant to 26 CFR 54.9816-8T(e), 29 CFR 2590.716-8(e), and 45 CFR 149.510(e). If a certified IDR entity’s certification has expired or has been revoked as a result of the process described in 26 CFR 54.9816- To implement these interim final rules regarding the Federal IDR process under the PHS Act, HHS is amending 45 part CFR 149 by adding new Subparts F and G. Additionally, the Departments are amending 26 CFR 54.9816-1T and 54.9816-2T, 29 CFR 2590.716-1 and 2590.716-2 and 45 CFR 149.10 and 149.20 to expand the scope and applicability of this part to include IDR entities and the Federal IDR process. HHS is also amending 45 CFR 149.10 and 149.20 to expand the scope and applicability of this part to include SDR entities, the good faith estimate requirements, and patient-provider dispute resolution process. 18 Bulletin No. 2021–42 479 October 18, 2021 8T(e)(6), 29 CFR 2590.716-8(e)(6), and 45 CFR 149.510(e)(6), upon the date of the expiration or revocation, the formerly-certified IDR entity will be referred to as an IDR entity. These interim final rules also define certain terms related to conflict-of-interest standards applicable to certified IDR entities. Stakeholders have emphasized the importance of ensuring a broad conflict-of-interest standard in order to avoid the risk of biased IDR payment determinations (or the appearance of biased IDR payment determinations). In general, a “conflict of interest” means, with respect to a party to a payment determination, a certified IDR entity, a material relationship, status, or condition of the party, or certified IDR entity that impacts the ability of a certified IDR entity to make an unbiased and impartial payment determination. For purposes of these interim final rules, a conflict of interest exists when a certified IDR entity is a group health plan; a health insurance issuer offering group health insurance coverage, individual health insurance coverage or short-term, limited-duration insurance; an FEHB carrier; or a provider, a facility,19 or a provider of air ambulance services. While the statute does not specify that the IDR entity must not be a health insurance issuer offering short-term, limited-duration insurance, the Departments have determined that such entities should not be eligible for certification, due to their similarity to health insurance issuers offering group and individual health insurance coverage and their inherent interest as issuers in keeping reimbursement rates for providers, facilities, and providers of air ambulance services low. A conflict of interest also exists when a certified IDR entity is an affiliate or a subsidiary of a group health plan; a health insurance issuer offering group health insurance coverage, individual health insurance coverage or short-term, limited-duration insurance; an FEHB carrier; or provider, facility, or provider of air ambulance services. A conflict of interest also exists when a certified IDR entity is an affiliate or subsidiary of a professional or trade association representing group health plans; health insurance issuers offering group health insurance coverage, individual health insurance coverage or short-term, limited-duration insurance; FEHB carriers; or providers, facilities, or providers of air ambulance services. Additionally, a conflict of interest exists when a certified IDR entity has, or any personnel assigned to a determination have a material familial, financial, or professional relationship with a party to the payment determination being disputed, or with any officer, director, or management employee of the plan, issuer or carrier offering a health benefits plan under 5 U.S.C. 8902; the plan administrator, plan fiduciaries, or plan, issuer, or carrier’s employees; the health care provider, the health care provider’s group or practice association; the provider of air ambulance services, the provider of air ambulance services’ group or practice association, or the facility that is a party to the dispute. The Departments are of the view that an officer, director, or management employee of the plan issuer, or carrier offering a health benefits plan under 5 U.S.C. 8902; the plan administrator, plan fiduciaries, or plan, issuer or carrier employees; the health care provider, the health care provider’s group or practice association; the provider of air ambulance services, the provider of air ambulance services’ group or practice association, or the facility that is a party to the dispute are individuals who could have significant involvement with the dispute. Relationships with these individuals could therefore improperly affect the certified IDR entities’ ability to be impartial. These interim final rules also define what constitutes a material familial relationship, a material financial relationship, or material professional relationship with a party to the payment determination. In developing these definitions, the Departments looked to states’ conflict-of-interest standards for external review and arbi- trations of surprise billing claims. These state standards typically use terms that are similar to those used in Code section 9816(c)(4)(F)(i)(II), ERISA section 716(c)(4)(F)(i)(II), and PHS Act section 2799A-1(c)(4)(F)(i)(II).20 By adopting definitions that largely mirror these state standards, the Departments seek to ensure that the definitions are workable and increase the likelihood that IDR entities may be familiar with these standards, if they have performed services in these states. Accordingly, these interim final rules provide that the term “material familial relationship” means any relationship as a spouse, domestic partner, child, parent, sibling, spouse’s or domestic partner’s parent, spouse’s or domestic partner’s sibling, spouse’s or domestic partner’s child, child’s parent, child’s spouse or domestic partner, or sibling’s spouse or domestic partner. “Material financial relationship” means any financial interest of more than five percent of total annual revenue or total annual income of a certified IDR entity or an officer, director, or manager thereof, or of a reviewer or reviewing physician employed or engaged by a certified IDR entity to conduct or participate in any payment determination under the Federal IDR process. Under the definition of “material financial relationship,” annual revenue and annual income do not include mediation fees received by mediators who are also arbitrators, provided that the mediator acts in the capacity of a mediator and does not represent a party in the mediation. Finally, with respect to terms related to the conflict-of-interest standards, “material professional relationship” means any physician-patient relationship, any partnership or employment relationship or affiliation, any shareholder or similar ownership interest in a professional corporation, partnership, or other similar entity, or any independent contractor arrangement that constitutes a material financial relationship with any expert used by the certified IDR entity or any officer or director of the certified IDR Similar to the July 2021 interim final rules, the term “facility” indicates a facility that furnishes health care services that is subject to the surprise billing protections of the No Surprises Act, such as a hospital (including a hospital’s emergency department), urgent care center, or ambulatory surgical center. For purposes of good faith estimates under 45 CFR 149.610 and the Patient-Provider dispute resolution process in 45 CFR 149.620 "facility" includes an institution (such as a hospital or hospital outpatient department, critical access hospital, ambulatory surgical center, rural health center, federally qualified health center, laboratory, or imaging center) in any state in which state or applicable local law provides for the licensing of such an institution, that is licensed as such an institution pursuant to such law or is approved by the agency of such state or locality responsible for licensing such institution as meeting the standards established for such licensing. 20 See e.g., WAC 284-43A-010; N.Y. Comp. Codes R. & Regs. tit. 11 section 410.2. 19 October 18, 2021 480 Bulletin No. 2021–42 entity. The Departments solicit comment on whether the defined terms related to the conflict-of-interest standards should include threshold requirements to further define the level of relationship that would rise to the level of a conflict of interest. Additionally, under these interim final rules, the Departments define certain terms related to confidentiality, information security, and privacy requirements that apply to an IDR entity seeking certification under these interim final rules. Code section 9816(c)(4)(A)(v), ERISA section 716(c)(4)(A)(v), and PHS Act section 2799A-1(c)(4)(A)(v) require certified IDR entities to maintain the confidentiality of individually identifiable health information (IIHI) obtained while making payment determinations and engaging in other activities related to the Federal IDR process. In establishing definitions for these terms, the Departments looked to existing Federal standards, particularly the Health Insurance Portability and Accountability Act of 1996 (HIPAA), the Health Information Technology for Economic and Clinical Health (HITECH) Act, and the privacy, security, and breach notification standards under 45 CFR part 160 A and subparts A, C, D, and E of part 164, because the Departments are of the view that these provisions are industry standards. The Departments have modified these standards in some cases to fit the circumstances of IDR entities. These interim final rules define “Individually identifiable health information (IIHI)” to mean any information, including demographic data, that relates to the past, present, or future physical or mental health or condition of an individual; the provision of health care to an individual; or the past, present, or future payment for the provision of health care to an individual; and that identifies the individual; or with respect to which there is a reasonable basis to believe the information can be used to identify the individual.21 Finally, these interim final rules define “Unsecured IIHI” to mean IIHI that is not rendered unusable, unreadable, or indecipherable to unauthorized persons through the use of a technology or methodology specified by the Departments. For technologies and methodologies approved for this purpose, certified IDR entities should refer to the HHS Guidance to Render Unsecured Protected Health Information Unusable, Unreadable, or Indecipherable to Unauthorized Individuals.22 These interim final rules provide that the term “breach” means the acquisition, access, use, or disclosure of IIHI in a manner not permitted under 26 CFR 54.98168T(e)(2)(v), 29 CFR 2590.716-8(e)(2) (v), and 45 CFR 149.510(e)(2)(v) that compromises the security or privacy of the IIHI. Under these interim final rules, a breach excludes any unintentional acquisition, access, or use of IIHI by personnel, including a contractor or subcontractor, acting under the authority of a certified IDR entity, if the acquisition, access, or use was made in good faith and within the scope of authority and does not result in further use or disclosure in a manner not permitted under 26 CFR 54.9816-8T(e) (2)(v), 29 CFR 2590.716-8(e)(2)(v), and 45 CFR 149.510(e)(2)(v). Also excluded is any inadvertent disclosure by a person who is authorized to access IIHI as personnel of a certified IDR entity to another person authorized to access IIHI as personnel of the same certified IDR entity (including a contractor or subcontractor of the certified IDR entity), and the information received as a result of such disclosure is not further used or disclosed in a manner not permitted under 26 CFR 54.98168T(e)(2)(v), 29 CFR 2590.716-8(e)(2)(v), and 45 CFR 149.510(e)(2)(v). Finally, also excluded is a disclosure of IIHI when a certified IDR entity has a good faith belief that an unauthorized person to whom the disclosure was made would not reasonably have been able to retain such information. For example, if, while conducting an IDR payment determination, a certified IDR entity sends paperwork containing IIHI to the wrong address and the paperwork is returned by the post office, unopened, as undeliverable, the certified IDR entity can conclude that the entity at the improper address could not reasonably have retained the information. The definition of breach additionally pro- vides that an acquisition, access, use, or disclosure of IIHI in a manner not permitted under 26 CFR 54.9816-8T(e)(2) (v), 29 CFR 2590.716-8(e)(2)(v), and 45 CFR 149.510(e)(2)(v) is presumed to be a breach unless the certified IDR entity demonstrates that there is a low probability that the security or privacy of the IIHI has been compromised based on a risk assessment of at least the following factors: (1) the nature and extent of the IIHI involved, including the types of identifiers and the likelihood of re-identification; (2) the unauthorized person who used the IIHI or to whom the disclosure was made; (3) whether the IIHI was actually acquired or viewed; and (4) the extent to which the risk to the IIHI has been mitigated. Additionally, “qualified IDR item or service” means an item or service that is either an emergency service furnished by a nonparticipating provider or nonparticipating emergency facility subject to the protections of 26 CFR 54.9816-4T, 29 CFR 2590.716-4, or 45 CFR 149.110, for which the conditions of 45 CFR 149.410(b) (regarding receipt of notice of surprise billing protections and providing consent to waive them) are not met. The term also means an item or service furnished by a nonparticipating provider at a participating health care facility subject to the requirements of 26 CFR 54.9816-5T, 29 CFR 2590.716-5, and 45 CFR 149.120, for which the conditions of 149.420(c)(i) (regarding receipt of notice of surprise billing protections and providing consent to waive them) are not met, for which the provider or facility (as applicable) or plan or issuer submits a valid Notice of IDR Initiation initiating the Federal IDR process. For the Notice of IDR Initiation to be valid, the open negotiation period under 26 CFR 54.9816-8T(b)(1), 29 CFR 2590.716-8(b) (1), and 45 CFR 149.510(b)(1) must have lapsed, and an agreement on the payment amount must not have been reached. The term qualified IDR item or service includes air ambulance services provided by nonparticipating providers of air ambulance services subject to the protections of 26 CFR 54.9817-1T, 29 CFR 2590.717-1, and 45 CFR 149.130, as these services are Note that this definition is broader than the definition of IIHI set forth in the Health Insurance Portability and Accountability Act (HIPAA) Rules at 45 CFR 160.103. HHS Office for Civil Rights, “Guidance to Render Unsecured Protected Health Information Unusable, Unreadable, or Indecipherable to Unauthorized Individuals,” available at https:// www.hhs.gov/guidance/document/guidance-render-unsecured-protected-health-information-unusable-unreadable-or 21 22 Bulletin No. 2021–42 481 October 18, 2021 defined in 26 CFR 54.9816-3T, 29 CFR 2590.716-3, and 45 CFR 149.30, for which the open negotiation period under 26 CFR 54.9816-8T(b)(1), 29 CFR 2590.716-8(b) (1), and 45 CFR 149.510(b)(1) has lapsed, and no agreement on the payment amount has been reached. The term “qualified IDR item or service” does not include items and services for which the out-of-network rate is determined by an All-Payer Model Agreement under section 1115A of the Social Security Act, or by reference to a specified state law. Additionally, this term does not include items or services submitted by the initiating party that are subject to the 90-calendar-day suspension period under 26 CFR 54.9816-8T(c)(4)(vii)(B), 29 CFR 2590.716-8(c)(4)(vii)(B), and 45 CFR 149.510(c)(4)(vii)(B). However, the term may include items or services that are subject to the 90-calendar-day suspension period if they are submitted during the subsequent 30-business-day period, as allowed under these interim final rules. The Departments solicit comment on these definitions, including whether other terms should be defined. B. The Term “Days” The No Surprises Act specifies a number of time periods that providers, facilities, providers of air ambulance services, plans, issuers, certified IDR entities, and the Departments must abide by throughout the course of the Federal IDR process, including time periods for initiation of the Federal IDR process, selection of a certified IDR entity, submission of documents, and payment determinations. The statute is largely silent on whether the term “days” used in these provisions means business days or calendar days. However, in certain provisions, the No Surprises Act specifies the use of calendar days or business days, indicating that where the statute is silent the Departments may choose either meaning. The Departments received feedback from stakeholders that meeting various deadlines under the Federal IDR process may be challenging (for example, depending on a certified IDR entity’s case load or the number of claims that a provider or facility batches together) and that, if possible, additional time should be provided for the parties and the certified IDR entity to meet these deadlines. The Departments are of the view that in order to provide parties with the most time permitted under the statute to meet the various deadlines under the Federal IDR process as set forth in the No Surprises Act, business days should be used, unless there is a reason to use calendar days. For example, these interim final rules provide that calendar days are used for the timing requirement for the non-prevailing party to make payment after the certified IDR entity issues a written determination, as well as the requirement barring the initiation of the Federal IDR process for a payment dispute that concerns the same or similar qualified IDR item or service that was the subject of the initial notification during the 90-calendar-day period following the initial determination discussed later in this preamble. In these instances, the Departments are of the view that once a decision has been rendered, these interim final rules should not unduly delay the payment entitled under that decision. Moreover, in terms of the 90-day suspension period, the Departments are of the view that using a business day standard here has the potential to create an unnecessary barrier to accessing the Federal IDR process. Furthermore, the Departments are of the view that using business days will avoid issues that may arise if deadlines were to fall on weekends or Federal holidays. Therefore, business days (Monday through Friday, not including Federal holidays) instead of calendar days are used throughout these interim final rules for the Federal IDR process unless otherwise indicated, regardless of whether a nonparticipating provider or facility, or a plan or issuer’s business typically operates on weekend days. C. Open Negotiation and Initiation of the Federal IDR Process Code section 9816(c)(1)(A), ERISA section 716(c)(1)(A), PHS Act section 2799A-1(c)(1)(A), and these interim final rules provide that with respect to an emergency service, a nonemergency item or service furnished by a nonparticipating provider at a participating facility subject to the surprise billing protections for which the notice and consent exceptions do not apply, and for which the out-of-network rate is not determined by reference to an All-Payer Model Agreement under section 1115A of the Social Security Act or specified state law as defined in 26 CFR 54.9816-3T, 29 CFR 2590.716-3, and 45 CFR 149.30, the provider or facility, or plan or issuer, may engage in open negotiations to determine the total out-of-network rate (including any cost sharing). If the parties fail to reach an agreement through open negotiation, they may initiate the Federal IDR process. Code section 9817(b), ERISA section 717(b), and PHS Act section 2799A-2(b) provide that out-of-network rates for air ambulance services may be determined through open negotiation or an IDR process that is largely identical to the process provided for in Code section 9816(c), ERISA section 716(c), and PHS Act section 2799A-1(c), provided the out-of-network rate is not determined by reference to an All-Payer Model Agreement under section 1115A of the Social Security Act or specified state law as defined in 26 CFR 54.9816-3T, 29 CFR 2590.716-3, and 45 CFR 149.30. Therefore, where applicable, providers of air ambulance services are included in the preamble and regulatory language text describing open negotiations and the Federal IDR process. The primary distinctions between air ambulance services and other health care services apply in how the certified IDR entity should select an offer and in the obligations on the certified IDR entity regarding reporting of information relating to the Federal IDR process. 1. Open Negotiation The open negotiation period may be initiated by any party during the 30-business-day period beginning on the day the nonparticipating provider, facility, or nonparticipating provider of air ambulance services receives either an initial payment or a notice of denial of payment for an item or service.23 If the provider, facility, or provider of air ambulance services As clarified in the July 2021 interim final rules, the initial payment should be an amount that the plan or issuer reasonably intends to be payment in full based on the relevant facts and circumstances, prior to the beginning of any open negotiations or initiation of the Federal IDR process. 23 October 18, 2021 482 Bulletin No. 2021–42 accepts such initial payment as the total payment, that initial payment combined with the cost-sharing amount for the item or service is the out-of-network rate, as defined in 26 CFR 54.9816-3T, 29 CFR 2590.716-3, and 45 CFR 149.30. Under the July 2021 interim final rules, the plan or issuer must provide in writing, with each initial payment or notice of denial of payment, certain information, including a statement that if the provider, facility, or provider of air ambulance services, as applicable, wishes to initiate a 30-business-day open negotiation period for purposes of determining the out-of-network rate, the provider, facility, or provider of air ambulance services may contact the appropriate person or office to initiate open negotiation, and that if the 30-business-day open negotiation period does not result in an agreement on the out-of-network rate, generally, the provider, facility, or provider of air ambulance services may initiate the Federal IDR process. The plan or issuer must also provide contact information, including a telephone number and email address, for the appropriate person or office to initiate open negotiations for purposes of determining an amount of payment (including cost sharing) for the item or service. In order for a plan, issuer, provider, facility, or provider of air ambulance services to know when it is a party to an open negotiation period and which items or services are subject to negotiation, these interim final rules require that the party initiating the open negotiation must provide written notice to the other party of its intent to negotiate, referred to as an open negotiation notice. The open negotiation notice must include information sufficient to identify the items or services subject to negotiation, including the date the item or service was furnished, the service code, the initial payment amount or notice of denial of payment, as applicable, an offer for the out-of-network rate, and contact information of the party sending the open negotiation notice. The open negotiation notice must be sent within 30 business days of the initial payment or notice of denial of payment from the plan or issuer regarding such item or service and must be provided in writing. The party sending the open negotiation notice may satisfy this requirement by providing the notice to Bulletin No. 2021–42 the opposing party electronically (such as by email) if the following two conditions are satisfied: (1) the party sending the open negotiation notice has a good faith belief that the electronic method is readily accessible to the other party; and (2) the notice is provided in paper form free of charge upon request. For example, if a provider sends an open negotiation notice to the email address identified by the group health plan or issuer in the notice of denial or initial payment, such electronic delivery would satisfy this requirement (as long as the provider also sends the notice in paper form free of charge upon request). Similarly, if a provider, facility, or provider of air ambulance services submits a claim electronically, this could provide the plan or issuer with a good faith belief that the electronic method is readily accessible to the other party. The 30-business-day open negotiation period begins on the day on which the open negotiation notice is first sent by a party. The Departments expect that most open negotiation notices will be sent electronically, and that, in general, the date the notice is sent will also be the date the notice is received. Furthermore, given that the parties have already made initial contact (namely that the provider or facility has transmitted a bill to the plan or issuer, and the plan or issuer has sent a notice of denial or initial payment to the provider or facility), the Departments anticipate that the parties should be able to provide effective notice without problems, and encourage the parties to take reasonable measures to ensure that actual notice is provided, such as confirming that the email address is accurate. The Departments caution that if the open negotiation notice is not properly provided to the other party (and no reasonable measures have been taken to ensure actual notice has been provided), the Departments may determine that the 30-business-day open negotiation period has not begun. In such case, any subsequent payment determination from a certified IDR entity may be unenforceable due to the failure of the party sending the open negotiation notice to meet the open negotiation requirement of these interim final rules. Therefore, the Departments encourage parties submitting open negotiation notices to take steps to confirm the other party’s contact informa- 483 tion and confirm receipt by the other party, through approaches such as read receipts, especially where a party does not initially respond to an open negotiation notice. The Departments solicit comment on whether there are any challenges or additional clarifications needed to ensure the parties are afforded the full open negotiation period, including whether there are any challenges regarding designating the date the notice is sent as the commencement date of the open negotiation period. To facilitate communication between parties and compliance with this notice requirement, the Departments are concurrently issuing a standard notice that the parties must use to satisfy the open negotiation notice requirement. Negotiation during the open negotiation period will occur without the involvement of the Departments or a certified IDR entity. The Departments note that this requirement for a 30-business-day open negotiation period prior to initiating the Federal IDR process does not preclude the parties from reaching an agreement in fewer than 30 business days. However, in the event the parties do not reach an agreement, the parties must still exhaust the 30-business-day open negotiation period before either party may initiate the Federal IDR process. The Departments encourage parties to negotiate in good faith during this time period to reach an agreement on the out-of-network rate. To the extent parties reach agreement during this period, they can avoid the administrative costs associated with the Federal IDR process. 2. Initiating the Federal IDR Process and the Notice of IDR Initiation Code section 9816(c)(1)(B), ERISA section 716(c)(1)(B), PHS Act section 2799A-1(c)(1)(B), and these interim final rules provide that with respect to items or services that were subject to open negotiation, if the parties have not reached an agreed-upon amount for the out-ofnetwork rate by the last day of the open negotiation period, either party may initiate the Federal IDR process during the 4-business-day period beginning on the 31st business day after the start of the open negotiation period. A party may not initiate the Federal IDR process if, with October 18, 2021 respect to an item or service, the party knows or reasonably should have known that the provider or facility provided notice and obtained consent from a participant, beneficiary, or enrollee to waive surprise billing protections consistent with PHS Act sections 2799B-1(a) and 2799B2(a) and the implementing regulations at 45 CFR 149.410(b) and 149.420(c)-(i). To initiate the Federal IDR process, the initiating party must submit a notice to the other party and to the Departments (Notice of IDR Initiation) through the Federal IDR portal. The Notice of IDR Initiation must include: (1) information sufficient to identify the qualified IDR items or services (and whether the qualified IDR items or services are designated as batched items and services), including the dates and location of the items or services, the type of qualified IDR items or services (such as emergency services, post-stabilization services, professional services, hospital-based services), corresponding service and place-of-service codes, the amount of cost sharing allowed and the amount of the initial payment made by the plan or issuer for the qualified IDR items or services, if applicable; (2) the names and contact information of the parties involved, including email addresses, phone numbers, and mailing addresses; (3) the state where the qualified IDR items or services were furnished; (4) the commencement date of the open negotiation period; (5) the initiating party’s preferred certified IDR entity; (6) an attestation that the items or services are qualified IDR items and services within the scope of the Federal IDR process; (7) the QPA; (8) information about the QPA as described in 26 CFR 54.9816-6T(d), 29 CFR 2590.716-6(d), and 45 CFR 149.140(d); and (9) general information describing the Federal IDR process. This general information will help ensure that the non-initiating party is informed about the process and is familiar with the next steps. Such general information should include a description of the scope of the Federal IDR process and key deadlines in the Federal IDR process, including the dates to initiate the Federal IDR process, how to select a certified IDR entity, and the process for selecting an offer. The Departments have developed a form that parties must use to satisfy this requirement October 18, 2021 to provide general information describing the Federal IDR process. As with the open negotiation notice, the initiating party may provide the Notice of IDR Initiation to the opposing party electronically (such as by email) if the following two conditions are satisfied: (1) the initiating party has a good faith belief that the electronic method is readily accessible by the other party; and (2) the notice is provided in paper form free of charge upon request. In addition to furnishing notice to the non-initiating party, the initiating party must also furnish the Notice of IDR Initiation to the Departments on the same day the notice is furnished to the non-initiating party. The initiating party must provide its Notice of IDR Initiation through the Departments’ Federal IDR portal. Moreover, IDR entities, certified IDR entities and disputing parties will be required to use the Federal IDR portal to perform certain functions related to the Federal IDR process. The Federal IDR portal will be used to facilitate and support IDR entity certification, the initiation of the Federal IDR process, the selection of certified IDR entities, the submission of supporting documentation to certified IDR entities, and the submission of certified IDR entity reporting metrics, as required by these interim final rules. Under Code section 9816(c)(1)(B), ERISA section 716(c)(1)(B), and PHS Act section 2799A-1(c)(1)(B), the date of initiation of the Federal IDR process will be the date of the submission or such other date specified by the Departments that is not later than the date of receipt of the Notice of IDR Initiation by both the other party and the Departments. Consistent with the flexibility provided by the statute to specify an alternate date of initiation, these interim final rules specify that the initiation date of the Federal IDR process is the date of receipt of the Notice of IDR Initiation by the Departments. As noted, since the Departments will monitor the Federal IDR portal, submitting the Notice of IDR Initiation through the Federal IDR portal will provide a clear date on which the Notice of IDR Initiation has been received by the Departments. This approach will better enable the Departments to meet the statutory requirement to select a certified IDR entity within 6 484 business days of the initiation of the IDR process in instances in which the parties have not jointly selected a certified IDR entity. The Departments will acknowledge and confirm the initiation date with both parties upon receipt of the Notice of IDR Initiation. Given that the Departments expect most of these notices to be provided electronically, and that the parties will have been in continuous contact by this point in the process (through the submission of the initial bill, the remittance of the initial payment of the claim or notice of denial of payment, the submission of the open negotiation notice, and negotiations during the open negotiation period), the Departments expect minimal delay between when the Departments are notified through the portal and when the opposing party is notified (either by the initiating party or the Departments). The Departments solicit comment on both the content of the Notice of IDR Initiation as well as the manner for providing the notices as set forth under these interim final rules. D. Federal IDR Process Following Initiation 1. Selection of Certified IDR Entity Under Code section 9816(c)(4)(F), ERISA section 716(c)(4)(F), and PHS Act section 2799A-1(c)(4)(F), the plan or issuer and the nonparticipating provider, nonparticipating emergency facility, or nonparticipating provider of air ambulance services (as applicable) that are parties to the Federal IDR process may jointly select a certified IDR entity no later than 3 business days following the date of the IDR initiation. As stated above, in initiating the Federal IDR process, the initiating party will indicate its preferred certified IDR entity in the Notice of IDR Initiation. Under these interim final rules, the party in receipt of the Notice of IDR Initiation may agree or object to the selection of the preferred certified IDR entity identified in the Notice of IDR Initiation. If the non-initiating party in receipt of the Notice of IDR Initiation fails to object within 3 business days of the date of initiation of the Federal IDR process, the preferred certified IDR entity identified in the Notice of IDR Initiation will be the Bulletin No. 2021–42 selected certified IDR entity, provided that the certified IDR entity does not have a conflict of interest. If the party in receipt of the Notice of IDR Initiation timely objects, that party must timely notify the initiating party of the objection, including an explanation of the reason for objecting, and propose an alternative certified IDR entity. The initiating party must then agree or object to the alternative certified IDR entity. In order to jointly select a certified IDR entity, the plan or issuer and the nonparticipating provider, nonparticipating emergency facility, or nonparticipating provider of air ambulance services must agree on a certified IDR entity not later than 3 business days after the date of initiation of the Federal IDR process. Due to the short timeframe for this selection, the Departments anticipate that communication between the parties regarding certified IDR entity selection will typically be conducted through electronic mail to the email addresses used to send and receive the Notice of IDR Initiation. The Departments anticipate that most users of the Federal IDR process will be providers, facilities, providers of air ambulance services, plans, and issuers, which are likely to use electronic communications regularly. If both parties agree on and select a certified IDR entity, or fail to agree upon a certified IDR entity within the specified timeframe, the initiating party must notify the Departments by electronically submitting the notice of the certified IDR entity selection or failure to select (as applicable), no later than 1 business day after the end of the 3-business-day period (or in other words, 4 business days after the date of initiation of the Federal IDR process) through the Federal IDR portal. In addition, in instances where the non-initiating party believes that the Federal IDR process is not applicable, the non-initiating party must notify the Departments through the Federal IDR portal within the same timeframe that the notice of selection (or failure to select) is required and provide information regarding the lack of applicability. Based upon this information and any additional information requested by the selected certified IDR entity, the selected certified IDR entity will determine whether the Federal IDR process is 24 applicable. The Departments seek comment on this approach and whether any challenges exist in relying solely upon electronic notifications. The Departments will make available on the Federal IDR portal a list of certified IDR entities among which parties to the Federal IDR process may select, including basic information about the certified IDR entities, such as contact information, certified IDR entity numbers (unique identification numbers assigned to each certified IDR entity by the Departments), websites, and service areas. The Departments seek comment on this approach, including whether additional information about the certified IDR entities should be made public, and whether any challenges exist in relying solely upon electronic notifications. Under these interim final rules, the selected certified IDR entity must not have a conflict of interest as defined in 26 CFR 54.9816-8T(a)(2), 29 CFR 2590.7168(a)(2), and 45 CFR 149.510(a)(2). The selected certified IDR entity must also ensure that assignment of personnel to the dispute and decisions regarding hiring, compensation, termination, promotion, or other similar matters related to personnel assigned to the dispute are not made based upon the likelihood that the assigned personnel will support a particular party or type of party (that is, provider, facility, provider of air ambulance services, plan, or issuer) to the determination being disputed other than as outlined under 26 CFR 54.9816-8T(c)(4)(iii), 29 CFR 2590.7168(c)(4)(iii), and 45 CFR 149.510(c)(4) (iii). Also, as agents of the certified IDR entity, personnel responsible for handling individual payment determinations must comply with the certification requirements of these interim final rules as set forth by their principal, the certified IDR entity, in its procedures. Therefore, the personnel assigned to disputes by the certified IDR entity must not have a conflict of interest, as defined by 26 CFR 54.9816-8T(a)(2), 29 CFR 2590.716-8(a)(2), and 45 CFR 149.510(a)(2). In addition, any personnel assigned to the matter must not have been a party to the determination being disputed or an employee or agent of such a party within the 1 year immediately pre- ceding the dispute resolution assignment, similar to the “revolving door” laws24 laid out in 18 U.S.C. 207(b), 207(c), and 207(e). Under 18 U.S.C. 207(b), 207(c), and 207(e), former officers or employees of the executive branch, including independent agencies, are prohibited from aiding or advising on matters with which they were involved while in the executive branch for 1 year. These interim final rules adopt the same 1-year timeframe by prohibiting former employees’ or agents’ involvement in dispute resolution processes involving former employers for 1 year. The Departments are of the view that this approach provides a reasonable and appropriate standard for preventing conflicts of interest. Although 18 U.S.C. 207(b), 207(c), and 207(e) are typically used in reference to trade or treaty negotiations, the 1-year prohibition is also a standard applied generally to employees of the executive and legislative branches and independent agencies. These statutes represent conflict-of-interest standards that the Departments view as reasonable and appropriate for developing standards for preventing conflicts of interest involving certified IDR entities that are resolving disputes in the Federal IDR process. Certified IDR e [Text truncated at 120,000 characters. The full text is on the page linked above.] --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/agency%3Airs%3A45404747f8b4e7b2. Public record. Not legal advice.