OIC's Implementation of the Federal No Surprises Act

ICE OF if HE CODE REVISER

ST AH OF WASHINGTON

FILED

DATE: November 01,. 2021

TIME: 7:38 AM

WSR 21-22-073

MIKE KREIDLER

Phone: 360-725-7000

STATE OF WASHINGTON

STATE INSURANCE COMMISSIONER

www.insurance.wa.gov

OFF

OFFICE OF

INSURANCE COMMISSIONER

Technical Assistance Advisory 2021-051

TO:

Health Carriers

FROM:

Insurance Commissioner Mike Kreidler

DATE:

November 1, 2021

SUBJECT:

OIC’s Implementation of the Federal No Surprises Act

The purpose of this Technical Assistance Advisory (“TAA”) is to provide guidance for health

carriers2 on the Office of Insurance Commissioner (“OIC”)’s implementation of the Federal No

Surprises Act.3

Background

Washington’s Balance Billing Protection Act (“BBPA”) bans balance billing for emergency services

provided by an out-of-network (“OON”) hospital or provider, and surgical and ancillary

nonemergency services provided by an OON provider at in-network hospitals or ambulatory surgical

facilities.4 Balance billing refers to the practice of OON providers or facilities billing enrollees5 for

health care services provided to the enrollee after the provider or facility’s billed amount is not fully

reimbursed by the health carrier, exclusive of permitted enrollee cost-sharing.6 The BBPA requires

that the OON provider and health carrier negotiate OON payments in good faith without involving

the enrollee.7 Under the BBPA, the enrollee is only responsible for in-network cost-sharing, which

must be applied toward the enrollee’s deductible and maximum out-of-pocket payment obligation.8

Congress recently passed the Federal No Surprises Act (“FNSA”), which also bans balance billing,

but applies to a broader scope of plans and services than Washington’s BBPA

good faith without involving

the enrollee.7 Under the BBPA, the enrollee is only responsible for in-network cost-sharing, which

must be applied toward the enrollee’s deductible and maximum out-of-pocket payment obligation.8

Congress recently passed the Federal No Surprises Act (“FNSA”), which also bans balance billing,

but applies to a broader scope of plans and services than Washington’s BBPA. This new law, enacted

as part of the broader Consolidated Appropriations Act of 2021, takes effect for health plans,

1 This advisory is a policy statement released to advise the public of OIC’s current opinions, approaches, and

likely courses of action. It is advisory only. RCW 34.05.230(1).

2 See RCW 48.43.005(28) (defining “health carrier”).

3 See Consolidated Appropriations Act (“CAA”), 2021, Pub. L. No. 116-260, 134 Stat. 1182 (2020) (enacting

several new laws, including the No Surprises Act at div. BB, tit. I, 134 Stat. at 2757-2890).

4 RCW 48.49.020(1).

5 For ease of reading, “enrollee” includes plan participant and beneficiary.

6 See RCW 48.43.005(5) (defining “balance bill”); see also Requirements Related to Surprise Billing; Part I,

86 Fed. Reg. 36,872, 36,873 (Sept. 13, 2021) (defining “balance billing”).

7 RCW 48.49.030(2).

8 See RCW 48.43.005(18) (defining “cost sharing”); RCW 48.49.003(2)(b); RCW 48.49.030.

Mailing Address: PO Box 40255 Olympia, WA 98504-0255

Street Address: 5000 Capitol Blvd Tumwater WA 98501

See RCW 48.43.005(5) (defining “balance bill”); see also Requirements Related to Surprise Billing; Part I,

86 Fed. Reg. 36,872, 36,873 (Sept. 13, 2021) (defining “balance billing”).

7 RCW 48.49.030(2).

8 See RCW 48.43.005(18) (defining “cost sharing”); RCW 48.49.003(2)(b); RCW 48.49.030.

Mailing Address: PO Box 40255 Olympia, WA 98504-0255

Street Address: 5000 Capitol Blvd Tumwater WA 98501

OFFICE OF THE INSURANCE COMMISSIONER

Technical Assistance Advisory 2021-05

Federal No Surprises Act

November 1, 2021

Page 2

beginning on or after January 1, 2022.9 It applies to nearly all private health plans offered by

employers (including grandfathered health plans and the Federal Employees Health Benefits

Program), as well as individual health insurance policies offered both on and off the Exchange.10 In

addition to prohibiting balance billing for emergency services, the FNSA extends balance billing

protections to post-stabilization services,11 nonemergency services furnished by OON providers at

in-network facilities without the enrollee’s informed consent,12 and services furnished by air

ambulance providers.13

Beyond banning balance bills by OON providers and facilities, the FNSA limits enrollee cost-sharing

an enrollee must pay the issuer.14 Enrollees who receive OON care will only have to pay the

cost-sharing amount that they would have paid if the provider had been in-network.15 This limitation

applies to emergency services, nonemergency services without the patient’s informed consent, and

air ambulance services.16 It similarly limits cost-sharing when an enrollee relied on their issuer’s

provider directory’s listing of a provider as in-network, and tha

care will only have to pay the

cost-sharing amount that they would have paid if the provider had been in-network.15 This limitation

applies to emergency services, nonemergency services without the patient’s informed consent, and

air ambulance services.16 It similarly limits cost-sharing when an enrollee relied on their issuer’s

provider directory’s listing of a provider as in-network, and that information turned out to be

incorrect.17 Any cost-sharing subject to the FNSA must be counted towards an enrollee’s in-network

deductible and annual out-of-pocket maximum.18

Additionally, Congress set up a regulatory framework for OON provider payment and dispute

resolution, and added transparency measures, provider directory requirements, and continuity of care

requirements.

OIC Enforcement

Aside from a few deferments described in the next section, OIC will enforce the FNSA provisions

pertaining to health carriers for health plans starting on or after January 1, 2022.19 This includes the

following provisions of FNSA:

• Prohibition on balance billing for emergency services and nonemergency services under

FNSA that are broader than the BBPA’s scope of services protected from balance billing,

including post-stabilization care.20

9 See CAA, 2021, Pub. L. No. 116-260, div. BB, tit. 1 (No Surprises Act), sec. 102, 134 Stat. 1182, 2758-2797

(2020); 86 Fed. Reg. at 36,877.

10 Id.

11 86 Fed. Reg. at 36,880.

12 Id. at 36,882; section 102 of the No Surprises Act.

13 See section 105 of the No Surprises Act; 86 Fed. Reg. at 36,876.

14 See section 102 of the No Surprises Act. For ease of reading, “issuers” in reference to the FNSA includes

group health plans, health insurance issuers, and Federal Employees Health Benefits Program carriers.

15 Id.

16 See sections 102 and 105 of the No Surprises Act; 86 Fed. Reg. at 36,883.

17 See section 116(b) of the No Surprises Act.

18 See 86 Fed. Reg. at 36,877

6 Fed. Reg. at 36,876.

14 See section 102 of the No Surprises Act. For ease of reading, “issuers” in reference to the FNSA includes

group health plans, health insurance issuers, and Federal Employees Health Benefits Program carriers.

15 Id.

16 See sections 102 and 105 of the No Surprises Act; 86 Fed. Reg. at 36,883.

17 See section 116(b) of the No Surprises Act.

18 See 86 Fed. Reg. at 36,877.

19 See WAC 284-43-0140 (“Health carriers shall comply with all Washington state and federal laws relating

to the acts and practices of carriers and laws relating to health plan benefits.”)

20 See, e.g., 86 Fed. Reg. at 36,880.

OFFICE OF THE INSURANCE COMMISSIONER

Technical Assistance Advisory 2021-05

Federal No Surprises Act

November 1, 2021

Page 3

• Prohibition on balance billing for grandfathered health plans.21

• Requirements for in-network cost-sharing for enrollees that relied on an issuer’s databases,

response protocols, or provider directory representations that a provider was in-network.22

• Prohibition on balance billing for “continuing care patients” for 90 days after a provider

becomes OON.23

• Providing methods for calculating enrollee cost-sharing and provider payments, and dispute

resolution, for: (1) plans subject to OIC jurisdiction but not the BBPA, e.g., grandfathered

health plans; and (2) services subject to the FNSA but not the BBPA, e.g., nonemergency

services provided by neonatologists and intensivists.24

• Requirements for external review to determine whether balance billing protections are

applicable when there is an adverse determination by an issuer.25

The FNSA preempts state laws only when those laws impose a requirement that “prevents t

dfathered

health plans; and (2) services subject to the FNSA but not the BBPA, e.g., nonemergency

services provided by neonatologists and intensivists.24

• Requirements for external review to determine whether balance billing protections are

applicable when there is an adverse determination by an issuer.25

The FNSA preempts state laws only when those laws impose a requirement that “prevents the

application” of the FNSA.26 Based upon this principle and a few FNSA provisions expressly deferring

to state law, OIC will continue to enforce related state laws in four areas: (1) BBPA provisions that

exceed FNSA provisions;27 (2) provider directories;28 (3) calculation of enrollee cost-sharing;29 and

(4) OON provider payment and dispute resolution processes.30

As a result, beginning January 1, 2022, until the effective date of any new legislation amending the

BBPA, OIC will enforce the following state law provisions:

• Requirements on providers or insurers that go beyond what is required under the new federal

law, including:

o Prohibitions on asking an enrollee to waive their rights.31

21 Id. at 36,877.

22 See section 116(b) of the No Surprises Act.

23 See section 113 of the No Surprises Act.

24 See section 103 of the No Surprises Act; 86 Fed. Reg. at 36,886-7; Interim Final Rules, Requirements Related

to

Surprise

Billing;

Part

II

(proposed

Sept.

30,

2021),

available

at:

https://www.cms.gov/files/document/cms-9908-ifc-surprise-billing-part-2.pdf (implementing independent

dispute resolution provisions); see also RCW 48.43.005(44) and WAC 284-43B-010(2)(l) (defining

“surgical or ancillary services,” which are granted balance billing protection under RCW 48.49.020(1)).

25 See section 110 of the No Surprises Act.

26 See 42 U.S.C. § 300gg-23(a)(1); 86 Fed. Reg. at 36,886.

27 Id.

28 See section 116(a) of the No Surprises Act (deferring to state laws relating to provider directories).

29 86 Fed. Reg. at 36,885.

30 Id.

31 RCW 48.49.030(1), (5).

) (defining

“surgical or ancillary services,” which are granted balance billing protection under RCW 48.49.020(1)).

25 See section 110 of the No Surprises Act.

26 See 42 U.S.C. § 300gg-23(a)(1); 86 Fed. Reg. at 36,886.

27 Id.

28 See section 116(a) of the No Surprises Act (deferring to state laws relating to provider directories).

29 86 Fed. Reg. at 36,885.

30 Id.

31 RCW 48.49.030(1), (5).

OFFICE OF THE INSURANCE COMMISSIONER

Technical Assistance Advisory 2021-05

Federal No Surprises Act

November 1, 2021

Page 4

o Requirement that a health carrier must indicate in the Health Insurance Portability and

Accountability Act (“HIPAA”) standard 271 transaction whether an enrollee’s health plan

is subject to the BBPA.32

o Requirement that a health carrier must indicate in the HIPAA standard 835 transaction

whether a claim was processed in accordance with the BBPA.33

• Requirements for provider directories.34

• BBPA’s methods for calculating enrollee cost-sharing and OON provider payments, and

dispute resolution.35

Deferred Enforcement

OIC will defer enforcement against some entities due to jurisdictional limitations, and with respect

to some provisions of FNSA in alignment with deferment recently announced by the Departments of

Health and Human Services, Labor, and Treasury (collectively referred to as “the Departments”)

ulating enrollee cost-sharing and OON provider payments, and

dispute resolution.35

Deferred Enforcement

OIC will defer enforcement against some entities due to jurisdictional limitations, and with respect

to some provisions of FNSA in alignment with deferment recently announced by the Departments of

Health and Human Services, Labor, and Treasury (collectively referred to as “the Departments”).

Due to jurisdiction limitations, OIC will defer to other state or federal agencies for enforcement

regarding the following entities:

• Air ambulances;36

• Self-funded group health plans that have not elected to participate in the BBPA; and

• Health providers and facilities.37

Additionally, OIC will defer enforcement for some of the FNSA provisions in accordance with the

deferred enforcement policy announced by the Departments, Aug. 20, 2021, in a set of Frequently

Asked Questions (“FAQs”).38 In accordance with these FAQs, OIC will defer enforcement for the

following FNSA provisions:

32 WAC 284-43B-040(1)(a).

33 WAC 284-43B-040(1)(b).

34 See WAC 284-170-260; RCW 48.49.090(1); RCW 48.49.070(3); RCW 48.49.080(3).

35 RCW 48.49.030; RCW 48.49.040; WAC 284-43B-020; WAC 284-43B-030; WAC 284-43B-035.

36 See 86 Fed. Reg. at 36,885.

37 Pursuant RCW 48.49.100, OIC will continue to give providers and facilities an opportunity to cure violations

of RCW 48.49.020 or 48.49.030.

38 See “FAQs About Affordable Care Act and Consolidated Appropriations Act, 2021 Implementation Part 49

(“FAQs”),” Aug. 20, 2021, available at: https://www.hhs.gov/guidance/sites/default/files/hhs-guidance­

documents/FAQs%20About%20ACA%20%26%20CAA%20Implementation%20Part%2049_MM%20508

_08-20-21.pdf. Additionally, the Departments announced deferment of a few non-FNSA provisions, namely

the requirement that issuers publish machine-readable files relating to prescription drug pricing. Id. at 1

(citing 85 Fed. Reg. 72,158 (Nov. 12, 2020); 26 C.F.R. § 54.9815-2715A3(b)(1)(iii), 29 C.F.R. § 2590.715­

2715A3(b)(1)(iii), and 45 C.F.R

20%26%20CAA%20Implementation%20Part%2049_MM%20508

_08-20-21.pdf. Additionally, the Departments announced deferment of a few non-FNSA provisions, namely

the requirement that issuers publish machine-readable files relating to prescription drug pricing. Id. at 1

(citing 85 Fed. Reg. 72,158 (Nov. 12, 2020); 26 C.F.R. § 54.9815-2715A3(b)(1)(iii), 29 C.F.R. § 2590.715­

2715A3(b)(1)(iii), and 45 C.F.R. § 147.212(b)(1)(iii)). Deferment will be until regulations to fully implement

OFFICE OF THE INSURANCE COMMISSIONER

Technical Assistance Advisory 2021-05

Federal No Surprises Act

November 1, 2021

Page 5

• Requirements for making available a price comparison tool (by internet website, in paper

form, or telephone). Deferment will be up until plan years (in the individual market, policy

years) beginning on or after January 1, 2023.39

• Requirements for providing an Advanced Explanation of Benefits.40 Deferment will be until

regulations fully implementing this requirement are adopted and applicable.41

OIC will continue to enforce any state law counterpart to these FNSA provisions, including, but not

limited to the following:

• Requirements for transparency tools for price and quality information.42

• Requirements for enrollee notification upon termination of a provider by a health carrier.43

The Departments also detailed provisions of the FNSA44 that issuers must implement using a good

faith, reasonable interpretation of the law, without the guidance of regulations

ns, including, but not

limited to the following:

• Requirements for transparency tools for price and quality information.42

• Requirements for enrollee notification upon termination of a provider by a health carrier.43

The Departments also detailed provisions of the FNSA44 that issuers must implement using a good

faith, reasonable interpretation of the law, without the guidance of regulations. OIC will enforce the

following provisions in the same manner as announced by the Departments:

• Requirements to include on any insurance identification card issued to enrollees, any

applicable deductibles, any applicable out-of-pocket maximum limitations, and a telephone

number and website address for individuals to seek assistance.45

• Requirements to establish a process to update and verify the accuracy of provider directory

information and to establish a protocol for responding to requests by telephone and electronic

communication from an enrollee about a provider’s network participation status.46

this requirement are adopted and applicable. Id. at 1-2 (describing deferment). The Departments will defer

enforcement of the requirement to publish the remaining machine-readable files until July 1, 2022. Id. at 2.

OIC will similarly defer enforcement.

39 Id. at 3-4 (citing Internal Revenue Code (“Code”) § 9819, Employee Retirement Income Security Act

(“ERISA”) § 719, and Public Health Service (“PHS”) Act § 2799A-4, as added by section 114 of the No

Surprises Act).

40 Id. at 6 (citing Code § 9816(f), ERISA § 716(f), and PHS Act § 2799A-1(f), as added by section 111 of the

No Surprises Act).

41 Id. at 7 (describing deferment).

42 See RCW 48.43.007.

43 WAC 284-170-421(10).

44 Additionally, the Departments detailed a few non-FNSA provisions it will expect issuers to implement using

a good faith, reasonable interpretation of the law, including requirements prohibiting gag clauses

§ 9816(f), ERISA § 716(f), and PHS Act § 2799A-1(f), as added by section 111 of the

No Surprises Act).

41 Id. at 7 (describing deferment).

42 See RCW 48.43.007.

43 WAC 284-170-421(10).

44 Additionally, the Departments detailed a few non-FNSA provisions it will expect issuers to implement using

a good faith, reasonable interpretation of the law, including requirements prohibiting gag clauses. See FAQs

at 7 (citing Code § 9824, ERISA § 724, and PHS Act § 2799A-9, as added by section 201 of division BB,

title II, of CAA). OIC will enforce these provisions in the same manner as the Departments.

45 Id. at 4-5 (citing Code § 9816(e), ERISA § 716(e), and PHS Act § 2799A–1(e), as added by section 107 of

the No Surprises Act).

46 Id. at 7-8 (citing Code § 9820(a) and (b), ERISA § 720(a) and (b), and PHS Act § 2799A-5(a) and (b), as

added by section 116(a) of the No Surprises Act). However, given the deferment to state law in section

OFFICE OF THE INSURANCE COMMISSIONER

Technical Assistance Advisory 2021-05

Federal No Surprises Act

November 1, 2021

Page 6

• Prohibition on cost-sharing when an enrollee relied on the issuer’s provider directory or

response protocol.47

• Requirements to make certain disclosures regarding balance billing protections to enrollees.48

• Requirements to apply continuity of care protections.49

Consumer Notice

OIC developed a consumer notice for balance billing rights that satisfies both the FNSA and the

BBPA.50 OIC’s consumer notice should be used for fully insured health plans, PEBB/SEBB plans,

and self-funded ERISA plans that have opted into the BBPA

certain disclosures regarding balance billing protections to enrollees.48

• Requirements to apply continuity of care protections.49

Consumer Notice

OIC developed a consumer notice for balance billing rights that satisfies both the FNSA and the

BBPA.50 OIC’s consumer notice should be used for fully insured health plans, PEBB/SEBB plans,

and self-funded ERISA plans that have opted into the BBPA. Under the BBPA, this notice must be

provided to enrollees in any communication that authorizes nonemergency surgical or ancillary

services at an in-network facility.51 Also, the issuer must indicate on the enrollee’s explanation of

benefits whether the service is subject to balance billing protections.52 OIC will continue to enforce

these BBPA consumer notice requirements against health carriers.

Please direct any questions about this advisory to Jane Beyer, Senior Health Policy Advisor, who

may be contacted at janeb@oic.wa.gov and phone number 360-725-7043.

116(a) of the No Surprises Act, OIC will only enforce these FNSA provisions against health carriers for

plans and services not subject to the BBPA but subject to OIC’s jurisdiction, e.g., grandfathered health plans.

47 Id.

48 Id. at 8-9 (citing Code § 9820(c), ERISA § 720(c), and PHS Act § 2799A-5(c), as added by section 116(c)

of the No Surprises Act).

49 Id. at 9 (citing Code § 9818, ERISA § 718, and PHS Act § 2799A-3 and 2799B-8, as added by section 113

of the No Surprises Act).

50 https://www.insurance.wa.gov/surprise-billing-and-balance-billing-protection-act; see also Code § 9820(c),

ERISA § 720(c), and PHS Act § 2799A-5(c), as added by section 116(c) of the No Surprises Act.

51 See WAC 284-43B-050(2)(a)(i).

52 See WAC 284-43B-050(4)(a).