To help curb surprise medical bills, the No Surprises Act has extensive provisions addressing the underlying causes of surprise billings. Inaccurate provider directory information often leads patients to use out-of-network providers inadvertently, which is a leading cause of surprise medical billing. To help prevent that, the No Surprises Act has placed obligations on providers and health plans to ensure that their provider directory is accurate and updated frequently.
Mandating providers and health plans to provide accurate information regarding the providers under their network is vital. People look at health plans’ provider directories to view the providers under their network when purchasing health insurance. Individuals also depend on them to find providers under their insurance network.
By stipulating provider directory requirements, the No Surprise Act seeks to protect patients who rely on inaccurate information on the provider directory from any surprise out-of-network billing.
What is the provider directory in The No Surprises Act?
Health plans maintain a provider directory that contains a list of their in-network providers. However, unlike Medicaid, Medicare, and qualified health plans (QHPs) with rules regulating verification of the accuracy of the entries, there was no general guideline regulating individual health plans. To fix this, Congress passed the Consolidated Appropriations Act in 2021, known as the No Surprises Act.
The No Surprises Act shields people covered under individual and group health plans from receiving surprise billing by requiring all providers and health plans to maintain an up-to-date provider directory, among other things.
Incorrect provider directories drive surprise bills for patients
Patients rely on directories to find in-network providers or determine if a particular provider is in a plan’s network. Erroneous information in the directories often leads to delays in getting care, frustration, inability to access a participating provider that has available appointments, and accidental use of an out-of-network provider.
A study published by Health Affairs shows that incorrect provider directories are a major cause of out-of-network surprise bills. In the study, out of 44% of patients that used a mental health provider directory, 53% experienced inaccuracies. Patients who faced the inaccuracies were more likely to use an out-of-network provider and four times more likely to receive a surprise bill. Also, provider directory inaccuracy is massively underreported. About two-thirds of patients surveyed who experienced it did not report it.
Do all providers and facilities need to submit to the directory?
Yes. The No Surprises Act doesn’t exempt any category of healthcare providers or facilities from its application. All providers and facilities must comply with the provider directory requirement.
No Surprises Act provider directory requirements
The No Surprises Act takes steps to protect patients from any excess bills they incur from using an out-of-network provider because they relied on inaccurate information on the provider directory.
Directory requirements for providers
Providers are a cardinal part of the healthcare system and so have a role to play in maintaining accurate provider directories. Providers under the No Surprises Act have the following responsibilities:
Refund excess billing
If patients pay an amount that is more than the in-network cost, the provider and healthcare facilities must refund the patient any amount that is above the network cost-sharing amount with interest.
If you are a provider or healthcare facility, the law obligates you to establish processes to submit accurate information at particular times. This is to help health plans and issuers to maintain accurate and up-to-date provider directories.
Include provider directory requirements in provider contracts
The No Surprises Act allows providers to require that certain terms are included in their contracts with health plans or issuers. If you are a provider or a health facility, you can include as part of your contract terms a provision that will compel plans and issuers to remove you from their directory once your contract with them is terminated.
Providers can also include in their contract that plans and insurance issuers bear any financial responsibility for providing inaccurate information in the provider directory.
Establish business processes to support accurate directory information
Providers and healthcare facilities must develop business processes that will help ensure that the provider directory is always accurate. At the minimum, providers and facilities must furnish health plans and insurers with provider directory information at different times, including:
- At the beginning of a network agreement for a particular coverage with the plan or issuer
- When they terminate a network agreement for a particular coverage with the health plan or issuer
- When there is a substantial change to the content of the provider directory information of the provider or facility
- If the plan or insurer request
- Any other time the provider, facility, or The U.S. Department of Health and Human Services deems appropriate
The No Surprises Act mandates providers and facilities to have these business processes in place by Jan. 1, 2022.
Requirements for health plans
Health plans and issuers have their fair share of obligations toward keeping provider directories updated. So, they need to acquaint themselves with the demand of the No Surprises Act, especially the 90 days rule.
The No Surprises Act 90 days rule refers to the requirement that health plans must verify and update provider directory information at least once every 90 days. If you are a health plan, you must verify every provider or facility in your directory.
In addition, you must develop processes for removing unverified providers from the directory, including updating provider directory information within two business days after you receive an update.
Health plans must also attend to patients’ requests to know the status of a provider within a business day and keep a record of the communication for at least two years.
The provider director must be available on health plans’ websites and contain the following information about the individual providers under the plan’s network:
- Name of the provider
- Phone number
- Digital contact information
The provider directory should also contain each clinic, healthcare facility, or medical group’s name, address, telephone number, and digital contact information.
Printed provider directories must also clearly state the date it was printed, including a statement verifying the directory’s current version at the time it was printed. In addition, there should be a statement directing people to view the current version of the directory on the plan’s website.
Refund and cost-sharing process for billings relating to inaccurate directory information
Patients rely on health plans’ provider directories when they need to locate a provider under their plan’s network. If the information in the provider directory is inaccurate, a patient may experience delays in accessing care, among other frustrations.
In some situations, a patient may end up using an out-of-network provider or facility unknowingly, which will often result in surprise medical bills. In-network providers usually charge less than out-of-network providers, and most health plans that provide out-of-network coverage will only cover the cost an in-network provider would have charged, leaving the patient to cover the rest.
The No Surprises Act addresses this issue by providing for refund and cost-sharing processes for bills from out-of-network providers due to reliance on inaccurate directory information.
According to the law, the plan or issuer must limit cost-sharing to terms that would have applied if an in-network provider supplied the service or items. Plans and issuers must apply deductible and out-of-pocket maximums the way they would for an in-network provider.
The No Surprises Act prohibits providers and health facilities from billing more than their in-network cost-sharing to individuals under this circumstance.
If a patient relies on incorrect provider directory information and incurs an expense more than the in-network cost, they are entitled to a refund. The law states that providers who have received payment for their services or items in excess of what the patient would have paid in their in-network cost-sharing must refund the patient, plus interest.
The Secretary of HHS will determine what will be the applicable interest rate. Note that this provision went into effect on Jan. 1, 2022.
Penalties for not complying with the No Surprises Act provider directory
Providers and health plans who fail to comply with the various provider directory requirements under the No Surprises Act may face heavy penalties.
Providers who neglect to comply with the provisions of the law could receive a penalty of up to $10,000 per violation. On the other hand, health plans could be fined up to $100 per day per individual affected by a violation.
Providers and payers must collaborate to comply with the No Surprises Act provider directory requirements
The provider directory requirements may be one of the less-known provisions of the No Surprises Act, but they are just as important. Complying with the requirements is relatively straightforward, and it would go a long way in making access to affordable care easier and reducing surprise medical billing occurrences.
Providers and health plans should work together to develop processes to keep provider directories up-to-date and error-free. Effective communication will help providers and health plans perform their obligations under the law.