Requirements Related to Surprise Billing; Part I

Citation86 FR 36872
Record Number2021-14379
Published date13 July 2021
SectionRules and Regulations
CourtEmployee Benefits Security Administration,Personnel Management Office
Federal Register, Volume 86 Issue 131 (Tuesday, July 13, 2021)
[Federal Register Volume 86, Number 131 (Tuesday, July 13, 2021)]
                [Rules and Regulations]
                [Pages 36872-36985]
                From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
                [FR Doc No: 2021-14379]
                Federal Register / Vol. 86 , No. 131 / Tuesday, July 13, 2021 / Rules
                and Regulations
                [[Page 36872]]
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                OFFICE OF PERSONNEL MANAGEMENT
                5 CFR Part 890
                RIN 3206-AO30
                DEPARTMENT OF THE TREASURY
                Internal Revenue Service
                26 CFR Part 54
                [TD9951]
                RIN 1545-BQ04
                DEPARTMENT OF LABOR
                Employee Benefits Security Administration
                29 CFR Part 2590
                RIN 1210-AB99
                DEPARTMENT OF HEALTH AND HUMAN SERVICES
                45 CFR Parts 144, 147, 149, and 156
                [CMS-9909-IFC]
                RIN 0938-AU63
                Requirements Related to Surprise Billing; Part I
                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.
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                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
                amend and add provisions to existing rules under the Internal Revenue
                Code, the Employee Retirement Income Security Act, the Public Health
                Service Act, and the Federal Employees Health Benefits Act. These
                interim final rules implement provisions of the No Surprises Act that
                protect participants, beneficiaries, and enrollees in group health
                plans and group and individual health insurance coverage from surprise
                medical bills when they receive emergency services, non-emergency
                services from nonparticipating providers at participating facilities,
                and air ambulance services from nonparticipating providers of air
                ambulance services, under certain circumstances. In this rulemaking,
                the Department of Health and Human Services (HHS), the Department of
                Labor (DOL), and the Department of the Treasury (collectively, the
                Departments) are issuing interim final rules with largely parallel
                provisions that apply to group health plans and health insurance
                issuers offering group or individual health insurance coverage. HHS is
                also issuing in this rulemaking additional interim final rules that
                apply to emergency departments of hospitals and independent
                freestanding emergency departments, health care providers and
                facilities, and providers of air ambulance services related to the
                protections against surprise billing. The Office of Personnel
                Management (OPM) is issuing in this rulemaking interim final rules that
                specify how certain provisions of the No Surprises Act apply to health
                benefits plans offered by carriers under the Federal Employees Health
                Benefits Act (FEHBA).
                DATES: Effective date: These regulations are effective on September 13,
                2021.
                 Applicability date: The regulations are generally applicable for
                plan years (in the individual market, policy years) beginning on or
                after January 1, 2022. The HHS-only regulations that apply to health
                care providers, facilities, and providers of air ambulance services are
                applicable beginning on January 1, 2022. The OPM-only regulations that
                apply to health benefits plans are applicable to contract years
                beginning on or after January 1, 2022.
                 Comment date: To be assured consideration, comments must be
                received at one of the addresses provided below, no later than 5 p.m.
                on September 7, 2021.
                ADDRESSES: Written comments may be submitted to the addresses specified
                below. Any comment that is submitted will be shared among the
                Departments and OPM. 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 information) 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 CMS-9909-IFC. 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 three ways (please choose only one of the ways
                listed):
                 1. Electronically. You may submit electronic comments on this
                regulation at https://www.regulations.gov by entering the file code in
                the search window and then clicking on ``Comment''.
                 2. By regular mail. You may mail written comments to the following
                address ONLY: Centers for Medicare & Medicaid Services, Department of
                Health and Human Services, Attention: CMS-9909-IFC, P.O. Box 8016,
                Baltimore, MD 21244-8016.
                 Please allow sufficient time for mailed comments to be received
                before the close of the comment period.
                 3. By express or overnight mail. You may send written comments to
                the following address ONLY: Centers for Medicare & Medicaid Services,
                Department of Health and Human Services, Attention: CMS-9909-IFC, Mail
                Stop C4-26-05, 7500 Security Boulevard, Baltimore, MD 21244-1850.
                 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 202-606-4056; Kari DiCecco, Internal Revenue
                Service, Department of the Treasury, at 202-317-5500; Matt Litton or
                David Sydlik, Employee Benefits Security Administration, Department of
                Labor, at 202-693-8335; Lindsey Murtagh, Centers for Medicare &
                Medicaid Services, Department of Health and Human Services, at 301-492-
                4106. Customer Service Information: Information from OPM on health
                benefits plans offered under the Federal Employees Health Benefits
                (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 1-866-444-EBSA (3272) or visit the DOL's website (www.dol.gov/ebsa).
                In addition, information from HHS on private health insurance coverage
                and coverage provided by non-federal governmental group health plans
                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.
                [[Page 36873]]
                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. Patient Protections and Requirements Related to Emergency Services
                Under Section 2719A of the Public Health Service Act
                 The Patient Protection and Affordable Care Act (Pub. L. 111-148),
                was enacted on March 23, 2010 and the Health Care and Education
                Reconciliation Act of 2010, Public Law 111-152, was enacted on March
                30, 2010 (these statutes are collectively known as the ``Affordable
                Care Act'' or ``ACA''). The Affordable Care Act reorganizes, amends,
                and adds to the provisions of part A of title XXVII of the Public
                Health Service Act (PHS Act) relating to group health plans and health
                insurance issuers in the group and individual markets.\1\ The
                Affordable Care Act adds section 715(a)(1) to the Employee Retirement
                Income Security Act (ERISA) and section 9815(a)(1) to the Internal
                Revenue Code (the Code) to incorporate the provisions of part A of
                title XXVII of the PHS Act into ERISA and the Code, and make them
                applicable to group health plans and health insurance issuers providing
                health insurance coverage in connection with group health plans.
                Sections 2701 through 2728 of the PHS Act are incorporated into ERISA
                and the Code.
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                 \1\ The term ``group health plan'' includes both insured and
                self-insured group health plans.
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                 Under section 2719A of the PHS Act, as added by the Affordable Care
                Act and incorporated into ERISA and the Code, if a non-grandfathered
                group health plan or health insurance issuer offering non-grandfathered
                group or individual health insurance coverage provides any benefits
                with respect to emergency services in an emergency department of a
                hospital, the plan or issuer must cover emergency services without the
                individual or the health care provider having to obtain prior
                authorization (including when the emergency services are provided out-
                of-network) and without regard to whether the health care provider
                furnishing the emergency services is an in-network provider with
                respect to the services. The emergency services must be provided
                without regard to any other term or condition of the plan or health
                insurance coverage other than the exclusion or coordination of
                benefits, an affiliation or waiting period permitted under the Code,
                ERISA, and the PHS Act, or applicable cost-sharing requirements. For a
                plan or health insurance coverage with a network of providers that
                provides benefits for emergency services, the plan or issuer may not
                impose any administrative requirement or limitation on benefits for
                out-of-network emergency services that is more restrictive than the
                requirements or limitations that apply to in-network emergency
                services. In addition, carriers offering FEHB plans must comply with
                requirements described in section 2719A of the PHS Act in the same
                manner as they apply to a plan or issuer.
                 For purposes of the requirements under section 2719A of the PHS
                Act, emergency services mean, with respect to an emergency medical
                condition, (1) a medical screening examination (as required under
                section 1867 of the Social Security Act) that is within the capability
                of the emergency department of a hospital, including ancillary services
                routinely available to the emergency department to evaluate such
                emergency medical condition, and (2) that is within the capabilities of
                the staff and facilities available at the hospital, such further
                medical examination and treatment as are required under section 1867 of
                the Social Security Act to stabilize the patient.
                 Regulations implementing section 2719A of the PHS Act include these
                consumer protections.\2\ Section 2719A of the PHS Act did not prohibit
                balance billing. Balance billing refers to the practice of out-of-
                network providers billing patients for the difference between (1) the
                provider's billed charges, and (2) the amount collected from the plan
                or issuer plus the amount collected from the patient in the form of
                cost sharing (such as a copayment, coinsurance, or amounts paid toward
                a deductible). To avoid the circumvention of the protections of section
                2719A of the PHS Act, in the implementing regulations, the Departments
                determined it was necessary that a reasonable amount be paid by a plan
                or issuer before a patient becomes responsible for a balance billing
                amount.\3\ Therefore, under the Departments' final regulations
                published in the Federal Register on November 18, 2015 (Patient
                Protections Final Rule), a plan or issuer satisfies the out-of-network
                emergency care cost-sharing limitations in the statute if it provides
                benefits for out-of-network emergency services in an amount at least
                equal to the greatest of the following three amounts (adjusted for in-
                network cost sharing): (1) The median amount negotiated with in-network
                providers for the emergency service; (2) the amount for the emergency
                service calculated using the same method the plan generally uses to
                determine payments for out-of-network services (such as the usual,
                customary, and reasonable (UCR) amount); or (3) the amount that would
                be paid under Medicare Part A or Part B for the emergency service
                (collectively, minimum payment standards).\4\ The Departments'
                regulations clarify that the cost-sharing requirements create a minimum
                payment requirement for the plan or issuer.\5\ The Departments also
                clarified that the cost-sharing requirements do not prohibit a group
                health plan or health insurance issuer from providing benefits with
                respect to an emergency service that are greater than the amounts
                specified in the regulations. However, those regulations address
                balance billing with respect to only emergency services and, even in
                that context, they serve only to minimize the amount of a balance bill
                by requiring that plans and issuers must pay a reasonable amount for
                emergency services before a patient becomes responsible for a balance
                billing amount. Prior to the enactment of the No Surprises Act, these
                minimum payment standards were the only federal consumer protections to
                reduce potential amounts of balance billing for individuals enrolled in
                group health plans and group and individual health insurance coverage.
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                 \2\ 26 CFR 54.9815-2719A(b); 29 CFR 2590.715-2719A(b); 45 CFR
                147.138(b).
                 \3\ 75 FR 37188, 37194 (June 28, 2010); see also 80 FR 72192
                (Nov. 18, 2015). Additional clarification of these rules was also
                provided in 2018. See 83 FR 19431 (May 3, 2018).
                 \4\ 26 CFR 54.9815-2719A(b)(3); 29 CFR 2590.715-2719A(b)(3); 45
                CFR 147.138(b)(3).
                 \5\ If state law prohibits balance billing, or in cases in which
                a group health plan or health insurance issuer is contractually
                responsible for balance billing amounts, plans and issuers are not
                required to satisfy the minimum payment standards set forth in the
                regulations, but may not impose any copayment or coinsurance
                requirement for out-of-network emergency services that is higher
                than the copayment or coinsurance requirement that would apply if
                the services were provided in-network. See 26 CFR 54.9815-
                2719A(b)(3)(iii); 29 CFR 2590.715-2719A(b)(3)(iii); 45 CFR
                147.138(b)(3)(iii); FAQs about Affordable Care Act Implementation
                (Part I), Q15 (Sept. 20, 2010), available at https://www.dol.gov/agencies/ebsa/laws-and-regulations/laws/affordable-care-act/for-employers-and-advisers/aca-implementation-faqs; www.cms.gov/CCIIO/Resources/Fact-Sheets-and-FAQs/aca_implementation_faqs.html.
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                [[Page 36874]]
                 The No Surprises Act added section 9816 of the Code, section 716 of
                ERISA, and section 2799A-1 of the PHS Act, which expand the patient
                protections related to emergency services under section 2719A of the
                PHS Act, in part, by providing additional consumer protections related
                to balance billing.\6\ The No Surprises Act amended section 2719A of
                the PHS Act to include a sunset provision effective for plan years
                beginning on or after January 1, 2022, when the new protections under
                the No Surprises Act take effect.
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                 \6\ These new protections apply regardless of whether the plan
                or coverage is a grandfathered health plan under section 1251 of the
                Affordable Care Act. The No Surprises Act also amended 5 U.S.C.
                8902(p) to ensure that covered individuals enrolled in FEHB plans
                receive these protections.
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                 Additionally, the No Surprises Act recodified the patient
                protections regarding choice of health care professional from section
                2719A(a), (c), and (d) of the PHS Act at new section 9822 of the Code,
                section 722 of ERISA, and section 2799A-7 of the PHS Act. If a plan or
                issuer requires or provides for designation by a participant,
                beneficiary, or enrollee of a participating primary care provider,
                these provisions permit individuals to designate any participating
                primary care providers available to accept them, including
                pediatricians, and prohibit the plan or issuer from requiring
                authorization or referral for obstetrical or gynecological care.
                B. Surprise Billing and the Need for Greater Consumer Protections
                 Most group health plans, and health insurance issuers offering
                group or individual health insurance coverage, have a network of
                providers and health care facilities (participating providers or
                preferred providers) who agree by contract to accept a specific amount
                for their services.\7\ By contrast, providers and facilities that are
                not part of a plan or issuer's network (nonparticipating providers)
                usually charge higher amounts than the contracted rates that plans and
                issuers have negotiated with participating providers and facilities.
                When a participant, beneficiary, or enrollee receives care from a
                nonparticipating provider, the individual's plan or issuer may decline
                to pay for the service or may pay an amount that is lower than the
                provider's billed charges, and may subject the individual to greater
                cost-sharing requirements than would have been charged had the services
                been furnished by a participating provider. Prior to the No Surprises
                Act, the nonparticipating provider could generally balance bill the
                individual for the difference between the provider's billed charges and
                the sum of the amount paid by the plan or issuer and the cost sharing
                paid by the individual, unless otherwise prohibited by state law.
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                 \7\ These interim final rules refer to providers both in terms
                of their participation (participating provider) and in terms of a
                network (in-network provider). In both situations, the intent is to
                refer to a provider that has a contractual relationship or other
                arrangement with a plan or issuer to provide health care items and
                services for participants, beneficiaries, and enrollees of the plan
                or issuer.
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                 A balance bill may come as a surprise for the individual. A
                surprise medical bill is an unexpected bill from a health care provider
                or facility that occurs when a covered person receives 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. Surprise billing occurs both
                for emergency and non-emergency care. In an emergency, a person usually
                goes (or is taken by emergency transport) to a nearby emergency
                department. Even if they go to a participating hospital or facility for
                emergency care, they may receive care from nonparticipating providers
                working at that facility. For non-emergency care, a person may choose a
                participating facility (and possibly even a participating provider),
                but not know that at least one provider involved in their care (for
                example, an anesthesiologist or radiologist) is a nonparticipating
                provider. In either circumstance, the person might not be in a position
                to choose the provider, or to ensure that the provider is a
                participating provider. Therefore, in addition to a bill for their
                cost-sharing amount, which tends to be higher for out-of-network
                services, the person might receive a balance bill from the
                nonparticipating provider or facility. This scenario also plays out
                frequently for air ambulance services, where individuals generally do
                not have the ability to select a provider of air ambulance services,
                and, therefore, have little or no control over whether the provider is
                in-network with their plan or coverage.
                 When individuals are unable to avoid nonparticipating providers, it
                raises health care costs and exposes patients to financial risk.\8\ The
                evidence suggests that the ability to balance bill is used as leverage
                by some providers to obtain higher in-network payments, which results
                in higher premiums, higher cost sharing for individuals, and increased
                health care expenditures overall.\9\ Studies have shown that surprise
                bills can be large. For example, a recent study found that physicians
                collected, on average, 65 percent of the total charged amount for
                emergency department visits that likely included surprise bills,
                compared to 52 percent of the total charged amount for emergency
                department visits that likely did not include surprise bills. The study
                also found that nine percent of the individuals who likely received
                surprise bills paid physicians an amount more than $400, which may
                cause financial hardship to many individuals.\10\ In addition, out-of-
                network cost sharing and payments for surprise bills usually do not
                count towards an individual's deductible and maximum out-of-pocket
                expenditure limits. Therefore, individuals with surprise bills may have
                difficulty reaching those limits, even after a significant health care
                event.
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                 \8\ Cooper Z et al., Out-of-Network Billing and Negotiated
                Payments for Hospital-Based Physicians, Health Affairs 39, No. 1,
                2020. doi: 10.1377/hlthaff.2019.00507.
                 \9\ See Cooper, Z. et al., Surprise! Out-Of-Network Billing For
                Emergency Care in the United States, NBER Working Paper 23623,
                20173623; Duffy, E. et al., Policies to Address Surprise Billing Can
                Affect Health Insurance Premiums. The American Journal of Managed
                Care 26.9 (2020): 401-404.; and Brown E.C.F., et al., The Unfinished
                Business of Air Ambulance Bills, Health Affairs Blog (March 26,
                2021), DOI: 10.1377/hblog20210323.911379, available at https://www.healthaffairs.org/do/10.1377/hblog20210323.911379/full/.
                 \10\ Biener, A. et al., Emergency Physicians Recover a Higher
                Share of Charges From Out-Of-Network Care Than From In-Network Care,
                Health Affairs 40, No, 4 (2021): 622-628.
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                 Another study using claims data from a large commercial issuer for
                the period 2010-2016 found that over 39 percent of emergency department
                visits to in-network hospitals resulted in an out-of-network bill, and
                the incidence increased from 32.3 percent in 2010 to 42.8 percent in
                2016. The average potential amount of surprise medical bills also
                increased from $220 in 2010 to $628 in 2016. During the same period, 37
                percent of inpatient admissions to in-network hospitals resulted in at
                least one out-of-network bill, increasing from 26.3 percent in 2010 to
                42 percent in 2016, and the average potential surprise medical bill
                increased from $804 to $2,040.\11\
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                 \11\ Sun EC, Mello MM, Moshfegh J, Baker LC, Assessment of Out-
                of-Network Billing for Privately Insured Patients Receiving Care in
                In-Network Hospitals. JAMA Intern Med. 2019; 179(11):1543-1550
                (2019). doi:10.1001/jamainternmed.2019.3451.
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                 Although some states have enacted laws to reduce or eliminate
                balance billing, these efforts have created a patchwork of consumer
                protections. Even within a state that has enacted such protections,
                those protections typically apply only to individuals enrolled in
                individual and group health insurance coverage, as ERISA generally
                [[Page 36875]]
                preempts state laws that regulate self-insured group health plans
                sponsored by private employers. In addition, states are limited in
                their ability to address surprise bills that involve an out-of-state
                provider.
                 Surprise medical bills can lead to medical debt for individuals who
                have difficulty paying their bills. The impact is most keenly felt by
                those communities experiencing poverty and other social risk factors,
                as surprise medical bills and medical debt can negatively affect
                individuals' abilities to eliminate debt and create wealth, and
                ultimately can affect a family for generations.\12\ A recent survey
                reported that while 68 percent of respondents said that it was
                difficult to pay a surprise bill, the likelihood of such difficulty was
                higher for middle income respondents (77 percent) and African Americans
                (74 percent). In addition, while 11 percent of survey respondents were
                unable to pay the surprise bill, 21 percent of low income respondents,
                19 percent of African Americans, and 17 percent of respondents in rural
                areas were unable to do so.\13\ In addition, individuals are often
                confused by medical bills. A 2016 survey found that 61 percent of
                individuals are confused by medical bills, and for 49 percent of
                individuals surveyed, the amount owed was a surprise.\14\ These
                challenges are exacerbated for underserved communities, which are more
                likely to experience poor communication, underlying mistrust of the
                medical system, and lower levels of patient engagement than other
                populations.\15\ Effective, culturally, and linguistically tailored
                communication at appropriate literacy levels, coupled with policies
                that address the social risk factors and other barriers underserved
                communities face to accessing, trusting, and understanding health care
                costs and coverage, can reduce disparities and promote health
                equity.\16\
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                 \12\ Taylor, J. Racism, inequality, and health care for African
                Americans. The Century Foundation: Report (December 19, 2019).
                https://tcf.org/content/report/racism-inequality-health-care-african-americans/; Chavis, B. Op-Ed: Big insurance must help end
                surprise medical billing. blackpressUSA (February 24, 2020).
                 \13\ Families USA, Surprise Medical Bills, Results from a
                National Survey, November 2019. https://familiesusa.org/wp-content/uploads/2019/11/Surprise-Billing-National-Poll-Report-FINAL.pdf.
                 \14\ Gooch, Kelly. 61% of patients confused by medical bills,
                survey finds. Becker's Hospital Review (July 14, 2016). https://www.beckershospitalreview.com/finance/61-of-patients-confused-by-medical-bills-survey-finds.html.
                 \15\ See Butler S, Sherriff N. How poor communication
                exacerbates health inequities and what to do about it. Brookings
                Institution: Report (February 22, 2021). https://www.brookings.edu/research/how-poor-communication-exacerbates-health-inequities-and-what-to-do-about-it/; Hamel, L., Lopes, L., Mu[ntilde]ana, C.,
                Artiga, S., Brodie, M. Race, Health, and COVID-19: The Views and
                Experiences of Black Americans. Kaiser Family Foundation (October
                2020). https://files.kff.org/attachment/Report-Race-Health-and-COVID-19-The-Views-and-Experiences-of-Black-Americans.pdf; Shen
                M.J., Peterson E.B., Costas-Mu[ntilde]iz R. et al. The Effects of
                Race and Racial Concordance on Patient-Physician Communication: A
                Systematic Review of the Literature. J. Racial and Ethnic Health
                Disparities 5, 117-140 (2018). https://doi.org/10.1007/s40615-017-0350-4.
                 \16\ P[eacute]rez-Stable EJ, El-Toukhy S. Communicating with
                diverse patients: How patient and clinician factors affect
                disparities. Patient Educ Couns. 2018;101(12):2186-2194.
                doi:10.1016/j.pec.2018.08.021; McNally, M. Confronting disparities
                in access to healthcare for underserved populations. MedCity News
                (February 22, 2021). https://medcitynews.com/2021/02/confronting-disparities-in-access-to-healthcare-for-underserved-populations-in-2021/.
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                 Communication among providers, plans, consumers, communities, and
                consumer advocates must be consistent with and reinforce all relevant
                consumer protections related to surprise bills. Such communication must
                be accessible, linguistically tailored, and at an appropriate literacy
                level. This includes compliance with requirements to provide effective
                communication for individuals with disabilities under the Americans
                with Disabilities Act of 1990,\17\ section 504 of the Rehabilitation
                Act of 1973 \18\ and, where applicable, section 1557 of the Affordable
                Care Act,\19\ as well as compliance with race, color, and national
                origin protections under title VI of the Civil Rights Act of 1964 \20\
                and section 1557 of the Affordable Care Act. Section 1557 prohibits
                discrimination on the basis of race, color, national origin, sex
                (including sexual orientation and gender identity), age, or disability
                in covered health programs or activities, including requiring covered
                entities to take reasonable steps to ensure meaningful access for
                individuals with limited English proficiency.
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                 \17\ 42 U.S.C. 12101 et seq.
                 \18\ 29 U.S.C. 794 and 794d.
                 \19\ 42 U.S.C. 18116(a).
                 \20\ 42 U.S.C. 2000d.
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                 On January 20, 2021, President Biden issued Executive Order 13985,
                ``On Advancing Racial Equity and Support for Underserved Communities
                Through the Federal Government,'' \21\ directing that as a policy
                matter, the federal government should pursue a comprehensive approach
                to advancing equity for all, including people of color and others who
                have been historically underserved, marginalized, and adversely
                affected by persistent poverty and inequality. Executive Order 13985
                also directs HHS to assess whether, and to what extent, its programs
                and policies perpetuate systemic barriers to opportunities and benefits
                for people of color and other underserved groups. Consistent with
                Executive Order 13985, regulations issued pursuant to the No Surprises
                Act must ensure that communication from plans, issuers, providers,
                facilities, and providers of air ambulance services recognizes these
                inequities and upholds all relevant consumer protections. Regulations
                issued pursuant to the No Surprises Act should ensure that all
                individuals, particularly those from underserved and minority
                communities, trust and believe information they receive related to
                costs and network coverage. Regulations and policies should enable and
                encourage regulated entities to address barriers to accessing care,
                including mistrust of the health care system. They should also
                encourage entities to communicate with individuals in a language they
                can understand, in a respectful way that addresses cultural
                differences, and at an appropriate literacy level. To ensure all
                consumers, particularly those in minority and underserved communities,
                are able to understand and benefit from these consumer protections,
                deliberate attention must be paid to the unique barriers and challenges
                underserved communities face in understanding and accessing health
                care. The Departments seek comment from those who are members of,
                advocate for, and work with underserved communities regarding the
                impact of these interim final rules.
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                 \21\ 86 FR 7009 (Jan. 25, 2021).
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                C. Preventing Surprise Medical Bills Under the Consolidated
                Appropriations Act, 2021
                 On December 27, 2020, the Consolidated Appropriations Act, 2021
                (CAA), which included the No Surprises Act, was signed into law. 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.\22\
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                 \22\ Public Law 116-260.
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                 The CAA added provisions that apply to group health plans and
                health insurance issuers in the group and individual market in a new
                Part D of title XXVII of the PHS Act, and also added new provisions to
                part 7 of ERISA, and subchapter B of chapter 100 of the Code. Section
                102 of the No Surprises Act added section 9816 of the Code, section 716
                of ERISA, and section 2799A-1 of the PHS Act, which contain limitations
                on cost sharing, and requirements for initial payments for emergency
                services and for non-emergency services provided by
                [[Page 36876]]
                nonparticipating providers at certain participating health care
                facilities. Section 103 of the No Surprises Act amended section 9816 of
                the Code, section 716 of ERISA, and section 2799A-1 of the PHS Act to
                establish an independent dispute resolution (IDR) process that allows
                plans and issuers and nonparticipating providers and nonparticipating
                emergency facilities to resolve disputes over out-of-network rates.
                Section 105 of the No Surprises Act added section 9817 of the Code,
                section 717 of ERISA, and section 2799A-2 of the PHS Act, which contain
                limitations on cost sharing and requirements for initial payments to
                nonparticipating providers of air ambulance services, and allow plans
                and issuers and such providers of air ambulance services to access the
                IDR process. The CAA also amended the FEHBA, as discussed in more
                detail in section I.D. of this preamble.
                 The CAA provisions that apply to health care providers and
                facilities and providers of air ambulance services, such as cost-
                sharing requirements, 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.
                 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. Later this year, the
                Departments intend to issue regulations regarding the federal IDR
                process (sections 103 and 105 of Division BB), patient protections
                through transparency and the patient-provider dispute resolution
                process (section 112), and price comparison tools (section 114). The
                Departments also intend to undertake rulemaking this year to propose
                the form and manner in which plans, issuers, and providers of air
                ambulance services would report information regarding air ambulance
                services (section 106). In addition, HHS intends to undertake
                rulemaking to implement 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)), as well as provisions related to HHS enforcement of
                requirements on issuers, non-federal governmental group health plans,
                providers, facilities, and providers of air ambulance services.
                 The CAA also includes provisions regarding transparency in plan and
                insurance identification cards (section 107), continuity of care
                (section 113), accuracy of provider network directories (section 116),
                and prohibition on gag clauses (section 201) that are applicable for
                plan years beginning on or after January 1, 2022; and pharmacy benefit
                and drug cost reporting (section 204) that is required by December 27,
                2021. The Departments intend to undertake rulemaking to fully implement
                these provisions, but rulemaking regarding some of these provisions
                might not occur until after January 1, 2022. The Departments note that
                any such rulemaking to fully implement these provisions will include a
                prospective applicability date that provides plans, issuers, providers,
                and facilities, as applicable, a reasonable amount of time to comply
                with new or clarified requirements. Until rulemaking to fully implement
                these provisions is finalized and effective, plans and issuers are
                expected to implement the requirements using a good faith, reasonable
                interpretation of the statute. The Departments intend to issue guidance
                in the near future regarding their expectations related to good faith
                compliance with these provisions.
                D. Preventing Surprise Medical Bills for Federal Employees Health
                Benefits Plans
                 The No Surprises Act also amended the FEHBA, 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 provisions of sections 9816, 9817, and 9822 of the Code; sections
                716, 717, and 722 of ERISA; and sections 2799A-1, 2799A-2, and 2799A-7
                of the PHS Act (as applicable) in the same manner as they apply with
                respect to a group health plan or health insurance issuer offering
                group or individual health insurance coverage. Likewise, the provisions
                of sections 2799B-1, 2799B-2, 2799B-3, and 2799B-5 of the PHS Act apply
                to health care providers, facilities, and providers of air ambulance
                services with respect to covered individuals in FEHB plans in the same
                manner as they apply to participants, beneficiaries, or enrollees in
                group health plans or coverage offered by health insurance issuers.
                 OPM is charged with administering the FEHB Program and maintains
                oversight and enforcement authority with respect to FEHB health
                benefits plans, which are federal governmental plans. Generally, under
                5 U.S.C. 8902(p), each FEHB contract must require a carrier to comply
                with certain PHS Act, ERISA, and Code requirements in the same manner
                as they apply to a group health plan or health insurance issuer.
                II. Executive Summary
                 These interim final rules implement provisions of the No Surprises
                Act that: (1) Apply to group health plans, health insurance issuers
                offering group or individual health insurance coverage, and carriers in
                the FEHB Program to provide protections against balance billing and
                out-of-network cost sharing with respect to emergency services, non-
                emergency services furnished by nonparticipating providers at certain
                participating health care facilities, and air ambulance services
                furnished by nonparticipating providers of air ambulance services; (2)
                prohibit nonparticipating providers, health care facilities, and
                providers of air ambulance services from balance billing participants,
                beneficiaries, and enrollees in certain situations, and permit these
                providers and facilities to balance bill individuals if certain notice
                and consent requirements in the No Surprises Act are satisfied; (3)
                require certain health care facilities and providers to provide
                disclosures of federal and state patient protections against balance
                billing; (4) recodify certain patient protections that initially
                appeared in the ACA and that the No Surprises Act applies to
                grandfathered plans; and (5) set forth complaints processes with
                respect to violations of the protections against balance billing and
                out-of-network cost sharing under the No Surprises Act.
                 These interim final rules protect individuals from surprise medical
                bills for emergency services, air ambulance services furnished by
                nonparticipating providers, and non-emergency services furnished by
                nonparticipating providers at participating facilities in certain
                circumstances. Among other requirements, these interim final rules
                require emergency services to be covered without any prior
                authorization, without regard to whether the health care provider
                furnishing the emergency services is a participating provider or a
                participating emergency facility with respect to the services, 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. Additionally, emergency services include
                certain services in an emergency department of a hospital or an
                independent freestanding emergency department, as well as post-
                stabilization services in certain instances.
                 With respect to emergency services, air ambulance services
                furnished by nonparticipating providers, and non-
                [[Page 36877]]
                emergency services furnished by nonparticipating providers at
                participating facilities, these interim final rules limit cost sharing
                for out-of-network services to in-network levels, require such cost
                sharing to count toward any in-network deductibles and out-of-pocket
                maximums, and prohibit balance billing, as required by the No Surprises
                Act.
                 These interim final rules specify that cost-sharing amounts for
                such services furnished by nonparticipating emergency facilities and
                nonparticipating providers at participating facilities must be
                calculated based on one of the following amounts: (1) An amount
                determined by an applicable All-Payer Model Agreement under section
                1115A of the Social Security Act; (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, referred to as the qualifying payment
                amount (QPA). Cost-sharing amounts for air ambulance services provided
                by nonparticipating providers must be calculated using the lesser of
                the billed charge or the QPA, and the cost-sharing requirement that
                would apply if such services were provided by a participating provider.
                 Under these interim final rules, balance billing for services
                covered by the rules generally is prohibited, and the total amount to
                be paid to the provider or facility, including any cost sharing, is
                based on: (1) An amount determined by an applicable All-Payer Model
                Agreement under section 1115A of the Social Security Act; (2) if there
                is no such applicable All-Payer Model Agreement, an amount determined
                by a specified state law; (3) if there is no such applicable All-Payer
                Model Agreement or specified state law, an amount agreed upon by the
                plan or issuer and the provider or facility; or (4) if none of those
                three conditions apply, an amount determined by an IDR entity.
                 In general, under the No Surprises Act and these interim final
                rules, the protections that limit cost sharing and prohibit balance
                billing do not apply to certain post-stabilization services, or to
                certain non-emergency services performed by nonparticipating providers
                at participating health care facilities, if the provider or facility
                provides notice to the participant, beneficiary, or enrollee, and
                obtains the individual's consent to waive the balance billing
                protections. However, providers and facilities may not provide such
                notice or seek consent from individuals in certain circumstances where
                surprise bills are likely to occur, such as for ancillary services
                provided by nonparticipating providers in connection with non-emergency
                care in a participating facility. In such circumstances, balance
                billing is prohibited, and the other protections of the No Surprises
                Act, such as in-network cost-sharing requirements, continue to apply.
                 Neither the No Surprises Act, nor these interim final rules,
                universally protect individuals from every high or unexpected medical
                bill. For example, an individual may be enrolled in a group health plan
                or health insurance coverage that provides little or no coverage for
                their particular health care condition or the items and services
                necessary to treat that condition. In addition, balance billing
                continues to be permitted, unless prohibited by state law or contract,
                in circumstances where these interim final rules do not apply, such as
                for non-emergency items or services provided at facilities that are not
                included within the definition of health care facility in these interim
                final rules. Nonetheless, the No Surprises Act and these interim final
                rules provide relief from some of the more common scenarios where a
                participant, beneficiary, or enrollee might otherwise be faced with
                high and unexpected medical costs.
                 These interim final rules establish a complaints process for
                receiving and resolving complaints related to these new balance billing
                protections.
                 These interim final rules also implement the requirement of the No
                Surprises Act that certain health care providers and facilities make
                publicly available, post on a public website, and provide a one-page
                notice to individuals regarding: (1) The requirements and prohibitions
                applicable to the provider or facility under sections 2799B-1 and
                2799B-2 of the PHS Act and their implementing regulations; (2) any
                applicable state balance billing requirements; and (3) how to contact
                appropriate state and federal agencies if the individual believes the
                provider or facility has violated the requirements described in the
                notice.
                 Section 116 of the No Surprises Act also added section 9820(c) of
                the Code, section 720(c) of ERISA, and section 2799A-5(c) of the PHS
                Act, which include similar disclosure requirements applicable to plans
                and issuers. In general, under these provisions, plans and issuers must
                make publicly available, post on a public website of the plan or
                issuer, and include on each explanation of benefits for an item or
                service with respect to which the requirements under section 9816 of
                the Code, section 716 of ERISA, and section 2799A-1 of the PHS Act
                apply, information on the requirements applied under these
                aforementioned sections, as applicable; on the requirements and
                prohibitions applied under sections 2799B-1 and 2799B-2 of the PHS Act;
                on other applicable state laws on out-of-network balance billing; and
                on contacting appropriate state and federal agencies in the case that
                an individual believes that such a provider or facility has violated
                the prohibition against balance billing. These disclosure requirements
                are applicable for plan years beginning on or after January 1, 2022. To
                reduce burden and facilitate compliance with these disclosure
                requirements, the Departments are concurrently issuing a model
                disclosure notice that health care providers, facilities, group health
                plans, and health insurance issuers may, but are not required to, use
                to satisfy the disclosure requirements regarding the balance billing
                protections. The Departments will consider use of the model notice in
                accordance with the accompanying instructions to be good faith
                compliance with the disclosure requirements of section 9820(c) of the
                Code, section 720(c) of ERISA, and section 2799A-5(c) of the PHS Act,
                if all other applicable requirements are met. In addition, HHS will
                consider use of the model notice in accordance with the accompanying
                instructions to be good faith compliance with the disclosure
                requirements of section 2799B-3 of the PHS Act and 45 CFR 149.430, if
                all other applicable PHS Act requirements are met. The Departments may
                address the requirements under section 9820(c) of the Code, section
                720(c) of ERISA, and section 2799A-5(c) of the PHS Act, as added by the
                No Surprises Act, in more detail in future guidance or rulemaking.
                Until further guidance is issued, plans and issuers are expected to
                implement the requirements of section 9820(c) of the Code, section
                720(c) of ERISA, and section 2799A-5(c) of the PHS Act using a good
                faith, reasonable interpretation of the law. The Departments will take
                into account the statutory applicability date and the timeframe for
                implementation when determining good faith compliance with the law.
                 These interim final rules 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, as
                [[Page 36878]]
                well as to health care providers and facilities, and providers of air
                ambulance services beginning on January 1, 2022.
                 In the OPM interim final rules included in this rulemaking, OPM
                adopts all provisions of the Departments' interim final rules that
                address the sections of the Code, ERISA, and the PHS Act that are
                referenced in 5 U.S.C. 8902(p). In the OPM interim final rules, OPM
                defines terms unique to the FEHB Program, adapts some of the
                Departments' rules as necessary to properly integrate with the existing
                FEHB Program regulatory and contractual structure, sets forth the
                circumstances in which OPM will enforce these rules against FEHB
                carriers, and sets forth the types of court actions involving the FEHB
                Program that may be brought against OPM with respect to the No
                Surprises Act.
                 In effectuating compliance with 5 U.S.C. 8902(p), FEHB contract
                terms that relate to the nature, provision, or extent of coverage or
                benefits (including payments with respect to benefits) supersede and
                preempt state law or local law, or any regulation issued thereunder,
                which relates to health insurance or plans.\23\ OPM contracts with FEHB
                carriers may include terms that adopt state law as governing for a
                particular purpose.
                ---------------------------------------------------------------------------
                 \23\ 5 U.S.C. 8902(m)(1); see Coventry Health Care of Missouri,
                Inc. v. Nevils, 137 S. Ct. 1190 (2017).
                ---------------------------------------------------------------------------
                III. Overview of the Interim Final Rules--Departments of HHS, Labor,
                and the Treasury
                A. Definitions
                 The provisions of the Code, ERISA, and the PHS Act added by the No
                Surprises Act, as well as these interim final rules, include defined
                terms that are specific to the requirements and implementation of the
                law. Definitions of these key terms are described throughout this
                preamble. These terms help define the scope of the balance billing
                protections and how cost-sharing amounts and payment levels are
                determined.
                 The Departments note that these interim final rules define the term
                ``physician or health care provider'' to mean a physician or other
                health care provider who is acting within the scope of practice of that
                provider's license or certification under applicable state law, but the
                definition specifically excludes providers of air ambulance services.
                The Departments recognize that, although the No Surprises Act does not
                define ``provider,'' it uses the term in a manner that includes
                providers of air ambulance services in some provisions. For example,
                the No Surprises Act added section 2799B-4 of the PHS Act, which
                specifically includes providers of air ambulance services when
                referencing providers. However, certain other provisions in the No
                Surprises Act apply only to providers of air ambulance services, or
                apply to health care providers generally, but by their terms are
                inapplicable to providers of air ambulance services. As an example of
                the latter, the No Surprises Act added section 2799B-2 of the PHS Act,
                which generally prohibits balance billing by nonparticipating health
                care providers furnishing non-emergency services at participating
                health care facilities. Although this provision does not explicitly
                exclude providers of air ambulance services, providers of air ambulance
                services would not furnish non-emergency services at participating
                health care facilities. Therefore, the provision does not apply to
                providers of air ambulance services (such providers are, however,
                prohibited from balance billing under section 2799B-5 of the PHS Act).
                Similarly, section 2799B-3 of the PHS Act, which requires a health care
                provider to inform individuals of the requirements and prohibitions on
                such health care provider in sections 2799B-1 and 2799B-2 of the PHS
                Act (neither of which apply to providers of air ambulance services),
                does not by its terms apply to providers of air ambulance services.
                Therefore, these interim final rules define ``physician or health care
                provider'' to exclude providers of air ambulance services, in order to
                help clarify which provisions of the No Surprises Act and interim final
                rules apply to providers of air ambulance services. In instances where
                provisions under the No Surprises Act, as implemented in these interim
                final rules, apply to providers of air ambulance services, the
                provisions explicitly reference air ambulance providers. Conversely,
                where providers of air ambulance services are not explicitly mentioned,
                the provisions do not apply.
                 The Departments seek comment on the terms defined in these interim
                final rules, including the appropriateness and usability of the
                definitions, and whether additional terms should be defined in future
                rulemaking.
                B. Preventing Surprise Medical Bills
                1. Scope of the New Surprise Billing Protections
                i. Emergency Services
                 Under section 9816(a) of the Code, section 716(a) of ERISA, and
                section 2799A-1(a) of the PHS Act, and these interim final rules, if a
                group health plan, or a health insurance issuer offering group or
                individual health insurance coverage, provides or covers 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, the plan or issuer must cover emergency services
                as defined in these interim final rules and such coverage must be
                provided in accordance with these interim final rules.
                 A plan or issuer providing coverage of emergency services must do
                so without the individual or the health care provider having to obtain
                prior authorization (including when the emergency services are provided
                out-of-network) and without regard to whether the health care provider
                furnishing the emergency services is a participating provider or a
                participating emergency facility with respect to the services. The
                emergency services must be provided without regard to any other term or
                condition of the plan or coverage other than the exclusion or
                coordination of benefits (to the extent not inconsistent with benefits
                for an emergency medical condition as defined in these interim final
                rules), an affiliation or waiting period as permitted under the Code,
                ERISA, or the PHS Act, or applicable cost-sharing requirements. For a
                plan or health insurance coverage with a network of providers that
                provides benefits for emergency services, the plan or issuer may not
                impose any administrative requirement or limitation on coverage for
                emergency services received from nonparticipating providers or
                nonparticipating emergency facilities that is more restrictive than the
                requirements or limitations that apply to emergency services received
                from participating providers or participating emergency facilities. In
                addition, such plan or health insurance coverage must comply with the
                requirements regarding cost sharing, payment amounts, and processes for
                resolving billing disputes described elsewhere in this preamble.
                 The terms ``emergency medical condition,'' ``emergency services,''
                and ``to stabilize'' generally have the meaning given to them under the
                Emergency Medical Treatment and Labor Act (EMTALA), section 1867 of the
                Social Security Act.\24\ Emergency services include: (1) An appropriate
                medical screening examination that is within the capability of the
                emergency department of a hospital or of an independent freestanding
                emergency department, including ancillary services
                [[Page 36879]]
                routinely available to the emergency department, to evaluate whether an
                emergency medical condition exists; and (2) such further medical
                examination and treatment as may be required to stabilize the
                individual (regardless of the department of the hospital in which the
                further medical examination and treatment is furnished) within the
                capabilities of the staff and facilities available at the hospital or
                the independent freestanding emergency department.
                ---------------------------------------------------------------------------
                 \24\ 42 U.S.C. 1395dd.
                ---------------------------------------------------------------------------
                 Under section 2719A of the PHS Act, emergency services were defined
                to include: (1) A medical screening examination (as required under
                section 1867 of the Social Security Act) that is within the capability
                of the emergency department of a hospital, including ancillary services
                routinely available to the emergency department to evaluate such
                emergency medical condition; and (2) such further medical examination
                and treatment as are required under section 1867 of the Social Security
                Act to stabilize the patient within the capabilities of the staff and
                facilities available at the hospital. HHS has previously interpreted
                the obligations on hospitals under EMTALA to provide medical
                examination and stabilization services to end when a patient is
                formally admitted in good faith.\25\ Section 9816(a) of the Code,
                section 716(a) of ERISA, and section 2799A-1(a) of the PHS Act expand
                the definition of emergency services (as compared to section 2719A of
                the PHS Act) to include stabilization services ``regardless of the
                department of the hospital in which the further medical examination and
                treatment is furnished.'' Therefore, the definition of emergency
                services in these interim final rules includes pre-stabilization
                services that are provided after the patient is moved out of the
                emergency department and admitted to a hospital, and these services
                will be subject to the protections of the No Surprises Act.
                ---------------------------------------------------------------------------
                 \25\ 42 CFR 489.24(a)(1)(ii); 68 FR 53221-53264 (Sept. 9, 2003);
                73 FR 48654-48668 (Aug. 19, 2008).
                ---------------------------------------------------------------------------
                 Section 102 of the No Surprises Act further broadens the definition
                of emergency services to include emergency services provided at an
                independent freestanding emergency department. An independent
                freestanding emergency department is a health care facility (not
                limited to those described in the definition of health care facility at
                section 9816(b)(2)(A)(ii) of the Code, section 716(b)(2)(A)(ii) of
                ERISA, and section 2799A-1(b)(2)(A)(ii) of the PHS Act, as applicable)
                that provides emergency services, and is geographically separate and
                distinct from a hospital, and separately licensed as such by a state.
                The definition of ``independent freestanding emergency department'' is
                intended to include any health care facility that is geographically
                separate and distinct from a hospital, and that is licensed by a state
                to provide emergency services, even if the facility is not licensed
                under the term ``independent freestanding emergency department.''
                 Regulation of health care facilities varies by state. In
                particular, state regulation of urgent care centers varies
                significantly, and is evolving as these types of centers become more
                common.\26\ If under state licensure laws, urgent care centers are
                permitted to provide emergency services, then urgent care centers in
                that state that are geographically separate and distinct from a
                hospital would fall within the definition of independent freestanding
                emergency department for purposes of these interim final rules. In
                contrast, if state licensure of urgent care centers does not permit
                such facilities to provide emergency services as defined in these
                interim final rules, then urgent care centers in that state would not
                be treated as independent freestanding emergency departments for
                purposes of these interim final rules. Finally, the definition of
                emergency services also includes additional post-stabilization
                services, as discussed in section III.B.1.ii of this preamble.
                ---------------------------------------------------------------------------
                 \26\ Association of State and Territorial Health Officials. As
                Urgent Care Centers Increase, Licensing Authority Falling Under
                State Health Agencies, (Oct. 11, 2018) available at https://www.astho.org/StatePublicHealth/As-Urgent-Care-Centers-Increase-Licensing-Authority-Falling-Under-State-Health-Agencies/10-11-18/.
                ---------------------------------------------------------------------------
                 The term ``emergency medical condition'' means a medical condition
                manifesting itself by acute symptoms of sufficient severity (including
                severe pain) such that a prudent layperson, who possesses an average
                knowledge of health and medicine, could reasonably expect the absence
                of immediate medical attention to result in a condition described in
                EMTALA, including (1) placing the health of the individual (or, with
                respect to a pregnant woman, the health of the woman or her unborn
                child) in serious jeopardy, (2) serious impairment to bodily functions,
                or (3) serious dysfunction of any bodily organ or part.\27\ This
                definition includes mental health conditions and substance use
                disorders.
                ---------------------------------------------------------------------------
                 \27\ See 42 U.S.C. 1395dd(e)(1)(A).
                ---------------------------------------------------------------------------
                 The Departments are aware that some plans and issuers currently
                deny coverage of certain services provided in the emergency department
                of a hospital by determining whether an episode of care involves an
                emergency medical condition based solely on final diagnosis codes, such
                as International Classification of Diseases, Tenth Revision, Clinical
                Modification (ICD-10-CM) codes . In addition, some plans and issuers
                might automatically deny coverage based on a list of final diagnosis
                codes initially, without regard to the individual's presenting symptoms
                or any additional review. Following an initial denial, plans and
                issuers might then provide for complete consideration of the claim, and
                apply the prudent layperson standard, only as part of an appeals
                process if the participant, beneficiary, or enrollee appeals. These
                practices are inconsistent with the emergency services requirements of
                the No Surprises Act and the ACA.\28\ This is true even if the process
                for complete consideration of the claim following an initial denial is
                not designated as a formal appeal. Instead, the determination of
                whether the prudent layperson standard is met must be made on a case-
                by-case basis before an initial denial of an emergency services claim.
                ---------------------------------------------------------------------------
                 \28\ See also Am. Coll. of Emergency Physicians v. Blue Cross &
                Blue Shield of Georgia, No. 20-11511, 2020 WL 6165852 (11th Cir.
                Oct. 22, 2020) (per curiam) (reversing dismissal of plaintiffs' ACA
                and ERISA claims alleging defendants violated prudent layperson
                standard where review process was based upon physician review of
                medical records and diagnostic codes; prudent layperson standard
                ignores a patient's final diagnosis and instead asks whether a
                person with average medical knowledge would reasonably think they
                need emergency services to address their symptoms).
                ---------------------------------------------------------------------------
                 These interim final rules make clear that if a group health plan,
                or a health insurance issuer offering group or individual health
                insurance coverage, provides or covers 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,
                the plan or issuer must cover emergency services without limiting what
                constitutes an emergency medical condition (as defined in these interim
                final rules) solely on the basis of diagnosis codes. When a plan or
                issuer denies coverage, in whole or in part, for a claim for payment of
                a service rendered in the emergency department of a hospital or
                independent freestanding emergency department, including services
                rendered during observation or surgical services, the determination of
                whether the prudent layperson standard has been met must be based on
                all pertinent documentation and be focused on the presenting symptoms
                (and not solely on the final diagnosis). This determination must take
                into account that the legal standard
                [[Page 36880]]
                regarding the decision to seek emergency services is based on whether a
                prudent layperson (rather than a medical professional) would reasonably
                consider the situation to be an emergency.\29\ In covering emergency
                services, plans and issuers must also ensure that they do not restrict
                the coverage of emergency services by imposing a time limit between the
                onset of symptoms and the presentation of the participant, beneficiary,
                or enrollee at the emergency department. Similarly, plans and issuers
                also may not restrict the coverage of emergency services because the
                patient did not experience a sudden onset of the condition.
                ---------------------------------------------------------------------------
                 \29\ However, nothing in the statute or these interim final
                rules prevents a plan or issuer from approving coverage for
                emergency services solely on the basis of diagnosis codes, or from
                taking diagnostic codes into account when deciding payment for a
                claim for emergency services, provided a denial of coverage is not
                based solely on diagnosis codes.
                ---------------------------------------------------------------------------
                 The Departments are also aware that some plans and issuers that
                generally provide coverage for emergency services have nonetheless
                denied benefits for such services based on other general plan
                exclusions. For example, the Departments are aware of some plans and
                issuers denying claims for emergency services provided to dependent
                women who are pregnant, based on a general plan exclusion for dependent
                maternity care. As explained previously, both the coverage of emergency
                services rules issued under section 2719A of the PHS Act and the new
                emergency services requirements included in these interim final rules
                provide, in part, that if a plan or issuer provides or covers any
                benefits with respect to services in an emergency department of a
                hospital (or under these interim final rules, in an independent
                freestanding emergency department), emergency services must be provided
                ``without regard to any other term or condition of the plan or coverage
                (other than the exclusion or coordination of benefits . . . ).'' The
                Departments clarify that this provision does not permit plans and
                issuers to exclude benefits for items and services that would otherwise
                constitute benefits for an emergency medical condition as defined under
                these interim final rules. This provision does not permit plans and
                issuers that cover emergency services to deny benefits for a
                participant, beneficiary, or enrollee with an emergency medical
                condition that receives emergency services, based on a general plan
                exclusion that would apply to items and services other than emergency
                services.
                ii. Post-Stabilization Services
                 Under section 9816(a)(3)(C)(ii) of the Code, section
                716(a)(3)(C)(ii) of ERISA, and section 2799A-1(a)(3)(C)(ii) of the PHS
                Act, emergency services include any additional items and services that
                are covered under a plan or coverage and furnished by a
                nonparticipating provider or nonparticipating emergency facility
                (regardless of the department of the hospital in which such items and
                services are furnished) after a participant, beneficiary, or enrollee
                is stabilized and as part of outpatient observation or an inpatient or
                outpatient stay with respect to the visit in which the other emergency
                services are furnished. Such additional items and services (referred to
                in this preamble as post-stabilization services) are considered
                emergency services subject to surprise billing protections unless the
                conditions enumerated in section 9816(a)(3)(C)(ii)(II)(aa)-(cc) of the
                Code, section 716(a)(3)(C)(ii)(II)(aa)-(cc) of ERISA, or section 2799A-
                1(a)(3)(C)(ii)(II)(aa)-(cc) of the PHS Act, as applicable, are met, as
                well as such other conditions as specified by the Departments under
                paragraph (dd) of the respective sections. Therefore, these interim
                final rules provide that post-stabilization services are emergency
                services unless all of the following conditions are met.
                 First, the attending emergency physician or treating provider must
                determine that the participant, beneficiary, or enrollee is able to
                travel using nonmedical transportation or nonemergency medical
                transportation to an available participating provider or facility
                located within a reasonable travel distance, taking into consideration
                the individual's medical condition. The HHS interim final rules codify
                this requirement at 45 CFR 149.410(b)(1). For this purpose, a treating
                provider is a physician or health care provider who has evaluated the
                individual. It is generally expected that a treating provider with
                medical training and experience related to the individual's specific
                medical condition will determine if the individual is able to travel
                using nonmedical transportation or nonemergency medical transportation
                to an available participating provider or facility located within a
                reasonable travel distance. This determination is based on all the
                relevant facts and circumstances and the individual should be involved
                in the decision-making process, if possible. The determination by the
                attending emergency physician or treating provider is binding on the
                facility for purposes of this requirement. This requirement is based on
                the Departments' understanding that such provider is in the best
                position to make this determination.
                 For individuals receiving care in or near their plan's or issuer's
                covered service area, as well as individuals with coverage that uses a
                national network of providers and facilities, the statutory criterion
                would generally be sufficient to ensure that an individual can freely
                choose, based on their medical condition, to receive post-stabilization
                services at a participating facility or participating provider. The
                additional requirement in these interim final rules that the individual
                be able to travel to an available participating provider or facility
                located within a reasonable travel distance, taking into consideration
                the individual's medical condition, is necessary and appropriate to
                carry out the provision of the No Surprises Act, as the requirement is
                intended to address the common situations in which an individual has
                received emergency services in a geographic region far from where any
                participating providers or facilities are located. In cases where the
                individual cannot travel using nonmedical transportation or
                nonemergency medical transportation, or cases where there are no
                participating facilities or participating providers located within a
                reasonable travel distance, taking into account the individual's
                medical condition, the Departments are of the view that individuals are
                unable to provide consent freely and, therefore, balance billing
                protections continue to apply.
                 In addition, the Departments recognize that an individual's
                transportation options may vary based on the individual's location,
                social risk, and other risk factors. In cases of underserved and
                geographically isolated communities and those with social risk factors
                related to income and transportation options, individuals may face
                additional barriers to obtaining post-stabilization services without a
                disruption in care. For example, individuals may not have the ability
                to pay for a taxi, may not have access to a car, may not be able to
                safely take public transit due to their medical condition, or may not
                have public transit options available. In these cases, the net effect
                would be the same: The individual would face unreasonable travel
                burdens that could prevent them from being able to consent freely to a
                waiver of the otherwise applicable balance billing protections. The
                Departments expect the attending emergency physician or treating
                provider to consider such factors when
                [[Page 36881]]
                assessing the individual's ability to travel to a participating
                provider or facility. The Departments seek comment on the definition of
                ``reasonable travel distance'' and whether specific standards or
                examples should be provided regarding what constitutes an unreasonable
                travel burden. For example, should reasonable travel distance take into
                account only mileage, or also other factors, such as traffic or other
                route conditions that might make traveling difficult, time consuming,
                or hazardous?
                 In contrast to situations where a participant, beneficiary, or
                enrollee is able to travel using nonmedical transportation or
                nonemergency medical transportation following stabilization, in the
                event that the individual requires medical transportation to travel,
                including transportation by either ground or air ambulance vehicle, the
                individual is not in a condition to receive notice or provide consent.
                Therefore, the surprise billing protections continue to apply to post-
                stabilization services provided in connection with the visit for which
                the individual received emergency services.
                 Second, the provider or facility furnishing post-stabilization
                services must satisfy the notice and consent criteria of section 2799B-
                2(d) of the PHS Act with respect to such items and services (which are
                implemented in HHS-only interim final rules at 45 CFR 149.410(b)(2),
                and incorporate by reference the criteria for notice and consent in 45
                CFR 149.420(c) through (g)).
                 Third, the individual (or the individual's authorized
                representative) must be in a condition to receive the information in
                the notice described in section 2799B-2 of the PHS Act (which is also
                implemented in 45 CFR 149.410(b)(3)) and to provide informed consent
                under such section, in accordance with applicable state law. Whether an
                individual is in a condition to receive the information in the notice
                is determined by the attending physician or treating provider using
                appropriate medical judgment. It is generally expected that an
                attending physician or treating provider with medical training and
                experience related to the individual's specific medical condition will
                make this determination based on all the relevant facts and
                circumstances. In addition to applying any requirements under state
                law, such medical professionals should apply the same principles as
                they would when determining if a patient is able to provide informed
                consent for treatment.\30\ They should assess whether an individual is
                capable of understanding the information provided in the notice and the
                implications of consenting. Consideration must be given to the
                individual's state of mind after receiving the emergency services and
                the individual's emotional state at the time of consent. For example,
                consideration must be given to the effect of any alcohol or drug use by
                the individual, including the use or administration of prescribed
                medications, as well as to any pain the individual is experiencing, and
                the impact of those factors on the patient's state of mind. If the
                individual is experiencing a mental or behavioral health episode or
                displaying symptoms of a mental or behavioral health disorder, or is
                impaired by a substance abuse disorder, consideration should also be
                given as to whether the individual's condition impairs their ability to
                receive the information in the notice and provide informed consent. In
                addition, consideration must be given to cultural and contextual
                factors that may affect the informed decision-making and consent
                process for members of underserved communities, including lack of trust
                arising from historical inequities, misinformation about the informed
                consent process, or barriers to comprehension of the information given
                through the informed consent process and after the informed consent
                document is signed.\31\ These barriers may include accessibility,
                language, and literacy barriers. In addition, the informed consent must
                be obtained in a way that adheres to all civil rights protections cited
                within this rulemaking, ensuring that all individuals including those
                from underserved, underrepresented communities, with limited English
                proficiency, and with disabilities, are able to understand and freely
                make informed decisions.
                ---------------------------------------------------------------------------
                 \30\ Ethics guidance for physicians, published by the American
                Medical Association, states that physicians should ``[a]ssess the
                patient's ability to understand relevant medical information and the
                implications of treatment alternatives and to make an independent,
                voluntary decision'' as part of the process of seeking informed
                consent. American Medical Association, Code of Medical Ethics
                Opinion 2.1.1, available at https://www.ama-assn.org/system/files/2019-06/code-of-medical-ethics-chapter-2.pdf (last visited April 5,
                2021). See also Gostin, LO. Public Health Law, 217-218 (2000)
                (discussing the four elements of the doctrine of informed consent:
                Information, competency, voluntariness, and specificity).
                 \31\ For a discussion of strategies to improve informed consent
                processes for minority communities, see Quinn, S.C., et al.
                Improving Informed Consent with Minority Participants: Results from
                Researcher and Community Surveys, Journal of Empirical Research on
                Human Research Ethics, 7(5): 44-55 (Dec. 2012).
                ---------------------------------------------------------------------------
                 Consent must be made voluntarily, meaning the individual must be
                able to consent freely, without undue influence, fraud, or duress. If
                post-stabilization services must be provided quickly after the
                emergency services are provided, it may be challenging for the
                individual or their authorized representative to have adequate time to
                make a clear-minded decision regarding consent. Consent obtained
                through a threat of restraint or immediacy of the need for treatment is
                not voluntary. In addition, the emergency physician or treating
                provider should consider whether the individual has reasonable options
                regarding post-stabilization services, transport, or service provider
                or facility. The Departments are of the view that the post-
                stabilization notice and consent procedures should generally be applied
                in limited circumstances, where the individual knowingly and
                purposefully seeks care from a nonparticipating provider or facility
                (such as deciding to go under the care of a specific provider or
                facility that the individual is familiar or comfortable with), and that
                the process should not be permitted to circumvent the consumer
                protections in the No Surprises Act.
                 Fourth, the provider or facility must satisfy any additional
                requirements or prohibitions as may be imposed under applicable state
                law. These interim final rules include this criterion recognizing that
                some state laws do not permit exceptions to state balance billing
                protections, such as allowing individuals to consent to waive
                protections. Thus, states may impose stricter standards by which post-
                stabilization services will be exempted from the surprise billing
                protections under these interim final rules, or states might not permit
                exceptions at all. This requirement is codified in the HHS interim
                final rules at 45 CFR 149.410(b)(5).
                 The No Surprises Act authorizes the Departments to specify other
                conditions that must be satisfied for post-stabilization services to be
                excepted from the definition of emergency services for purposes of the
                No Surprises Act. The Departments solicit comments on the conditions
                described earlier in this section. The Departments also seek comment on
                whether there are any additional conditions that would be appropriate
                to designate under the definition of emergency services, such as
                conditions relating to coordinating care transitions to participating
                providers and facilities. The Departments also solicit comments on
                [[Page 36882]]
                what guidelines, beyond state laws regarding informed consent, may be
                needed to determine when an individual is in a condition to receive the
                written notice and provide consent. For example, are standards needed
                to account for individuals who are experiencing severe pain,
                intoxication, incapacitation, or dementia after being stabilized
                following an emergency medical condition?
                iii. Non-Emergency Services Performed by Nonparticipating Providers at
                Participating Health Care Facilities
                 Section 9816(b) of the Code, section 716(b) of ERISA, section
                2799A-1(b) of the PHS Act, and these interim final rules, apply
                surprise billing protections in the case of non-emergency services
                furnished by nonparticipating providers during a visit by a
                participant, beneficiary, or enrollee at a participating health care
                facility, unless the notice and consent requirements, as specified in
                these interim final rules, have been met.
                 Specifically, if a group health plan, or a health insurance issuer
                offering group or individual health insurance coverage, provides or
                covers benefits with respect to items and services (other than
                emergency services to which section 9816(a) of the Code, section 716(a)
                of ERISA, or section 2799A-1(a) of the PHS Act applies), the plan or
                issuer must cover such items and services furnished to a participant,
                beneficiary, or enrollee of the plan or coverage by a nonparticipating
                provider with respect to a visit at a participating health care
                facility in accordance with these interim final rules, including the
                requirements regarding cost sharing, payment amounts, and processes for
                resolving billing disputes described elsewhere in this preamble.
                iv. Health Care Facilities
                 These interim final rules, consistent with section 9816(b)(2)(A) of
                the Code, section 716(b)(2)(A) of ERISA, and section 2799A-1(b)(2)(A)
                of the PHS Act, define a participating health care facility, in the
                context of non-emergency services, as a health care facility that has a
                contractual relationship directly or indirectly with a group health
                plan or health insurance issuer offering group or individual health
                insurance coverage setting forth the terms and conditions on which a
                relevant item or service is provided to a participant, beneficiary, or
                enrollee under the plan or coverage, respectively. These interim final
                rules also specify that a single case agreement between a health care
                facility and a plan or issuer, used to address unique situations in
                which a participant, beneficiary, or enrollee requires services that
                typically occur out-of-network constitutes a contractual relationship
                for purposes of this definition, and is limited to the parties to the
                agreement with respect to the particular individual involved. Thus,
                when non-emergency services are furnished by a nonparticipating
                provider at a health care facility that has a single case agreement in
                place with respect to the individual being treated, as opposed to an
                agreement or contract that would apply to all the plan's or issuer's
                participants, beneficiaries, or enrollees, those non-emergency services
                would be subject to the protections described in 26 CFR 54.9816-5T, 29
                CFR 2590.716-5, and 45 CFR 149.120, as applicable, and the
                corresponding requirements on providers at 45 CFR 149.420. The
                Departments are of the view that it is reasonable that an individual
                would expect items and services delivered at a health care facility
                that has a single case agreement in place with respect to the
                individual's care to be delivered on an in-network basis. Thus, these
                interim final rules apply the same protections in this circumstance as
                would apply at health care facilities that participate in the plan or
                issuer's network.\32\ The facility is considered a participating
                facility only with respect to items and services furnished to the
                individual whose care is covered by the single case agreement.
                Similarly, these interim final rules define a participating emergency
                facility to include a facility that has a single case agreement in
                place with a plan or issuer with respect to a specific individual's
                care. The Departments seek comment on this approach.
                ---------------------------------------------------------------------------
                 \32\ In contrast, as discussed in section III.B.2.vi of this
                preamble, these interim final rules do not include negotiated rates
                under single-case agreements in the methodology for calculating the
                qualifying payment amount.
                ---------------------------------------------------------------------------
                 For this purpose, a health care facility described in the statute
                is each of the following, in the context of non-emergency services: (1)
                A hospital (as defined in 1861(e) of the Social Security Act); (2) a
                hospital outpatient department; (3) a critical access hospital (as
                defined in section 1861(mm)(1) of the Social Security Act); or (4) an
                ambulatory surgical center described in section 1833(i)(1)(A) of the
                Social Security Act.
                 In addition, section 9816(b)(2)(A)(ii)(V) of the Code, section
                716(b)(2)(A)(ii)(V) of ERISA, and section 2799A-1(b)(2)(A)(ii)(V) of
                the PHS Act authorize the Departments to designate additional
                facilities as health care facilities. The Departments solicit comments
                on other facilities that would be appropriate to designate as health
                care facilities. The Departments are interested in comments identifying
                types of facilities in which surprise bills frequently arise, and are
                particularly interested in comments regarding whether urgent care
                centers or retail clinics should be designated as health care
                facilities for purposes of these interim final rules.
                 The Departments recognize that state regulation of urgent care
                centers varies significantly, as does the type of services they are
                permitted to provide under state law. Under these interim final rules,
                emergency services provided at urgent care centers that are licensed in
                a manner that brings them within the definition of independent
                freestanding emergency department would be subject to cost-sharing and
                balance billing protections, among others. However, given significant
                variation in state law definitions, urgent care centers are not
                included within the definition of health care facilities, in the
                context of non-emergency services. Thus, in cases where non-emergency
                services are furnished at participating urgent care centers by
                nonparticipating providers, those services would not receive the
                protections under these interim final rules. However, the Departments
                are of the view that it is possible that individuals may be using
                urgent care centers (regardless of how they are licensed) in a similar
                way to how they use independent freestanding emergency departments, in
                which case it may be appropriate to designate urgent care centers as
                health care facilities. The Departments seek comment on the degree to
                which individuals may be using urgent care centers in a similar way to
                how they use independent freestanding emergency departments. The
                Departments seek data on how frequently surprise bills arise in the
                context of urgent care centers. The Departments also seek comment on
                whether plans and issuers generally contract separately with urgent
                care centers and the providers who work at the centers, and how
                frequently contracting practices result in nonparticipating providers
                furnishing services at participating urgent care centers. The
                Departments also seek comment on potential definitions of the term
                urgent care center.
                v. Items and Services Within the Scope of a Visit
                 In addition to items and services furnished by a provider at the
                facility, a ``visit'' to a participating health care facility includes
                the furnishing of equipment and devices, telemedicine services, imaging
                services, laboratory services, and preoperative and
                [[Page 36883]]
                postoperative services, regardless of whether the provider furnishing
                such items or services is at the facility. These services are not
                limited based on whether the provider furnishing the services is
                physically located at the facility. For example, if a sample is
                collected during an individual's hospital visit and sent to an off-site
                laboratory, the laboratory services would be considered to be part of
                the individual's visit to a participating health care facility, if
                laboratory services are covered by the plan or coverage. Similarly, if
                an individual receives a consultation with a specialist via
                telemedicine during a visit to a participating hospital, those
                telemedicine services would be considered part of the individual's
                visit to a participating health care facility. The statutory definition
                of ``visit'' also provides authority for the Departments to specify
                other items and services. The Departments solicit comments regarding
                other items and services that would be appropriate to include within
                the scope of a visit for purposes of these interim final rules.
                 The No Surprises Act and these interim final rules provide for
                exceptions to the balance billing prohibitions and cost-sharing
                requirements if the participant, beneficiary, or enrollee is provided a
                compliant written notice and consents to receive such services from a
                nonparticipating provider at a participating health care facility.
                However, these exceptions do not apply with respect to certain
                ancillary services (in the context of non-emergency services) and other
                services under certain conditions, as discussed later in this preamble.
                vi. Air Ambulance Services
                 Section 105 of the No Surprises Act added section 9817 of the Code,
                section 717 of ERISA, and section 2799A-2 of the PHS Act to address
                surprise air ambulance bills. These provisions apply in the case of a
                participant, beneficiary, or enrollee who receives services from a
                nonparticipating provider of air ambulance services, meaning medical
                transport by a rotary-wing air ambulance, as defined in 42 CFR 414.605,
                or fixed-wing air ambulance, as defined in 42 CFR 414.605. These
                interim final rules apply these provisions where a plan or coverage
                generally has a network of participating providers and provides or
                covers any benefits for air ambulance services, even if the plan or
                coverage does not have in its network any providers of air ambulance
                services. With respect to air ambulance services furnished by
                nonparticipating providers (including inter-facility transports), plans
                and issuers must comply with the requirements regarding cost sharing,
                payment amounts, and processes for resolving billing disputes described
                elsewhere in this preamble, if such services would be covered if
                provided by a participating provider with respect to such plan or
                coverage.
                2. Determination of the Cost-Sharing Amount and Payment Amount to
                Providers and Facilities
                i. In General
                 Under section 9816(a) of the Code, section 716(a) of ERISA, section
                2799A-1(a) of the PHS Act, and these interim final rules, if a plan or
                issuer provides or covers 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, the cost-
                sharing requirement for such services performed by a nonparticipating
                provider or nonparticipating emergency facility must not be greater
                than the requirement that would apply if such services were provided by
                a participating provider or a participating emergency facility.
                Additionally, if a plan or issuer provides or covers any benefits for
                non-emergency items and services furnished by a nonparticipating
                provider with respect to a visit at a participating health care
                facility, unless the provider has satisfied certain notice and consent
                criteria with respect to such items and services, the plan or issuer
                may not impose a cost-sharing requirement for such items and services
                that is greater than the cost-sharing requirement that would apply had
                such items or services been furnished by a participating provider.
                Similarly, if a plan or issuer provides or covers benefits for air
                ambulance services, the plan or issuer must cover such services from a
                nonparticipating provider in such a manner that the cost-sharing
                requirement with respect to such services must be the same requirement
                that would apply if such services were provided by a participating
                provider. For example, if a plan or issuer imposes a 20 percent
                coinsurance rate for emergency services from participating providers or
                participating emergency facilities, the plan or issuer may not impose a
                coinsurance rate on emergency services from nonparticipating providers
                or facilities that exceeds 20 percent. Stakeholders have reported that
                network participation rates are low among providers of air ambulance
                services. In instances where a plan or issuer does not have an
                established cost-sharing requirement that applies specifically to
                participating providers, the plan or issuer must calculate the cost-
                sharing amount using the generally applicable cost-sharing requirement
                for the relevant item or service under the plan or coverage.
                 Under sections 9816(a) and (b) and 9817(a) of the Code, sections
                716(a) and (b) and 717(a) of ERISA, sections 2799A-1(a) and (b) and
                2799A-2(a) of the PHS Act, and these interim final rules, any cost-
                sharing payments for emergency services, non-emergency services
                furnished by a nonparticipating provider in a participating health care
                facility, and air ambulance services furnished by a nonparticipating
                provider must be counted toward any in-network deductible or out-of-
                pocket maximums applied under the plan or coverage (including the
                annual limitation on cost sharing under section 2707(b) of the PHS Act)
                (as applicable), respectively (and these in-network deductibles and
                out-of-pocket maximums must be applied) in the same manner as if such
                cost-sharing payments were made with respect to services furnished by a
                participating provider or facility.
                ii. Cost-Sharing Amount
                 Section 9816(a)(1)(C)(iii) of the Code, section 716(a)(1)(C)(iii)
                of ERISA, section 2799A-1(a)(1)(C)(iii) of the PHS Act, and these
                interim final rules also specify that for emergency services furnished
                by a nonparticipating emergency facility, and for non-emergency
                services furnished by nonparticipating providers in a participating
                health care facility, cost sharing is generally calculated as if the
                total amount that would have been charged for the services by a
                participating emergency facility or participating provider were equal
                to the recognized amount for such services, as defined by the statute
                and in these interim final rules.
                 The ``recognized amount'' is: (1) An amount determined by an
                applicable All-Payer Model Agreement under section 1115A of the Social
                Security Act; (2) if there is no applicable All-Payer Model Agreement,
                an amount determined by a specified state law; or (3) if there is no
                applicable All-Payer Model Agreement or specified state law, the lesser
                of the amount billed by the provider or facility or the QPA, which
                under these interim final rules generally is the median of the
                contracted rates of the plan or issuer for the item or service in the
                geographic region.
                 By requiring plans and issuers to calculate the cost-sharing amount
                using the recognized amount, rather than the
                [[Page 36884]]
                amount the plan or issuer ultimately pays the nonparticipating provider
                or nonparticipating emergency facility for the furnished items or
                services, the No Surprises Act and these interim final rules limit the
                effect of provider-payer disputes about payment amounts on participant,
                beneficiary, or enrollee cost sharing. Under the statute and these
                interim final rules, the provider or facility and plan or issuer
                separately determine the total payment amount for the furnished items
                or services, but that amount generally does not affect the cost-sharing
                amount the individual must pay.
                 The Departments are aware that there may be some instances where a
                nonparticipating health care provider or facility might bill a plan or
                issuer for an item or service that is subject to these surprise billing
                protections in an amount less than the QPA. For example, this might be
                a relatively common occurrence for items whose patent expires after
                2019, in instances where the QPA is based off the median of the
                contracted rates from 2019. In these instances, assuming the plan or
                issuer would not pay more than the billed charge, calculating cost
                sharing based on the QPA would require a participant, beneficiary, or
                enrollee to pay a higher percentage in cost sharing than if the items
                or services had been furnished by a participating provider. However,
                section 9816(a)(1)(C)(ii) of the Code, section 716(a)(1)(C)(ii) of
                ERISA, and section 2799A-1(a)(1)(C)(ii) of the PHS Act expressly
                prohibit plans and issuers from applying a cost-sharing requirement
                that is greater than the requirement that would apply if such services
                were provided by a participating provider or a participating emergency
                facility. Therefore, under these interim final rules, in circumstances
                where a specified state law or All-Payer Model Agreement does not apply
                to determine the cost-sharing amount, cost sharing must be based on the
                lesser of the QPA or the amount billed by the provider for the item or
                service. The different methods for determining the recognized amount
                are discussed in separate sections of this section III.B.2 of this
                preamble.
                 With respect to air ambulance services furnished by
                nonparticipating providers, the recognized amount is not used for
                purposes of determining cost sharing. Rather, the statute specifies
                that the cost-sharing requirement with respect to such services must be
                the same requirement that would apply if such services were provided by
                a participating provider, and any coinsurance or deductible must be
                based on rates that would apply for such services if they were
                furnished by a participating provider. These interim final rules
                require that plans and issuers base any coinsurance and deductible for
                air ambulance services provided by a nonparticipating provider on the
                lesser of the QPA or the billed amount. The Departments have concluded
                that this policy is consistent with the statute's general intent to
                protect participants, beneficiaries, and enrollees from excessive
                bills, and to remove the individuals as much as possible from disputes
                between plans and issuers and providers of air ambulance services. In
                addition, using the QPA is one method of ensuring that any coinsurance
                or deductible is based on rates that would apply for the services if
                they were furnished by a participating provider, given that the QPA is
                generally based on median contracted rates, as opposed to rates charged
                by nonparticipating providers, and is one basis used for determining
                the cost-sharing amount in the context of emergency services and items
                and services furnished by nonparticipating providers at participating
                health care facilities.
                 As discussed in this preamble, the Airline Deregulation Act of 1978
                (ADA) broadly preempts state laws that relate to air ambulance
                providers, and the Departments are unaware of any instances in which an
                All-Payer Model Agreement or a specified state law might apply. In
                addition, since an All-Payer Model Agreement or a specified state law
                would not need to follow an approach based on rates that would apply
                for such services if they were furnished by a participating provider
                (for example, Medicare rates could be used instead), it is the
                Departments' view that Congress did not intend to apply the concept of
                the recognized amount to nonparticipating providers of air ambulance
                services. The Departments seek comment on any potential alternate
                approaches for calculating the cost-sharing amount for air ambulance
                services furnished by nonparticipating providers of air ambulance
                services.
                iii. Out-of-Network Rate
                 In addition to establishing requirements related to cost sharing,
                the No Surprises Act and these interim final rules also establish
                requirements related to the total amount paid by a plan or issuer for
                items and services subject to these provisions, referred to as the out-
                of-network rate. The plan or issuer must make a total payment equal to
                one of the following amounts, less any cost sharing from the
                participant, beneficiary, or enrollee: (1) An amount determined by an
                applicable All-Payer Model Agreement under section 1115A of the Social
                Security Act; (2) if there is no such applicable All-Payer Model
                Agreement, an amount determined by a specified state law; (3) in the
                absence of an applicable All-Payer Model Agreement or specified state
                law, if the plan or issuer and the provider or facility have agreed on
                a payment amount, the agreed on amount; or (4) if none of those three
                conditions apply, and the parties enter into the IDR process and do not
                agree on a payment amount before the date when the IDR entity makes a
                determination of the amount, the amount determined by the IDR entity.
                These four approaches for determining the out-of-network rate are
                discussed more fully later in this preamble.
                 The requirements related to cost sharing and to the out-of-network
                rate apply when a group health plan or coverage provides or covers
                benefits for services subject to these provisions. The Departments
                interpret this to mean that the requirements apply when a plan or
                issuer provides coverage for such items and services, pursuant to the
                terms of the plan or coverage, even in cases where an individual has
                not satisfied their deductible.\33\ Because the cost-sharing amount is
                calculated using the recognized amount (or for air ambulance services
                the lesser of the QPA or the billed amount) that is calculated
                separately from the determination of the out-of-network rate, these
                requirements may result in circumstances where a plan or issuer must
                make payment prior to an individual meeting their deductible.
                Specifically, where the surprise billing protections apply, and the
                out-of-network rate exceeds the amount upon which cost sharing is
                based, a plan or issuer must pay the provider or facility the
                difference between the out-of-network rate and the cost-sharing amount
                (the latter of which in this case would equal the recognized amount, or
                the lesser of the QPA or the billed amount), even in cases where an
                individual has not satisfied their deductible, as illustrated in the
                following example.
                ---------------------------------------------------------------------------
                 \33\ Absent the balance billing protections under the No
                Surprises Act and these interim final rules, the plan or issuer
                would not generally be expected to make a payment to the provider or
                facility prior to an individual satisfying the deductible.
                ---------------------------------------------------------------------------
                 Example. An individual is enrolled in a high deductible health plan
                with a $1,500 deductible and has not yet accumulated any costs towards
                the deductible at the time the individual receives emergency services
                at an out-of-network facility. The plan determines that the recognized
                amount for the services is $1,000. Because the
                [[Page 36885]]
                individual has not satisfied the deductible, the individual's cost-
                sharing amount is $1,000, which accumulates towards the deductible. The
                out-of-network rate is subsequently determined to be $1,500. Under the
                requirements of the statute and these interim final rules, the plan is
                required to pay the difference between the out-of-network rate and the
                cost-sharing amount. Therefore, the plan pays $500 for the emergency
                services, even though the individual has not satisfied the deductible.
                The individual's out-of-pocket costs are limited to the amount of cost-
                sharing originally calculated using the recognized amount (that is,
                $1,000).
                 Although such a payment would generally cause a high deductible
                health plan to lose its status as a high deductible health plan, the No
                Surprises Act added section 223(c)(2)(F) to the Code to specify that a
                plan shall not fail to be treated as a high deductible health plan by
                reason of providing benefits for medical care in accordance with
                section 9816 or 9817 of the Code, section 716 or 717 of ERISA, or
                section 2799A-1 or 2799A-2 of the PHS Act (the provisions added by the
                No Surprises Act related to surprise medical and air ambulance bills),
                or any state law providing similar protections to individuals, prior to
                the satisfaction of the deductible.\34\
                ---------------------------------------------------------------------------
                 \34\ See section IV.A.5 of this preamble for a discussion of
                HHS-only interim final rules addressing catastrophic plans'
                compliance with these requirements.
                ---------------------------------------------------------------------------
                iv. Specified State Law
                 Under section 9816(a)(3)(I) of the Code, section 716(a)(3)(I) of
                ERISA, section 2799A-1(a)(3)(I) of the PHS Act, and these interim final
                rules, a specified state law is a state law that provides a method for
                determining the total amount payable under a group health plan or group
                or individual health insurance coverage to the extent the state law
                applies. This includes instances where the Departments have interpreted
                this term to include state laws where the state law applies because the
                state has allowed a plan that is not otherwise subject to applicable
                state law an opportunity to opt in to a program established under state
                law, subject to section 514 of ERISA, for an item or service furnished
                by a nonparticipating provider or nonparticipating emergency facility.
                In cases where a specified state law applies, the recognized amount
                (the amount upon which cost sharing is based) and out-of-network rate
                for emergency and non-emergency services subject to the surprise
                billing protections is calculated based on such specified state law.
                 In order for a state law to determine the recognized amount or out-
                of-network rate, any such law must apply to: (1) The plan, issuer, or
                coverage involved, including where a state law applies because the
                state has allowed a plan that is not otherwise subject to applicable
                state law an opportunity to opt in, subject to section 514 of ERISA;
                (2) the nonparticipating provider or nonparticipating emergency
                facility involved (and in the case of state out-of-network rate laws,
                the nonparticipating provider of air ambulance services involved); and
                (3) the item or service involved. In instances where a state law does
                not satisfy all of these criteria, the state law does not apply to
                determine the recognized amount or out-of-network rate. For example,
                where a particular state surprise billing law that governs the
                recognized amount and out-of-network rate applies to a particular plan
                or coverage but does not apply to nonparticipating neonatologists, who
                provide a specified ancillary service under section 2799B-2(b)(2) of
                the PHS Act, the consumer protections under federal law would determine
                the recognized amount and out-of-network rate with respect to
                neonatology services while the state law would apply with respect to
                other provider specialties covered under that state law. Similarly,
                where a state's surprise billing laws apply only to health maintenance
                organizations (HMOs), federal protections against surprise billing
                would govern with respect to other types of coverage while the state
                protections would apply to HMOs for purposes of determining the
                recognized amount and out-of-network rate.
                 The same definition of ``out-of-network rate''--including the
                reference to specified state laws--applies to air ambulance services as
                to other services. The Departments note, however, that the ADA states
                in relevant part: ``. . . a State, political subdivision of a State, or
                political authority of at least 2 States may not enact or enforce a
                law, regulation, or other provision having the force and effect of law
                related to a price, route, or service of an air carrier that may
                provide air transportation under this subpart.'' \35\ Assuming that a
                provider of air ambulance services is an ``air carrier'' covered by
                this provision, as is typical,\36\ the provision preempts state laws
                that would limit the amount of payment that the provider of air
                ambulance services would otherwise be entitled to receive.\37\ Given
                the applicability of the ADA, the Departments are not aware of any
                state laws that would meet the criteria to set the out-of-network rate
                for nonparticipating providers of air ambulance services when providing
                services subject to the protections in the No Surprises Act.
                ---------------------------------------------------------------------------
                 \35\ 49 U.S.C. 41713(b).
                 \36\ An air ambulance provider is a covered ``air carrier'' if
                it has economic authority from the Department of Transportation to
                provide interstate air transportation. Most air ambulance providers
                have such authority under the provisions of 14 CFR part 298. See,
                e.g., Scarlett v. Air Methods Corp., 922 F.3d 1053 (10th Cir. 2019);
                Air Evac EMS v. Cheatham, 910 F.3d 751 (4th Cir. 2018).
                 \37\ See, e.g., Guardian Flight LLC v. Godfread, 991 F.3d 916,
                921 (8th Cir. 2021) (holding that ADA preempted state law
                prohibiting out-of-network air ambulance providers from balance
                billing and requiring them to accept amounts paid by insurers);
                Bailey v. Rocky Mountain Holdings, LLC, 889 F.3d 1259, 1269-72 (11th
                Cir. 2018) (holding that ADA preempted state law that prohibited air
                ambulance providers from collecting more than amount specified in
                fee schedule).
                ---------------------------------------------------------------------------
                 The Departments also seek comment on whether health insurance
                issuers, health care providers, or health care facilities, in instances
                where they are not otherwise subject to a specified state law that
                provides for a method for determining the total amount payable under a
                group health plan or group or individual health insurance coverage,
                should have an opportunity, for purposes of these interim final rules,
                to opt in to a program established under state law, with respect to an
                item or service furnished by a nonparticipating provider or
                nonparticipating emergency facility. The Departments seek comment on
                whether this approach would allow for more flexibility for state laws
                to apply when, for example, by their terms, they apply to the health
                insurance issuer and item and service in question, but not to the
                provider; whether an issuer, provider, or facility would still be
                subject to any specified state laws in their ``home'' state if they opt
                in to a program established under another state's law; and whether an
                issuer, provider, or facility should be permitted to opt in on an
                episodic basis. The Departments are concerned that allowing providers
                and facilities to opt in to a program established under state law could
                increase health care prices if providers and facilities selectively opt
                in to state programs that favor providers and facilities in the
                determination of the out-of-network rate. The Departments seek comment
                on the potential impact of expanding the ability to opt in to a state
                program to providers and facilities. The Departments specifically seek
                comment from health insurance issuers, health care providers, or health
                care facilities located within or serving
                [[Page 36886]]
                underserved and rural communities, and other communities facing a
                shortage of providers on the impact of these provisions on services,
                coverage, and payment for and within medically underserved, rural, and
                urban communities.
                a. State Law Interaction With ERISA
                 Under the general preemption clause of section 514(a) of ERISA,
                state laws are preempted to the extent that they ``relate'' to employee
                benefit plans subject to title I of ERISA. There are, however, a number
                of exceptions to this broad preemption provision. Section 514(b)(2)(A),
                referred to as the ``savings clause,'' provides in pertinent part that
                ``nothing in this title (title I of ERISA) shall be construed to exempt
                or relieve any person from any law of any State which regulates
                insurance. . . .'' Additionally, the preemption provisions of section
                731 of ERISA (implemented in 29 CFR 2590.731(a)) apply so that the
                requirements of part 7 of ERISA are not to be ``construed to supersede
                any provision of state law which establishes, implements, or continues
                in effect any standard or requirement solely relating to issuers in
                connection with group health insurance coverage except to the extent
                that such standard or requirement prevents the application of a
                `requirement' of a federal standard.'' The conference report
                accompanying the Health Insurance Portability and Accountability Act of
                1996 (HIPAA), which applied this preemption standard to state laws with
                respect to its title I health insurance reform provisions, indicates
                that this preemption is intended to be the ``narrowest'' preemption of
                states' laws.\38\ States may therefore continue to apply state law
                requirements to issuers except to the extent they prevent the
                application of ERISA requirements. Additionally, states have
                significant latitude to impose requirements on issuers that are more
                restrictive than the federal law. State laws that impose comparable or
                additional requirements on health insurance issuers would generally
                constitute a ``specified state law'' notwithstanding section 514 of
                ERISA and would continue to apply.
                ---------------------------------------------------------------------------
                 \38\ See House Conf. Rep. No. 104-736, at 205, reprinted in 1996
                U.S. Code Cong. & Admin. News 2018.
                ---------------------------------------------------------------------------
                 While section 514(b)(2)(A) saves from ERISA preemption state laws
                regulating insurance, section 514(b)(2)(B) of ERISA, referred to as the
                ``deemer clause,'' provides that a state law ``purporting to regulate
                insurance'' generally cannot deem an employee benefit plan to be an
                insurance company (or in the business of insurance) for the purpose of
                regulating such a plan as an insurance company (section 514(b)(6)(A)
                creates a partial exception to the deemer clause for employee welfare
                benefit plans that are also multiple employer welfare arrangements
                (MEWAs)). Thus, to the extent that a state law has a ``reference to''
                or an impermissible connection with ERISA plans (such as laws that
                govern the payment of benefits), these laws are preempted, to the
                extent they apply to self-insured plans sponsored by private
                employers.\39\ However, section 514 of ERISA does not prevent states
                from expanding access to a state program and allowing self-insured,
                ERISA-covered plans to choose to voluntarily comply with it. For
                example, the Departments allowed such plans to comply with their
                obligations for external review under section 2719 of the PHS Act by
                voluntarily opting in to the state external review process.\40\
                Similarly, these interim final rules allow self-insured plans
                (including non-federal governmental plans) to voluntarily opt in to
                state law that provides for a method for determining the cost-sharing
                amount or total amount payable under such a plan, where a state has
                chosen to expand access to such plans, to satisfy their obligations
                under section 9816(a)-(d) of the Code, section 716(a)-(d) of ERISA, and
                section 2799A-1(a)-(d) of the PHS Act. A group health plan that opts in
                to such a state law must do so for all items and services to which the
                state law applies. Under these interim final rules, a self-insured plan
                that has chosen to opt in to a state law must prominently display in
                its plan materials describing the coverage of out-of-network services a
                statement that the plan has opted in to a specified state law, identify
                the relevant state (or states), and include a general description of
                the items and services provided by nonparticipating facilities and
                providers that are covered by the specified state law.
                ---------------------------------------------------------------------------
                 \39\ See Gobeille v. Liberty Mutual Ins. Co. 577 U.S. 312
                (2015); Egelhoff v. Egelhoff, 532 U.S. 141 (2001).
                 \40\ See, e.g., Technical Release 2010-01; 76 FR 37208, 37211
                fn. 13 (June 24, 2011).
                ---------------------------------------------------------------------------
                b. Examples Involving Specified State Laws
                 The following examples illustrate how state laws may or may not
                apply. In each example, assume there is no applicable All-Payer Model
                Agreement that would determine the recognized amount or out-of-network
                rate.
                 Example 1. (i) Facts. A health insurance issuer licensed in State A
                covers a specific non-emergency service that is provided to an enrollee
                by a nonparticipating provider in a participating health care facility,
                both of which are also licensed in State A. State A has a law that
                prohibits balance billing for non-emergency services provided to
                individuals by nonparticipating providers in a participating health
                care facility, and provides for a method for determining the cost-
                sharing amount and total amount payable. The state law applies to
                health insurance issuers and providers licensed in State A. The state
                law also applies to the type of service provided.
                 (ii) Conclusion. In this Example 1, State A's law would apply to
                determine the recognized amount and the out-of-network rate.
                 Example 2. (i) Facts. Same facts as Example 1, except that the
                nonparticipating provider and participating health care facility are
                located and licensed in State B. State A's law does not apply to the
                provider, because the provider is licensed and located in State B.
                 (ii) Conclusion. In this Example 2, State A's law would not apply
                to determine the recognized amount and out-of-network rate. Instead,
                the lesser of the billed amount or QPA would apply to determine the
                recognized amount, and either an amount determined through agreement
                between the provider and issuer or an amount determined by an IDR
                entity would apply to determine the out-of-network rate.
                 Example 3. (i) Facts. An individual receives emergency services at
                a nonparticipating hospital located in State A. The emergency services
                furnished include post-stabilization services, as described in 26 CFR
                54.9816-4T(c)(2)(ii), 29 CFR 2590.716-4(c)(2)(ii), and 45 CFR
                149.110(c)(2)(ii). The individual's coverage is through a health
                insurance issuer licensed in State A, and the coverage includes
                benefits with respect to services in an emergency department of a
                hospital. State A has a law that prohibits balance billing for
                emergency services provided to an individual at a nonparticipating
                hospital located in State A and provides a method for determining the
                cost-sharing amount and total amount payable in such cases. The law
                applies to issuers licensed in State A. However, State A's law has a
                definition of emergency services that does not include post-
                stabilization services.
                 (ii) Conclusion. In this Example 3, State A's law would apply to
                determine the cost-sharing amount and out-of-network rate for the
                emergency services, as defined under State A's law. State A's
                [[Page 36887]]
                law would not apply for purposes of determining the cost-sharing amount
                and out-of-network rate for the post-stabilization services. Instead,
                the lesser of the QPA or billed amount would apply to determine the
                recognized amount, and either an amount determined through agreement
                between the hospital and issuer or an amount determined by an IDR
                entity would apply to determine the out-of-network rate, with respect
                to post-stabilization services.
                 Example 4. (i) Facts. A self-insured plan, subject to ERISA, covers
                a specific non-emergency service that is provided to a participant by a
                nonparticipating provider in a participating health care facility, both
                of which are licensed in State A. State A has a law that prohibits
                balance billing for non-emergency services provided to individuals by
                nonparticipating providers in a participating health care facility, and
                provides for a method for determining the cost-sharing amount and total
                amount payable. The law applies to health insurance issuers and
                providers licensed in State A, and provides that plans that are not
                otherwise subject to the law may opt in. The law also applies to the
                type of service provided. The self-insured plan has opted in.
                 (ii) Conclusion. In this Example 4, State A's law would apply to
                determine the recognized amount and the out-of-network rate.
                 The Departments are of the view that it would be uncommon for laws
                of more than one state to each apply to the same health insurance
                issuer, and to the same provider for a particular item or service.
                Therefore, the Departments do not foresee many instances where there
                might be a question as to which state's law applies to determine the
                recognized amount or out-of-network rate. However, in such uncommon
                scenarios, one approach might be for the states involved to make that
                decision. Another approach might be that the law enacted by the state
                in which the service is provided would apply. Yet another approach
                would be for the QPA to apply to determine the recognized amount, and
                either a negotiated amount or an amount determined by an IDR entity to
                apply to determine the out-of-network rate. The Departments seek
                comment on these and any other approaches for resolving this choice-of-
                law question. The Departments also seek comment on how states have
                handled such questions prior to the enactment of the No Surprises Act,
                should these types of conflicts exist.
                 The Departments are of the view that Congress intended that where
                state law provides a method for determining the total amount payable
                under a plan or coverage, the state law regarding balance billing would
                govern, rather than the alternative method for determining the out-of-
                network rate under the No Surprises Act. The Departments interpret the
                statutory phrase ``a State law that provides for a method for
                determining the total amount payable under such a plan, coverage, or
                issuer, respectively'' broadly as referring not only to state laws that
                set a mathematical formula for determining the out-of-network rate, or
                that set a predetermined amount for an out-of-network item or service.
                Rather, the Departments interpret that language to also include, for
                example, state laws that require or permit a plan or issuer and a
                provider or facility to negotiate, and then to engage in a state
                arbitration process to determine the out-of-network rate. Such state
                laws provide a process for determining the total amount payable, and in
                such instances, the timeframes and processes under such a state law
                related to negotiations and arbitration would apply, as opposed to the
                timeframes and IDR process under the No Surprises Act.
                 In addition, the Departments are of the view that Congress did not
                intend for the No Surprises Act to preempt provisions in state balance
                billing laws that address issues beyond how to calculate the cost-
                sharing amount and out-of-network rate. To the extent state laws do not
                prevent the application of a federal requirement or prohibition on
                balance billing, the Departments are of the view that such state laws
                are consistent with the statutory framework of the No Surprises Act and
                would not be preempted.\41\ This view extends to any state law that
                provides balance billing protections beyond what these interim final
                rules provide. In fact, Congress specifically indicated that such state
                balance billing laws may continue in effect along with the balance
                billing protections set forth in the statute, by requiring in new
                section 2799B-3 of the PHS Act that providers must disclose to
                participants, beneficiaries, and enrollees information about federal
                balance billing protections, plus any other protections that apply
                under state law. A more detailed discussion of the disclosure
                requirements appears in section IV.A.3 of this preamble, which
                discusses the provisions codified in 45 CFR 149.430.
                ---------------------------------------------------------------------------
                 \41\ Section 731(a) of ERISA and section 2724(a) of the PHS Act.
                As noted above, the HIPAA conference report indicates that this
                preemption standard is intended to be the ``narrowest'' preemption
                of states' laws. See House Conf. Rep. No. 104-736, at 205, reprinted
                in 1996 U.S. Code Cong. & Admin. News 2018.
                ---------------------------------------------------------------------------
                v. All-Payer Model Agreements
                 As described earlier, in instances where an All-Payer Model
                Agreement is applicable, the recognized amount (the amount upon which
                cost sharing is based with respect to items and services furnished by
                nonparticipating emergency facilities, and nonparticipating providers
                of nonemergency items and services in participating facilities) and the
                out-of-network rate are determined using the amount that the state
                approves under the All-Payer Model Agreement for such items or
                services.
                 An All-Payer Model Agreement is an agreement between the Centers
                for Medicare & Medicaid Services (CMS) and a state to test and operate
                systems of all-payer payment reform for the medical care of residents
                of the state, under the authority granted under section 1115A the
                Social Security Act. Under the terms of section 1115A of the Social
                Security Act, such Agreements may waive specific provisions of titles
                XI and XVIII and of sections 1902(a)(1), 1902(a)(13),
                1903(m)(2)(A)(iii), and 1934 (other than subsections (b)(1)(A) and
                (c)(5) of such section) as may be necessary solely for the purposes of
                testing the Model. All-Payer Model Agreements can vary significantly by
                state, including in using different approaches for approving payment
                amounts for items or services covered by the Agreements. The
                Departments are of the view that it is important to maximally preserve
                states' abilities to test all-payer payment reform through these
                Agreements, including their abilities to do so using varied approaches
                to setting payment amounts. These interim final rules defer to the
                state to determine the circumstances under which, and how, it will
                approve an amount for an item or service under a payment system
                established by an All-Payer Model Agreement. Participating in an all-
                payer model governed by an All-Payer Model Agreement may be voluntary
                or mandatory for a given payer; the system of all-payer payment reform
                may apply statewide or only in certain regions, such as rural regions;
                and payments under the system of all-payer payment reform may apply
                only to certain providers or facilities and certain items and
                services.\42\ To account
                [[Page 36888]]
                for potential variations among All-Payer Model Agreements, the
                Departments are proposing to take a similar approach that these interim
                final rules establish with respect to state laws. Specifically, in
                order for an All-Payer Model Agreement to determine the recognized
                amount or out-of-network rate, any such Agreement must apply to the
                coverage involved; to the nonparticipating provider or nonparticipating
                emergency facility involved (and in the case of the out-of-network
                rate, to the nonparticipating provider of air ambulance services
                involved); and to the item or service involved. In instances where an
                All-Payer Model Agreement does not satisfy all of these criteria, the
                Agreement does not apply to determine the recognized amount or out-of-
                network rate, and, unless a specified state law applies, the recognized
                amount would be determined by the QPA (or the billed charge if less
                than the QPA), and the out-of-network rate would be the amount
                determined through agreement between the provider or facility and plan
                or issuer or the IDR process.
                ---------------------------------------------------------------------------
                 \42\ See, e.g., CMS. Vermont All-Payer ACO Model, (updated Apr.
                8, 2020) available at https://innovation.cms.gov/innovation-models/vermont-all-payer-aco-model; CMS. Pennsylvania Rural Health Model,
                (updated Jan. 1, 2021) available at https://innovation.cms.gov/innovation-models/pa-rural-health-model; CMS. Maryland Total Cost of
                Care Model available at https://innovation.cms.gov/innovation-models/md-tccm.
                ---------------------------------------------------------------------------
                 Under these interim final rules, an All-Payer Model Agreement is
                treated as applicable to a given provider or facility and plan or
                issuer if the terms of the Agreement, or any agreements described in
                that Agreement, are binding upon the provider, facility, plan, or
                issuer, which may occur through different mechanisms. For example,
                under the All-Payer Model Agreement for the Maryland Total Cost of Care
                Model and under the Maryland state all-payer law, all payers (including
                group health plans and health insurance issuers offering group or
                individual health insurance coverage) pay the amount determined under
                the Agreement with respect to hospital services covered by the
                Agreement.\43\ However, the Agreement generally does not apply to the
                amount paid to a provider, such as a physician, who furnishes services
                at a hospital. In Maryland, therefore, the recognized amount and out-
                of-network rate would be set by the All-Payer Model Agreement for all
                plans and issuers for hospital charges covered under the Agreement.
                But, the All-Payer Model Agreement would generally not be used to set
                the recognized amount or out-of-network rate with respect to a
                nonparticipating provider's charges, unless the All-Payer Model
                Agreement, or any agreements described in that Agreement, specify the
                payment amount in a particular instance.
                ---------------------------------------------------------------------------
                 \43\ See CMS. Maryland Total Cost of Care Model, (updated Oct.
                22, 2020) available at https://innovation.cms.gov/innovation-models/md-tccm. Under Maryland law, hospitals regulated by the Maryland
                Health Services Cost Review Commission (HSCRC) must charge payers
                the rates set the by HSCRC, and payers, including group health plans
                and issuers offering individual or group health insurance, must pay
                the rates set by HSCRC. Maryland Code, Health-General Article
                Sec. Sec. 19-212 and 19-219(a)(3) and (b)(2)(i) and Maryland Code,
                Insurance Article Sec. 15-604.
                ---------------------------------------------------------------------------
                 Although under state law plans and issuers in Maryland do not have
                discretion regarding whether to participate in the all-payer rate
                setting system under the Maryland Total Cost of Care Model,
                participation in other state-based models governed by All-Payer Model
                Agreements is voluntary. For example, under the All-Payer Model
                Agreement for the Vermont All-Payer Accountable Care Organization (ACO)
                Model, participation by providers, facilities, group health plans, and
                health insurance issuers is voluntary.\44\ To the extent that both the
                provider or facility and plan or issuer has opted to participate in the
                Vermont All-Payer ACO Model and the Vermont All-Payer Model Agreement,
                or an agreement described in that Agreement, applies to a specific item
                or service, then that All-Payer Model Agreement would determine the
                recognized amount and out-of-network rate. But, for example, if a plan
                has opted to participate, but the provider furnishing the service has
                not, then the All-Payer Model Agreement would not be used to determine
                either the recognized amount or out-of-network rate. Instead, if a
                state law is applicable, the state law would apply. If no state law is
                applicable, then the recognized amount would be determined using the
                QPA,\45\ and the out-of-network rate would be the amount agreed upon by
                the parties or determined through the IDR process established in the No
                Surprises Act, as discussed further elsewhere in this preamble.
                ---------------------------------------------------------------------------
                 \44\ https://innovation.cms.gov/innovation-models/vermont-all-payer-aco-model.
                 \45\ See prior explanation regarding the requirement that when
                the surprise billing protections apply, in the event the billed
                charge is less than the recognized amount, cost sharing would be
                based on the billed charge.
                ---------------------------------------------------------------------------
                vi. Methodology for Calculating the Qualifying Payment Amount
                 The No Surprises Act directs the Departments to establish through
                rulemaking the methodology that a group health plan or health insurance
                issuer offering group or individual health insurance coverage must use
                to determine the qualifying payment amount (QPA). As discussed earlier
                in this preamble, the No Surprises Act and these interim final rules
                require cost-sharing requirements imposed by plans and issuers in
                connection with emergency services furnished by a nonparticipating
                emergency facility or nonparticipating provider, or in connection with
                non-emergency services performed by nonparticipating providers at
                certain participating facilities to be based on the lesser of the
                billed charge or the QPA where an All-Payer Model Agreement under
                section 1115A of the Social Security Act or a specified state law does
                not apply. In addition, IDR entities are directed by statute to
                consider the QPA when selecting between the offer submitted by a plan
                or issuer and the offer submitted by a facility or provider in order to
                determine the total payment for emergency services furnished by a
                nonparticipating emergency facility or nonparticipating provider, or
                non-emergency services performed by nonparticipating providers at
                certain participating facilities that are items and services subject to
                the IDR process.
                 In general, under section 9816(a)(3)(E) of the Code, section
                716(a)(3)(E) of ERISA, and section 2799A-1(a)(3)(E) of the PHS Act, for
                a given item or service, the QPA is the median of the contracted rates
                recognized by the plan or issuer on January 31, 2019, for the same or
                similar item or service that is provided by a provider in the same or
                similar specialty and provided in a geographic region in which the item
                or service is furnished, increased for inflation. The median contracted
                rate is determined with respect to all group health plans of the plan
                sponsor or all group or individual health insurance coverage offered by
                the health insurance issuer that are offered in the same insurance
                market, consistent with the methodology established by the Departments.
                 The No Surprises Act specifies an alternative methodology for
                determining the QPA in cases where a plan or issuer has insufficient
                information to calculate a median contracted rate for an item or
                service. The statute, however, envisions that these alternative
                methodologies, such as use of a third-party database, will be used in
                only limited circumstances where the plan or issuer cannot rely on its
                contracted rates as a reflection of the market dynamics in a geographic
                region. Consistent with this statutory goal, these interim final rules
                generally seek to ensure that plans and issuers can meet the
                sufficient-information standard when determining the QPA and that use
                of alternative methodologies is minimized wherever possible.
                 The Departments seek comment on all aspects of the methodology
                established
                [[Page 36889]]
                in these interim final rules for determining the QPA. In particular,
                the Departments seek comment on whether there are any considerations or
                factors that are not sufficiently accounted for in the methodology
                established in these interim final rules; the impact of the methodology
                on cost sharing, payment amounts, and provider network participation;
                and whether there are areas where commenters believe additional
                rulemaking or guidance is necessary. The Departments also seek comment
                as to the impact of large consolidated health care systems on
                contracted rates, and the impact of such contracted rates on prices and
                the QPA. The Departments are concerned that the contracting practices
                of such health care systems could inflate the QPA, and seek comment on
                whether adjustments to the QPA methodology are needed.
                a. Median Contracted Rate
                 These interim final rules establish the methodology that plans and
                issuers must use to calculate the median of contracted rates. The plan
                or issuer will generally then apply an inflation adjustment to
                determine the QPA for items and services furnished in the relevant
                year.
                 In general, the median contracted rate for an item or service is
                calculated by arranging in order from least to greatest the contracted
                rates of all plans of the plan sponsor (or of the administering entity,
                if applicable) or all coverage offered by the issuer in the same
                insurance market for the same or similar item or service that is
                provided by a provider in the same or similar specialty or facility of
                the same or similar facility type and provided in the geographic region
                in which the item or service is furnished, and selecting the middle
                number. These interim final rules define each of the relevant terms, as
                discussed in more detail in this section of the preamble.
                 In determining the median contracted rate, the amount negotiated
                under each contract is treated as a separate amount. For example,
                assume the contracted rates for all plans of a sponsor in the same
                insurance market for a particular item or service provided by a
                provider in the same or similar specialty in a specified geographic
                region are $475, $490, and $510. The median contracted rate for this
                service is $490. If there are an even number of contracted rates, the
                median contracted rate is the average of the middle two contracted
                rates. If, in the previous example, there were a fourth contracted rate
                in the amount of $515, the median contracted rate would be the average
                of the two middle amounts ($490 and $510), or $500 (($490+$510)2). If
                the same amount is paid under two or more separate contracts, each
                contract is counted separately. Thus, in the previous example, if there
                were a fifth contracted rate also in the amount of $515, the median
                contracted rate would be $510, since there are two contracted rates
                below that amount ($475 and $490) and two contracted rates above that
                amount ($515 and $515).
                Contracted Rate
                 The interim final rules define a ``contracted rate'' as the total
                amount (including cost sharing) that a group health plan or health
                insurance issuer has contractually agreed to pay a participating
                provider, facility, or provider of air ambulance services for covered
                items and services, whether directly or indirectly, including through a
                third-party administrator or pharmacy benefit manager.\46\
                ---------------------------------------------------------------------------
                 \46\ This definition is substantially similar to the definition
                of ``negotiated rate'' used for purposes of the transparency in
                coverage regulations at 26 CFR 54.9815-2715A1(a)(2)(xvi), 29 CFR
                2590.715-2715A1(a)(2)(xvi), and 45 CFR 147.210(a)(2)(xvi).
                ---------------------------------------------------------------------------
                 The No Surprises Act envisions that each contracted rate for a
                given item or service be treated as a single data point when
                calculating a median contracted rate. Therefore, if a plan or issuer
                has a contract with a provider group or facility, the rate negotiated
                with that provider group or facility under the contract is treated as a
                single contracted rate, if the same rate applies to all providers of
                such provider group or facility under the single contract. Likewise,
                the rate negotiated under a contract constitutes a single contracted
                rate regardless of the number of claims paid at that contracted rate.
                However, if a plan or issuer has a contract with multiple providers,
                with separate negotiated rates with each particular provider for a
                given item or service, each unique contracted rate constitutes a single
                contracted rate for purposes of determining the median contracted
                rate.\47\ Further, if a plan or issuer has separate contracts with
                individual providers, the contracted rate under each such contract
                constitutes a single contracted rate (even if the same amount is paid
                to other providers under separate contracts).
                ---------------------------------------------------------------------------
                 \47\ If a plan or issuer has a contract with multiple providers,
                with separate negotiated rates with several subgroups of providers,
                each unique contracted rate will generally constitute a single
                contracted rate for purposes of determining the median contracted
                rate. However, as discussed later in this section of the preamble,
                these interim final rules specify that if a plan or issuer has
                contracted rates that vary based on provider specialty for a service
                code, the median contracted rate is calculated separately for each
                provider specialty, as applicable. In such cases, the QPA for the
                particular item or service would take into account only the
                contracted rates for the applicable provider specialty, and would
                disregard other unique contracted rates under the same contract.
                ---------------------------------------------------------------------------
                 The Departments understand that some plans or issuers may rent
                provider networks or otherwise contract with third parties to manage
                provider networks. In these situations, contracted rates between
                providers and the entity responsible for managing the provider network
                on behalf of a plan or issuer would be treated as the plan's or
                issuer's contracted rates for purposes of calculating the QPA. The
                Departments seek comment on whether additional guidance or special
                rules are needed regarding how to define a contract in this situation.
                 The Departments also understand that plans and issuers sometimes
                enter into special agreements with providers and facilities that
                generally are not otherwise contracted to participate in any of the
                networks of the plan or issuer. For example, a plan or issuer may
                negotiate an ad hoc arrangement with a nonparticipating provider or
                facility to supplement the network of the plan or coverage for a
                specific participant, beneficiary, or enrollee in unique circumstances.
                These interim final rules specify that solely for purposes of the
                definition of contracted rate, a single case agreement, letter of
                agreement, or other similar arrangement between a plan or issuer and a
                provider, facility, or provider of air ambulance services does not
                constitute a contract, and the rate paid under such an agreement should
                not be counted among the plan's or issuer's contracted rates. The term
                ``contracted rate'' refers only to the rate negotiated with providers
                and facilities that are contracted to participate in any of the
                networks of the plan or issuer under generally applicable terms of the
                plan or coverage and excludes rates negotiated with other providers and
                facilities. The Departments are of the view that this definition most
                closely aligns with the statutory intent of ensuring that the QPA
                reflects market rates under typical contract negotiations.\48\
                ---------------------------------------------------------------------------
                 \48\ In contrast, as discussed earlier in this preamble, these
                interim final rules specify that a single case agreement constitutes
                a contractual relationship for purposes of the definition of
                participating health care facility and participating emergency
                facility. The Departments are of the view that it is reasonable that
                an individual would expect items and services delivered at a health
                care facility that has a single case agreement in place with respect
                to the individual's care to be delivered on an in-network basis, and
                therefore, that the balance billing protections should apply.
                ---------------------------------------------------------------------------
                Insurance Market
                 In calculating the median contracted rate for a given item or
                service, the plan
                [[Page 36890]]
                or issuer must take into account the contracted rates under all group
                health plans of the sponsor or all group or individual health insurance
                coverage offered by the issuer that are offered in the same insurance
                market.\49\ The term ``insurance market'' for purposes of these interim
                final rules means one of the following: The individual market, small
                group market, or large group market (each as defined under section
                2791(e) of the PHS Act). The relevant insurance market is determined
                irrespective of the state. For example, in calculating the QPA for an
                item or service furnished to an enrollee in individual health insurance
                coverage, an issuer must take into account the contracted rates with
                providers or facilities in the applicable geographic region across the
                issuer's individual market offerings, inclusive of contracted rates for
                all individual health insurance coverage offered by the issuer in all
                states in which the issuer offers coverage in the individual market.
                ---------------------------------------------------------------------------
                 \49\ The term ``health insurance issuer'' has the meaning given
                the term in section 2791(b) of the PHS Act, which, in relevant part,
                defines a health insurance issuer as an entity that is licensed to
                engage in the business of insurance in a state. Thus, an issuer is
                the licensed entity and the contracted rates of separate licensees
                under the same holding company are not taken into account.
                ---------------------------------------------------------------------------
                 With respect to self-insured group health plans, these interim
                final rules define the term ``insurance market'' to mean all self-
                insured group health plans (other than account-based plans and plans
                that consist solely of excepted benefits) of the plan sponsor, or at
                the option of the plan sponsor, all self-insured group health plans
                administered by the same entity (including a third-party administrator
                contracted by the plan), to the extent otherwise permitted by law, that
                is responsible for calculating the QPA on behalf of the plan. The
                Departments understand that many self-insured group health plans are
                administered by entities other than the plan sponsor (such as a third-
                party administrator contracted by the plan) that would be responsible
                for calculating the QPA on behalf of the sponsor. To reduce the burden
                imposed on sponsors of self-insured group health plans, these interim
                final rules permit sponsors of self-insured group health plans to allow
                their third-party administrators to determine the QPA for the sponsor
                by calculating the median contracted rate using the contracted rates
                recognized by all self-insured group health plans administered by the
                third-party administrator (not only those of the particular plan
                sponsor). Under this approach, the Departments anticipate there will be
                fewer instances where a self-insured group health plan sponsor will
                lack sufficient information to calculate a median contracted rate for
                an item or service.
                 The Departments seek comment on the definition of insurance market
                with respect to self-insured group health plans and whether any
                contractual or other issues may prevent an entity, such as a third-
                party administrator, from using contracted rates from the different
                self-insured plans it administers to calculate the QPA for a particular
                self-insured group health plan. DOL also seeks comment on the ability
                of self-insured group health plan fiduciaries to monitor the
                calculation of the QPA by the administering entities for compliance
                with the applicable requirements (for example, by ensuring the entities
                are using the correct contracted rates).
                 The Departments have determined that including rates negotiated
                under other more limited forms of coverage, such as excepted benefits,
                short-term, limited-duration insurance, and account-based plans,
                including health reimbursement arrangements, could skew the calculation
                of the median contracted rate, and these forms of coverage should not
                be included in the definition of the applicable insurance market.
                Furthermore, the definition of ``qualifying payment amount'' under
                section 2799A-1(a)(3)(E)(i)(I) of the PHS Act refers to individual
                health insurance coverage, and the term individual health insurance
                coverage, as defined under section 2791(b)(5) of the PHS Act, excludes
                short-term, limited-duration insurance.\50\ Therefore, under these
                interim final rules, when referring to coverage offered by an issuer
                within the same insurance market for purposes of determining the QPA,
                the individual market excludes short-term, limited-duration insurance
                (as defined in 26 CFR 54.9801-2, 29 CFR 2590.701-2, and 45 CFR
                144.103). In addition, under these interim final rules, all markets
                exclude coverage that consists solely of excepted benefits (as
                described in section 9832 of the Code, section 733 of ERISA, and
                section 2791 of the PHS Act). While excepted benefits can be offered in
                the individual or group markets, they are exempt from the federal
                insurance market reforms,\51\ and Congress amended the statutory
                exemption for these products to include the additional coverage
                provisions established under new Part D of title XXVII of the PHS
                Act.\52\ Account-based plans, including health reimbursement
                arrangements as described in 26 CFR 54.9815-2711(d)(6)(i), 29 CFR
                2590.715-2711(d)(6)(i), and 45 CFR 147.126(d)(6)(i), make
                reimbursements subject to a maximum fixed dollar amount for a period,
                such that the benefit design of these coverage options makes concepts
                related to surprise billing and choice of health care professionals
                inapplicable. Therefore, under these interim final rules, for purposes
                of calculating the QPA, all group markets similarly exclude coverage
                provided under account-based plans.
                ---------------------------------------------------------------------------
                 \50\ Since short-term, limited duration insurance is not
                individual health insurance coverage, it is also generally not
                subject to the federal individual market reforms. See, e.g., 81 FR
                75316 at 75317 (Oct. 31, 2016) and 83 FR 38212 at 38213 (Aug. 3,
                2018).
                 \51\ Section 9831 of the Code, section 732 of ERISA, and
                sections 2722 and 2763 of the PHS Act.
                 \52\ These amendments add the phrase ``and Part D'' to section
                2722(b), (c)(1), (c)(2), and (c)(3) of the PHS Act.
                ---------------------------------------------------------------------------
                 The Departments also clarify that any plan or coverage that is not
                a ``group health plan'' or ``group or individual health insurance
                coverage'' offered by a ``health insurance issuer,'' as those terms are
                defined in the Code, ERISA, and the PHS Act, such as a Medicare
                Advantage or Medicaid managed care organization plan, must also not be
                included in any insurance market for purposes of determining the QPA.
                This approach is consistent with the statutory requirement that the
                median contracted rate is determined with respect to all ``group health
                plans'' of the sponsor or all ``group or individual health insurance
                coverage'' offered by a health insurance issuer in the same insurance
                market.
                Same or Similar Item or Service
                 Section 9816(a)(3)(E) of the Code, section 716(a)(3)(E) of ERISA,
                section 2799A-1(a)(3)(E) of the PHS Act, and these interim final rules
                provide that a plan or issuer must calculate the median contracted rate
                for an item or service using contracted rates for the same or similar
                item or service. Under the interim final rules, the term ``same or
                similar item or service'' means a health care item or service billed
                under the same service code, or a comparable code under a different
                procedural code system. Service code means the code that describes an
                item or service, including a Current Procedural Terminology (CPT),
                Healthcare Common Procedure Coding System (HCPCS), or Diagnosis-Related
                Group (DRG) code. A service code is a unique identifier, typically
                consisting of a string of numeric digits or alphanumeric characters,
                that corresponds to a standardized description, which is used
                [[Page 36891]]
                to identify with specificity the item or service that was furnished to
                a patient. Different codes may be assigned to the same general service
                on the basis of certain variations in the provider's method or
                approach, the complexity of the procedure or medical decision-making,
                and patient acuity level. Payers, providers, and facilities understand
                these service codes and commonly use them for billing and paying claims
                (including for both individual items and services, and for items and
                services provided under a bundled payment arrangement). Thus, defining
                ``same or similar item or service'' by service code will make it easier
                for plans and issuers to calculate the QPA, and for providers and
                facilities to understand the QPA.
                 These interim final rules include specific requirements to account
                for modifiers (when applicable), which are codes applied to the service
                code that provide a more specific description of the furnished item or
                service and that may adjust the payment rate or affect the processing
                or payment of the code billed. For example, modifiers include hospital
                revenue codes, which indicate the department or place in the hospital
                in which a procedure or treatment is performed, as well as codes
                indicating whether services or procedures were performed by certain
                types of providers, such as physician assistants, nurse practitioners,
                certified registered nurse anesthetists, or assistant surgeons. In
                addition, modifiers can be used to indicate that the work required to
                provide a service in a particular instance was significantly greater--
                or significantly less--than the service typically requires. The
                Departments are of the view that it is important that the QPA
                methodology account for modifiers that affect payment rates under
                contracts with participating providers and facilities.
                 Under the methodology established in these interim final rules,
                plans and issuers must calculate separate median contracted rates for
                CPT code modifiers that distinguish the professional services component
                (``26'') from the technical component (``TC''). This will result in
                separate median contracted rates being calculated for services when
                billed by a facility versus a provider. In addition, where a plan's or
                issuer's contracted rates otherwise vary based on applying a modifier
                code, the plan or issuer must calculate a separate median contracted
                rate for each such service code-modifier combination. Modifiers that do
                not cause contracted rates to vary must not be taken into account when
                calculating the median contracted rate. These rules are intended to
                ensure that if a plan or issuer adjusts contracted rates with
                participating providers and facilities based on modifier codes, those
                payment adjustments are appropriately reflected in the median
                contracted rate.
                Provider in the Same or Similar Specialty
                 These interim final rules specify that if a plan or issuer has
                contracted rates for a service code that vary based on provider
                specialty, the median contracted rate is calculated separately for each
                provider specialty, as applicable. These interim final rules define
                ``provider in the same or similar specialty'' as the practice specialty
                of a provider, as identified by the plan or issuer consistent with the
                plan's or issuer's usual business practice. This definition is intended
                to provide plans or issuers with the flexibility necessary to calculate
                the median contracted rate, relying on their contracting practices with
                participating providers. If a plan's or issuer's usual business
                practice for identifying a provider's practice specialty differs for
                contracting purposes and other business needs, the plan or issuer
                should use the method of identifying the practice specialty that it
                uses for contracting purposes.
                 The Departments considered requiring a plan or issuer to calculate
                separate median contracted rates for every provider specialty, but
                concluded that this approach would lead to more instances in which the
                plan or issuer would not have sufficient information to calculate the
                QPAs using its contracted rates. In addition, the Departments
                understand that not all plans or issuers vary contracted rates by
                provider specialty, in which case requiring plans and issuers to
                calculate separate median contracted rates for each provider specialty
                would increase the burden associated with calculating the QPA without
                adding specificity to the QPA. Given that the No Surprises Act
                generally relies on using contracted rates to determine the QPA, the
                Departments conclude that plans and issuers should be required to
                calculate median contracted rates separately by provider specialty only
                where the plan or issuer otherwise varies its contracted rates based on
                provider specialty.
                 With respect to air ambulance services, all providers of air
                ambulance services (including inter-facility transports) are considered
                to be a single provider specialty for purposes of these interim final
                rules. The Departments understand that contracted rates may vary
                depending on whether the air ambulance services are provided using a
                fixed-wing or rotary-wing aircraft. However, these distinctions based
                on vehicle type are accounted for in the QPA methodology established
                under these interim final rules through the use of service codes that
                are specific to fixed-wing or rotary-wing aircraft. Therefore, the
                Departments anticipate that median contracted rates for fixed-wing and
                rotary-wing aircraft would be determined separately based on the
                requirement under these interim final rules that median contracted
                rates be based on the contracted rates for the same or similar item or
                service, and concluded that it would be redundant to require plans and
                issuers to also calculate separate median contracted rates on the basis
                of vehicle type.
                 The Departments also understand that hospital-based air ambulance
                providers sometimes have lower contracted rates than independent, non-
                hospital-based air ambulance providers. The Departments, however, are
                of the view that because participants, beneficiaries, and enrollees
                frequently do not have the ability to choose their air ambulance
                provider, they should not be required to pay higher cost-sharing
                amounts (such as coinsurance or a deductible) solely because the air
                ambulance provider assigned to them has negotiated higher contracted
                rates in order to cover its higher costs, or because it has a different
                revenue model, than other types of air ambulance providers. This
                approach is consistent with the approach these interim final rules take
                with respect to facilities, discussed in the following section of this
                preamble, which also generally does not provide for separate median
                contracted rates to be calculated based on characteristics of a
                particular facility. The Departments have concluded that this
                interpretation is consistent with the statute's intent to protect
                individuals from surprise medical bills.
                Facility of the Same or Similar Facility Type
                 If a plan or issuer has contracted rates for emergency services
                that vary based on the type of facility (that is, whether a facility is
                an emergency department of a hospital or an independent freestanding
                emergency department), the median contracted rate is calculated
                separately for each such facility type. Plans and issuers subject to
                the protections in the No Surprises Act are required to cover emergency
                services at both types of facilities. However, the Departments are
                aware that plans and issuers have not typically contracted with
                independent freestanding emergency departments, which may be a
                reflection of independent freestanding emergency departments'
                historical ability (prior to the enactment of the No Surprises Act) to
                charge higher rates for
                [[Page 36892]]
                services furnished on an out-of-network basis, and to balance bill
                enrollees when the charges were denied in part or in full.\53\ The
                Departments are also aware that there may be appreciable differences in
                the case-mix and level of patient acuity between these types of
                facilities.\54\ Therefore, where a plan or issuer has established
                contracts with both hospital emergency departments and independent
                freestanding emergency departments, and its contracts vary the payment
                rate based on the facility type, the median contracted rate is to be
                calculated separately for each facility type. The Departments are of
                the view that this approach will maintain the ability of plans and
                issuers to develop QPAs that are appropriate to the different types of
                emergency facilities specified by statute. The Departments seek comment
                on this approach, and whether it would be more appropriate for plans
                and issuers to always calculate separate QPAs for hospital emergency
                departments and independent freestanding emergency departments
                regardless of whether the plan or issuer varies the payment rate based
                on facility type, or whether a plan or issuer should never calculate
                separate QPAs for hospital emergency departments and independent
                freestanding emergency departments.
                ---------------------------------------------------------------------------
                 \53\ See Medicare Payment Advisory Commission, Report to the
                Congress: Medicare and the Health Care Delivery System, ch. 8,
                Stand-alone Emergency Departments, June 2017, available at http://www.medpac.gov/docs/default-source/reports/jun17_ch8.pdf (last
                visited June 19, 2021).
                 \54\ See id.
                ---------------------------------------------------------------------------
                 However, these interim final rules do not allow plans or issuers to
                separately calculate a median contracted rate based on other
                characteristics of facilities that might cause contracted rates to
                vary, such as whether a hospital is an academic medical center or
                teaching hospital. Given that participants, beneficiaries, and
                enrollees with emergency medical conditions typically go (or are taken)
                to the nearest or most convenient emergency department, the Departments
                are of the view that, individuals generally should not be required to
                pay higher cost sharing (such as coinsurance or a deductible) based on
                features of the emergency facility that may have a bearing on its
                contracted rate with plans and issuers, but which are unrelated or
                incidental to the facility's role as a provider of emergency services.
                Geographic Regions
                 Under the No Surprises Act, plans and issuers must calculate the
                median contracted rate for an item or service using contracted rates
                for the same or similar item or service provided in the geographic
                region in which the item or service is furnished. The No Surprises Act
                directs the Departments, in consultation with the National Association
                of Insurance Commissioners (NAIC), to establish through rulemaking the
                geographic regions to be applied when determining the QPA, taking into
                account access to items and services in rural and underserved areas,
                including health professional shortage areas, as defined in section 332
                of the PHS Act.\55\
                ---------------------------------------------------------------------------
                 \55\ Under section 332 of the PHS Act, a health professional
                shortage area is (A) an area in an urban or rural area (which need
                not conform to the geographic boundaries of a political subdivision
                and which is a rational area for the delivery of health services)
                which the Secretary of HHS determines has a health manpower shortage
                and which is not reasonably accessible to an adequately served area,
                (B) a population group which the Secretary determines has such a
                shortage, or (C) a public or nonprofit private medical facility or
                other public facility which the Secretary determines has such a
                shortage. All Federally qualified health centers and rural health
                clinics, as defined in section 1861(aa) of the Social Security Act
                (42 U.S.C. 1395x(aa)), that meet the requirements of section 254g of
                title 42 shall be automatically designated as having such a
                shortage.
                ---------------------------------------------------------------------------
                 In consulting on the geographic regions to be applied under the No
                Surprises Act, the NAIC recommended that geographic regions correspond
                to the applicable rating area used for purposes of the individual
                market and small group market rating rules under section 2701 of the
                PHS Act, implemented at 45 CFR 147.102, while allowing states the
                flexibility to establish alternative geographic regions. However, some
                states define rating area by county, resulting in large numbers of
                rating areas in a state, some of which might include very few, if any,
                facilities and providers. Therefore, adopting the rating area
                definitions as the standard for geographic regions could lead to a
                large number of geographic regions for which a plan or issuer would
                have to calculate separate median contracted rates, a large number of
                geographic regions without sufficient information, as well as a large
                number of geographic regions in which the median contracted rate is
                influenced by outliers.
                 After consultation with the NAIC, the Departments are establishing
                geographic regions under these interim final rules that reflect
                differences in health care costs based on whether care is provided in
                urban or rural areas. The Departments are of the view that these
                geographic regions take into account access to items and services in
                rural and underserved areas, including health professional shortage
                areas, as defined at section 332 of the PHS Act. The Departments intend
                to monitor the effect of these geographic regions and periodically
                update such regions, as appropriate, taking into account the findings
                of the report submitted under section 109(a) of the No Surprises Act,
                which addresses, among other things, access to health care items and
                services in rural areas and health professional shortage areas.
                 In defining ``geographic regions,'' the Departments have sought not
                only to minimize instances in which a plan or issuer lacks sufficient
                information to calculate the median of contracted rates in any
                particular geographic region, but also to limit the instances in which
                a plan or issuer has only the minimum amount of information to meet the
                sufficient information standard, as discussed later in this preamble.
                Using larger geographic regions, for which plans and issuers are likely
                to have more information, is expected to reduce the likelihood that the
                median of contracted rates would be skewed by contracts under which the
                parties have agreed to particularly high or low payment amounts.
                 Under these interim final rules, for items and services other than
                air ambulance services, a geographic region is generally defined as one
                region for each metropolitan statistical area (MSA) in a state and one
                region consisting of all other portions of the state. The delineations
                for MSAs are described by the U.S. Office of Management and Budget
                (OMB) and published by the U.S. Census Bureau.\56\ MSAs encompass at
                least one urbanized area with a population of 50,000 or more people,
                plus adjacent territory that has a high degree of social and economic
                integration with the core as measured by commuting ties. MSAs are
                always established along county boundaries, but may include counties
                from more than one state. Under this definition, MSAs that cross state
                boundaries are divided between the respective states, with all the
                counties in a particular MSA in each state counted as a geographic
                region.
                ---------------------------------------------------------------------------
                 \56\ OMB Bulletin No. 20-01. ``Revised Delineations of
                Metropolitan Statistical Areas, Micropolitan Statistical Areas, and
                Combined Statistical Areas, and Guidance on Uses of the Delineations
                of These Areas'' (Mar. 6, 2020), available at https://www.whitehouse.gov/wp-content/uploads/2020/03/Bulletin-20-01.pdf.
                U.S. Census Bureau, Delineation Files, available at https://www.census.gov/geographies/reference-files/time-series/demo/metro-micro/delineation-files.html.
                ---------------------------------------------------------------------------
                 However, under this definition, if a plan or issuer does not have
                sufficient information to calculate the median of contracted rates for
                an item or service provided in an MSA, the plan or issuer must consider
                all MSAs in the state to be a single region when calculating the median
                of contracted rates for the item
                [[Page 36893]]
                or service provided in that MSA. In such cases, all MSAs in the state
                will constitute one geographic region, and all other portions of the
                state will continue to constitute a different region. If after applying
                these broader regions, a plan or issuer continues to have insufficient
                information to calculate the median of contracted rates, geographic
                regions will be based on Census divisions, with one region consisting
                of all MSAs in the Census division, and one region consisting of all
                other portions of the Census division. There are nine Census divisions,
                as published by the U.S. Census Bureau.\57\ This approach will help to
                reduce instances in which a plan or issuer cannot rely on its own
                contracted rates to determine the QPA in cases where the plan or issuer
                is not limited to operating within a single state but instead has
                provider contracts in a multi-state region.
                ---------------------------------------------------------------------------
                 \57\ U.S. Department of Commerce Economics and Statistics
                Administration, U.S. Census Bureau, available at https://www2.census.gov/geo/pdfs/maps-data/maps/reference/us_regdiv.pdf.
                ---------------------------------------------------------------------------
                 These interim final rules establish alternate geographic regions
                with respect to air ambulance services. Given the nature of air
                ambulance services, the infrequency with which they are provided
                relative to the other types of items and services subject to the No
                Surprises Act, and the lower prevalence of participating providers of
                air ambulance services, the Departments have determined not to apply a
                definition of geographic regions based on MSAs, as narrow regions would
                result in more instances of insufficient information.
                 Thus, for air ambulance services, a geographic region means one
                region consisting of all MSAs in the state, and one region consisting
                of all other portions of the state. If a plan or issuer does not have
                sufficient information to calculate the median of the contracted rates
                for an air ambulance service using that definition of a geographic
                region, these interim final rules apply broader regions based on Census
                divisions--that is, one region consisting of all MSAs in each Census
                division and one region consisting of all other portions of the Census
                division. Because air ambulance services can be furnished over large
                distances, these interim final rules provide that the geographic region
                to be applied for air ambulance services is determined based on the
                point of pick-up, meaning the location of the individual at the time
                the individual is placed on board the air ambulance. This approach is
                generally consistent with prevailing market practices among both
                private and public payers.
                Non-Fee-for-Service Contractual Arrangements
                 The No Surprises Act provides that rulemaking to establish the
                methodology used to determine the QPA must take into account payments
                that are made by a plan or issuer that are not on a fee-for-service
                basis. The Departments are aware that many types of alternative
                reimbursement models exist that are not standard fee-for-service
                arrangements. For example, under a bundled payment arrangement, plans
                and issuers may reimburse a provider for multiple items and services
                under a single billing code. Other payers have capitation arrangements,
                under which a provider or panel of providers is paid a fixed amount per
                member per month.
                 The Departments understand that when a plan or issuer has a fully-
                or partially-capitated payment arrangement, the plan or issuer also
                typically has an internal methodology used to value claims for those
                payments made on a capitated basis. For example, a plan or issuer with
                capitation arrangements may have an underlying fee schedule that is
                used to calculate an individual's cost sharing. The Departments are of
                the view that, when a plan or issuer has an underlying fee schedule
                used to determine cost sharing under non-fee-for-service contracts, it
                is reasonable for the plan or issuer to use the same methodology to
                assign a value to the item or service for purposes of determining the
                QPA. This approach is used by plans and issuers in other similar
                contexts, including when providing data for the risk adjustment program
                \58\ and when making publicly available in-network rates under the
                transparency in coverage regulations.\59\
                ---------------------------------------------------------------------------
                 \58\ See 45 CFR 153.710(c) (requiring an issuer of a risk
                adjustment covered plan or a reinsurance-eligible plan in a state in
                which HHS is operating the risk adjustment or reinsurance program,
                as applicable, that does not generate individual enrollee claims in
                the normal course of business to derive the costs of all applicable
                provider encounters using its principal internal methodology for
                purposes of pricing those encounters).
                 \59\ See 26 CFR 54.9815-2715A3(b)(1)(C); 29 CFR 2590.715-
                2715A3(b)(1)(C); 45 CFR 147.212(b)(1)(C) (requiring plans and
                issuers that use underlying fee schedule rates for calculating cost
                sharing to make publicly available on an internet website the
                underlying fee schedule rates for all covered items and services).
                ---------------------------------------------------------------------------
                 Therefore, in the case of these alternative payment models, such as
                bundled and fully or partially capitated arrangements, where payment
                made by a plan or issuer is not fully on a fee-for-service basis, these
                interim final rules provide that the plan or issuer must calculate a
                median contracted rate for each item or service using the underlying
                fee schedule rates for the relevant items and services, if underlying
                fee schedule rates are available. The term ``underlying fee schedule
                rate'' means the rate for a covered item or service from a particular
                participating provider, providers, or facility that a group health plan
                or health insurance issuer uses to determine a participant's,
                beneficiary's, or enrollee's cost-sharing liability for the item or
                service, when that rate is different from the contracted rate.\60\ If
                there is no underlying fee schedule rate for an item or service, these
                interim final rules provide that the plan or issuer must calculate the
                median contracted rate using a derived amount, which, consistent with
                the definition in the transparency in coverage regulations, is the
                price that a plan or issuer assigns an item or service for the purpose
                of internal accounting, reconciliation with providers, or for the
                purpose of submitting data in accordance with the requirements of 45
                CFR 153.710(c).
                ---------------------------------------------------------------------------
                 \60\ This definition is substantially similar to the definition
                of ``underlying fee schedule rate'' in the transparency in coverage
                regulations at 26 CFR 54.9815-2715A1(a)(2)(xxii), 29 CFR 2590.715-
                2715A1(a)(2)(xxii), and 45 CFR 147.210(a)(2)(xxii).
                ---------------------------------------------------------------------------
                 The Departments considered alternative approaches to account for
                non-fee-for-service contractual arrangements, such as requiring plans
                and issuers to calculate median contracted rates for service bundles,
                or allowing plans or issuers to disregard certain types of non-fee-for-
                service contracts for purposes of calculating the median contracted
                rate. However, the approach specified in these interim final rules will
                ensure that the median contracted rate calculation accounts for a range
                of different contractual arrangements, including instances where a plan
                or issuer uses different types of contracting models with different
                providers and facilities. Using an underlying fee schedule or derived
                amount will allow plans or issuers to, in essence, convert each of
                their non-fee-for-service contracts into fee-for-service arrangements
                for purposes of calculating the median contracted rate. By avoiding
                instances where plans or issuers might have been required to disregard
                some of their contracts, this approach minimizes the number of
                instances in which a plan or issuer would not have sufficient
                information to calculate a median contracted rate and ensures that
                arrangements that pay for value over service volume are reflected in
                the QPA. In addition, this approach will result in the calculation of a
                QPA that aligns with a service code (or service-code modifier
                [[Page 36894]]
                combination). The Departments anticipate this result will be helpful to
                nonparticipating providers and facilities in understanding how much
                cost sharing they are permitted to charge for a given item or service,
                and as they negotiate with the plan or issuer to determine the out-of-
                network rate.
                 It is the Departments' understanding that under certain capitated
                and bundled payment arrangements, providers' payments may be reconciled
                retrospectively to account for utilization, value adjustments, or other
                weighting factors that can affect the final payment to a provider. In
                addition, payers and providers may agree to certain incentive payments
                during the contracting process to promote the provision of higher-
                quality, lower-cost health care to participants, beneficiaries, or
                enrollees over time. These interim final rules specify that when
                calculating median contracted rates, plans and issuers must exclude
                risk sharing, bonus, or penalty, and other incentive-based and
                retrospective payments or payment adjustments. The Departments are of
                the view that excluding these payments and payment adjustments from the
                median contracted rates used to determine cost sharing for items and
                services furnished by nonparticipating providers or facilities is
                consistent with how cost sharing is typically calculated for in-network
                items and services, where the cost-sharing amount is customarily
                determined at or near the time an item or service is furnished, and is
                not subject to adjustment based on changes in the amount ultimately
                paid to the provider or facility as a result of any incentives or
                reconciliation process.
                b. Indexing
                 The No Surprises Act provides that, in instances when the median
                contracted rate is determined as of January 31, 2019, the QPA for items
                and services furnished during 2022 is calculated by increasing the
                median contracted rate by the percentage increase in the consumer price
                index for all urban consumers (U.S. city average) (CPI-U) over 2019,
                the percentage increase over 2020, and the percentage increase over
                2021. The No Surprises Act further provides that the QPA for 2022 is
                then adjusted annually for items and services furnished during 2023 or
                a subsequent year. Therefore, the increase for any year is the CPI-U
                for the year, as so defined, divided by the CPI-U for the prior year.
                The combined percentage increase for 2019, 2020, and 2021 to determine
                the amount for 2022 is the product of the CPI-U increases for 2019,
                2020, and 2021 multiplied together. For any year, the factor will be
                the quotient of CPI-U for the current year divided by the CPI-U for the
                prior year. For example, for an item or service provided in 2023, the
                2023 QPA is the 2022 QPA multiplied by the CPI-U 2022/CPI-U 2021.
                 These interim final rules provide specifications for calculating
                the percentage increase in CPI-U to ensure that all plans and issuers
                adjust the percentage in a uniform manner. In order to ensure that
                uniformity, these interim final rules provide that plans and issuers
                will calculate the increases using the factors determined by the
                Treasury Department and the IRS, and published in guidance by the IRS.
                In determining the factors, these interim final rules provide that the
                percentage increase for any year is calculated by using the CPI-U
                published by the Bureau of Labor Statistics of the DOL. For this
                purpose, the CPI-U for each calendar year is the average of the CPI-U
                as of the close of the 12-month period ending on August 31 of the
                calendar year, rounded to 10 decimal places. This allows the
                Departments to provide the percentage increase factor before January 1
                of each applicable year with sufficient time to adjust the QPAs for the
                year.
                c. Special Rules for Unit-Based Services
                 These interim final rules provide special rules for calculating the
                QPA for items or services for which a plan or issuer generally
                determines the reimbursement level for the same or similar items or
                services by multiplying the contracted rate by another unit, such as
                time or mileage. In these cases, indexing the median contracted rate to
                calculate the QPA would result in an amount that does not reflect the
                other units that are generally considered when calculating the in-
                network payment amount. Therefore, when reimbursement levels are
                determined using this approach, these interim final rules specify that
                the QPA is calculated by determining the median contracted rate used
                for that item or service, indexing that median amount in accordance
                with the otherwise applicable rules regarding indexing, and then
                applying the pertinent multipliers. These interim final rules also
                include specific instructions for calculating the QPA for anesthesia
                services and for certain service codes for air ambulance services.
                Anesthesia Services
                 Payers generally calculate payment amounts for anesthesia services
                by multiplying the negotiated rate for the anesthesia conversion factor
                that has been negotiated between the payer and the provider (expressed
                in dollars per unit) by (1) the base unit for the anesthesia service
                code, (2) the time unit, and (3) the physical status modifier unit. The
                base unit, time unit, and physical status modifier unit are specific to
                the individual receiving the anesthesia services. These units are not
                expressed in dollars per unit, nor do they vary by contract. The base
                units for an anesthesia service code are the American Society of
                Anesthesiologists Relative Value Guide base units for that service
                code. The time unit represents the length of time during which the
                anesthesia services were furnished, and for purposes of the QPA
                methodology, is measured in 15-minute increments or a fraction thereof.
                The physical status modifier on a claim is a standard modifier
                describing the physical status of the patient and is used to
                distinguish between the various levels of complexity of the anesthesia
                services provided, and is expressed as a unit with a value between zero
                (0) and three (3).
                 These interim final rules include a methodology for calculating the
                QPA for these anesthesiology services that reflects the manner in which
                providers are generally paid for these services. To calculate the QPA
                for anesthesia services furnished during 2022, these interim final
                rules require the plan or issuer to, first, take the median contracted
                rate for the anesthesia conversion factor (determined in accordance
                with the methodology for calculating median contracted rates for
                service code-modifier combinations) for the same or similar item or
                service as of January 31, 2019, and increase that amount to account for
                changes in the CPI-U, using the methodology described earlier in this
                section of the preamble. This amount is referred to as the indexed
                median contract rate. The plan or issuer must then multiply this
                indexed median contracted rate for the anesthesia conversion factor by
                the sum of the base unit (using the value specified in the most
                recently published edition (as of the date of service) of the American
                Society of Anesthesiologists Relative Value Guide), time unit, and
                physical status modifier units of the participant, beneficiary, or
                enrollee to whom anesthesia services are furnished to determine the
                QPA.
                 To calculate the QPA for anesthesia services furnished during 2023
                or a subsequent year, the plan or issuer must use the indexed median
                contracted rate for the anesthesia conversion factor, and adjust that
                amount by the percentage increase in the CPI-U over the previous year
                using the methodology described earlier in this section of the
                preamble.
                [[Page 36895]]
                The plan or issuer must then multiply that amount by the sum of the
                base unit (using the value specified in the most recently published
                edition (as of the date of service) of the American Society of
                Anesthesiologists Relative Value Guide), time unit, and physical status
                modifier units for the participant, beneficiary, or enrollee to whom
                anesthesia services are furnished to determine the QPA.
                Air Ambulance Services
                 Payers often reimburse for air ambulance services in part by using
                air mileage service codes (A0435 and A0436) and reimbursement levels
                that reflect the number of miles an individual is transported by the
                air ambulance, which are referred to as loaded miles. Payment amounts
                are calculated by multiplying the negotiated rate for the service code,
                referred to in this rule as the air mileage rate, by the number of
                loaded miles. These interim final rules include a methodology for
                calculating the QPA for these air mileage service codes that reflects
                the manner in which providers are generally paid for the service codes.
                 To calculate the QPA for the portion of air ambulance services
                billed using the air mileage service codes that are furnished during
                2022, the plan or issuer must first increase the median contracted
                rate, in accordance with 26 CFR 54.9816-6T(c)(1)(i), 29 CFR 2590.716-
                6(c)(1)(i), or 45 CFR 149.140(c)(1)(i), as applicable. This amount is
                referred to as the indexed median air mileage rate. The plan or issuer
                must then multiply the indexed median air mileage rate by the number of
                loaded miles provided to the participant, beneficiary, or enrollee to
                determine the QPA.
                 To calculate the QPA for air ambulance services billed using the
                air mileage service codes (A0435 and A0436) that are furnished during
                2023 or a subsequent year, the plan or issuer must increase the indexed
                median air mileage rate, determined for such services furnished in the
                immediately preceding year, using the methodology described in 26 CFR
                54.9816-6T(c)(1)(ii), 29 CFR 2590.716-6(c)(1)(ii), or 45 CFR
                149.140(c)(1)(ii), as applicable. The plan or issuer must then multiply
                the indexed median air mileage rate by the number of loaded miles
                provided to the participant, beneficiary, or enrollee to determine the
                QPA.
                d. Cases With Insufficient Information
                 Section 9816(a)(3)(E)(iii) of the Code, section 716(a)(3)(E)(iii)
                of ERISA, and section 2799A-1(a)(3)(E)(iii) of the PHS Act, as added by
                the No Surprises Act, specify an alternative process to determine the
                QPA in cases where a group health plan or health insurance issuer
                offering group or individual health insurance coverage lacks sufficient
                information to calculate the median of contracted rates in 2019, as
                well as for newly covered items or services in the first coverage year
                after 2019.
                Definition of Sufficient Information
                 Under these interim final rules, a plan or issuer is considered to
                have sufficient information to calculate the median of contracted rates
                if the plan or issuer has at least three contracted rates on January
                31, 2019, to calculate the median of the contracted rates in accordance
                with the methodology in these interim final rules. In the Departments'
                view, while a median contracted rate could be calculated with a smaller
                number of contracts, requiring a minimum of three contracted rates is
                supported by the statute's direction to calculate a median, rather than
                a mean. Furthermore, the Departments have determined that three
                contracted rates for a particular item or service in a geographic
                region represents the minimum number of contracts necessary to
                reasonably reflect typical market negotiations while reducing the
                potential for outlier rates to unduly influence the calculation of the
                QPA.
                 Under section 9816(a)(3)(E)(iii) of the Code, section
                716(a)(3)(E)(iii) of ERISA, section 2799A-1(a)(3)(E)(iii) of the PHS
                Act, and these interim final rules, where a plan or issuer that
                initially does not have sufficient information to calculate the median
                contracted rate based on January 31, 2019 contracted rates (or for new
                plans and coverage or new service codes, as discussed in more detail in
                this section of the preamble) later gains sufficient information, the
                plan or issuer must calculate the QPA using the median contracted rate
                for the first sufficient information year. The first sufficient
                information year is defined as: (1) In the case of an item or service
                for which a plan or issuer does not have sufficient information to
                calculate the median of contracted rates in 2019, the first year after
                2022 for which the plan or issuer has sufficient information to
                calculate the median of contracted rates in the year immediately
                preceding that first year after 2022; and (2) in the case of a newly
                covered item or service, the first year after the first coverage year
                for such item or service with respect to such plan or coverage for
                which the plan or issuer has sufficient information to calculate the
                median of the contracted rates in the year immediately preceding that
                first year.
                 In cases in which contracted rates for a year after 2019 must be
                used to calculate the median contracted rate, a plan or issuer will be
                considered to have sufficient information to calculate the median
                contracted rate for a year if, with respect to that year, both of the
                following conditions are met: (1) The plan or issuer has at least three
                contracted rates on January 31 of the year immediately preceding that
                year to calculate the median of the contracted rates in accordance with
                the methodology in these interim final rules; and (2) the contracted
                rates account (or are reasonably expected to account) for at least 25
                percent of the total number of claims paid for that item or service for
                that year with respect to all plans of the sponsor (or of the
                administering entity, if applicable) or all coverage offered by the
                issuer that are offered in the same insurance market.
                 The requirement that a plan or issuer have at least three
                contracted rates for a particular item or service in a geographic
                region is the same as the requirement that applies when determining
                whether there is sufficient information to calculate a median
                contracted rate for items and services furnished during 2022 using the
                median of contracted rates as of January 31, 2019. The 25 percent
                minimum claims volume requirement, however, applies where only
                contracted rates for years after 2019 are used to determine whether a
                plan or issuer has sufficient information to calculate the median
                contracted rate in the first sufficient information year. While the
                Departments are not concerned about manipulation of the QPA in the
                majority of cases where the median contracted rate is based on 2019
                contracted rates, the Departments recognize the potential for plans and
                issuers to engage in selective contracting practices that artificially
                change the median contracted rate in cases where subsequent year
                contracted rates are used to determine the QPA. Therefore, this
                requirement will help to ensure that when contracted rates for years
                after 2019 are used to calculate a median contracted rate, those
                network contracts represent a reasonable proportion of a plan's or
                issuer's total claims and are not designed to manipulate the QPA.
                Eligible Databases
                 In cases in which a plan or issuer does not have ``sufficient
                information'' to calculate a median contracted rate, the No Surprises
                Act directs the plan or issuer to determine the QPA through use of any
                database that is determined, in accordance with rulemaking issued by
                the Departments, to not have any
                [[Page 36896]]
                conflicts of interest and to have sufficient information reflecting
                allowed amounts paid to a health care provider or facility for relevant
                services furnished in the applicable geographic region (such as a state
                all-payer claims database).
                 These interim final rules establish standards for databases,
                referred to as eligible databases, that may be used to determine the
                QPA. State all-payer claims databases are categorically eligible under
                these interim final rules because they are specifically identified as
                not having any conflicts of interest and as having sufficient
                information reflecting allowed amounts in section 9816(a)(3)(E)(iii)(I)
                of the Code, section 716(a)(3)(E)(iii)(I) of ERISA, and section 2799-
                1(a)(3)(E)(iii)(I) of the PHS Act. Other third-party databases may also
                be eligible, provided all of the following conditions are satisfied.
                 First, the database or the organization maintaining the database
                cannot be affiliated with, or owned or controlled by, any health
                insurance issuer, or a health care provider, facility, or provider of
                air ambulance services, or any member of the same controlled group as,
                or under common control with, any such entity. For example, if a
                majority of the members on the governing board of a database or the
                organization maintaining the database are associated with a health
                insurance issuer, the database would be considered to have a conflict
                of interest under these interim final rules, since it is controlled by
                the issuer. As another example, if an issuer owns 40 percent of the
                stock of the organization that maintains a database, and its subsidiary
                owns an additional 20 percent of the stock of the organization that
                maintains the database, the database would be considered to have a
                conflict of interest under these interim final rules, since it is
                effectively controlled by the issuer. As a third example, if an issuer
                and the organization that maintains a database are both subsidiaries of
                the same parent organization, the database would be considered to have
                a conflict of interest under these interim final rules, since it is
                affiliated with the issuer. In the Departments' view, this standard is
                critical to ensuring the independence of any database used to determine
                the QPA. The Departments solicit comment on whether a database should
                not be affiliated with, or owned or controlled by, other entities, such
                as plan sponsors or third-party administrators, in order to avoid a
                conflict of interest. The Departments also seek comment on whether to
                establish a specific threshold that a party's minority ownership
                interest must meet or exceed in order to create a conflict of interest
                for purposes of these interim final rules.
                 For purposes of applying the controlled group rules to eligible
                databases, a controlled group means a group of two or more persons that
                is treated as a single employer under Code sections 52(a), 52(b),
                414(m), or 414(o). The Treasury Department and the IRS are considering
                whether further guidance is needed under section 52(a) or (b) of the
                Code to address either organizations exempt from tax under section
                501(a) of the Code or nonprofit organizations that, although not exempt
                from tax under section 501(a) of the Code, do not have members or
                shareholders that are entitled to receive distributions of the
                organization's income or assets (including upon dissolution) or that
                otherwise retain equity interests similar to those generally held by
                owners of for-profit entities. Until further guidance is issued, those
                two types of organizations may either rely on a reasonable, good-faith
                application of section 52(a) and (b) of the Code (taking into account
                the reasons for which the controlled group rules are incorporated into
                the definition of eligible database) or apply the rules set forth in 26
                CFR 1.414(c)-5(a) through (d) (but substituting ``more than 50
                percent'' in place of ``at least 80 percent'' each place it appears in
                26 CFR 1.414(c)-5).
                 Second, the database must have sufficient information reflecting
                in-network amounts paid by group health plans or health insurance
                issuers offering group or individual health insurance coverage to
                providers, facilities, or providers of air ambulance services for
                relevant items and services furnished in the applicable geographic
                region. The Departments recognize that for a database to be used to
                calculate the QPA, the database should contain sufficient data to
                reflect the true market dynamics in a given geographic region. However,
                in order to provide flexibility in the initial implementation of the No
                Surprises Act, these interim final rules do not establish a specific
                definition of when a database is considered to have sufficient
                information. The Departments seek comment on how to define when a
                database has sufficient information, including whether to establish
                specific criteria that a claims database would need to satisfy in order
                to demonstrate that it has sufficient information reflecting in-network
                payment amounts for providers or facilities in the applicable
                geographic region, such as a requirement that the database represents a
                specified minimum percentage of the claims volume for the region.
                 Third, the database must have the ability to distinguish amounts
                paid to participating providers and facilities by commercial payers,
                such as group health plans and health insurance issuers offering group
                or individual health insurance coverage, from all other claims data,
                such as amounts billed by nonparticipating providers or facilities and
                amounts paid by public payers, including the Medicare program under
                title XVIII of the Social Security Act, the Medicaid program under
                title XIX of the Social Security Act (or a demonstration project under
                title XI of the Social Security Act),\61\ and the Children's Health
                Insurance Program under title XXI of the Social Security Act.
                ---------------------------------------------------------------------------
                 \61\ Under section 1115 of the Social Security Act, the
                Secretary of HHS has the authority to approve experimental, pilot,
                or demonstration projects that, in his judgment, are likely to
                assist in promoting the objectives of the Medicaid statute. Under
                section 1115 authority, the Secretary may waive compliance with
                certain provisions of Medicaid and CHIP law and may authorize
                federal matching funds for state expenditures that would not
                otherwise be federally matchable under the Medicaid and CHIP
                statutes. Many states have section 1115 demonstrations under which
                they cover services that would not otherwise be covered under the
                Medicaid or CHIP programs.
                ---------------------------------------------------------------------------
                 To calculate the QPA for an item or service furnished during 2022
                (or in the case of newly covered items or services, in the first
                coverage year) using an eligible database, the plan or issuer must
                first identify the rate in the database that is equal to the median of
                the in-network allowed amounts for the same or similar item or service
                in the geographic region in the year immediately preceding the year in
                which the item or service is furnished (or in the case of a newly
                covered item or service, the year immediately preceding the first
                coverage year). It is the Departments' view that in-network allowed
                amounts for items and services are a reasonable proxy for contracted
                rates, and that where there is insufficient information to calculate
                the QPA based on the median of a plan's or issuer's own contracted
                rates, using the median of in-network allowed amounts for all private
                payers in an eligible database is a reasonable method for approximating
                the median contracted rate for items and services in the applicable
                geographic region. The Departments are also of the view that
                determining the QPA for an item or service using the median of in-
                network allowed amounts for the same or similar item or service in the
                geographic region in the year immediately preceding the year in which
                the item or service is furnished is reasonably likely to result in
                levels of cost sharing that are
                [[Page 36897]]
                generally in line with the cost-sharing liability incurred by
                participants, beneficiaries, and enrollees in plans with similar levels
                of in-network cost-sharing for the same or similar items or services.
                 Once the median in-network allowed amount has been identified, that
                rate is then increased by the percentage increase in the CPI-U over the
                previous year using the methodology described earlier in this section
                of the preamble. For each subsequent year before the first sufficient
                information year, the plan or issuer must increase the QPA applicable
                to items or services furnished in the immediately preceding year by the
                percentage increase in CPI-U over the preceding year. Plans and issuers
                must continue to use this methodology until the first sufficient
                information year, at which point the plan or issuer must calculate the
                median contracted rate and determine the QPA using the standard
                methodology discussed earlier in this section of the preamble.
                 These interim final rules require that plans and issuers use a
                consistent methodology when relying on an eligible database.
                Specifically, for any particular item or service, a plan or issuer
                using a database must use the same database to determine the QPA for
                that item or service through the last day of the calendar year, and if
                a different database is selected for some items or services, the basis
                for that selection must be one or more factors not directly related to
                the rate of those items or services (such as sufficiency of data for
                those items or services).\62\ This consistency requirement is designed
                to ensure that when relying on an eligible database to determine the
                QPA for an item or service, a plan or issuer cannot vary the database
                selected due to the rates associated with that item or service. The
                Departments seek comment on this consistency requirement and whether
                additional standards or guidance are needed to ensure compliance and
                prevent abuse.
                ---------------------------------------------------------------------------
                 \62\ For example, these interim final rules permit a plan or
                issuer to rely on different state all-payer claims databases, based
                on the geographic region in which an item or service is furnished,
                as state all-payer claims databases may not have sufficient data for
                items and service furnished outside of the state.
                ---------------------------------------------------------------------------
                 Finally, these interim final rules codify section 9816(d) of Code,
                section 716(d) of ERISA, and section 2799A-1(d) of PHS Act, as added by
                the No Surprises Act, which provide that a plan or issuer that uses an
                eligible database to determine the QPA by reason of having insufficient
                information is responsible for any costs associated with accessing such
                database. The Departments solicit comment on ways to help ensure that
                plans and issuers are charged only reasonable costs for accessing such
                databases and that entities that provide eligible databases are
                transparent about their fees and fee structures associated with this
                process.
                New Plans and Coverage
                 The No Surprises Act directs the Departments to establish a
                methodology for the sponsor of a group health plan or a health
                insurance issuer that did not offer any plan or coverage in a
                geographic region in 2019 to determine QPAs for the first year in which
                the plan or coverage will be offered in the geographic region. For each
                subsequent year, that amount is increased by the percentage increase in
                the consumer price index for all urban consumers over the previous
                year.
                 The Departments recognize that while a sponsor or issuer may be
                newly offering coverage in a geographic region, the sponsor or issuer
                may have sufficient existing provider contracts under other current
                coverage in the geographic region where an item or service is furnished
                to calculate the QPA. The Departments clarify that it is not necessary
                to establish special procedures to calculate the QPA in these
                situations. Therefore, under these interim final rules, if the plan or
                issuer newly offering coverage in a geographic region for a year after
                2019 otherwise has sufficient information to calculate a median
                contracted rate in 2019 in the geographic region where the item or
                service is furnished, the QPA is determined using the standard
                methodology for calculating median contracted rates discussed earlier
                in this section of the preamble.
                 The Departments recognize that the standard methodology would not
                be available, however, in cases where the plan or issuer does not have
                sufficient information to calculate a median contracted rate in the
                geographic region in which the item or service is furnished, such as in
                situations where the sponsor or issuer did not offer any plan or
                coverage in 2019. In this case, the plan or issuer must determine the
                QPA in accordance with the rules applicable to plans or issuers with
                insufficient information, or for newly covered items and services,
                including the use of an eligible database, as discussed earlier in this
                section of the preamble.
                 For each subsequent year the plan or coverage is offered in the
                geographic region, the plan or issuer must increase the QPA for items
                or services furnished in the immediately preceding year by the
                percentage increase in the CPI-U over the previous year to determine
                the QPA for items and services furnished in that year. Under this
                approach, new plans and coverage that initially do not have sufficient
                information to calculate a median contracted rate must use a QPA based
                on information for the first year of coverage from an eligible database
                indefinitely, updated only by the inflation adjustment. The Departments
                seek comment on whether the methodology should instead allow new plans
                and coverage to transition to calculating a QPA using median contracted
                rates in an applicable first sufficient information year.
                New Service Codes
                 When service codes are created, plans and issuers may be unable to
                calculate the QPA using the approaches discussed earlier, because
                neither the plan or issuer nor any eligible databases have sufficient
                information regarding the new service code. This situation may occur
                for new service codes when the service codes describe items or services
                that have not previously been widely furnished. This situation may also
                occur when service codes are substantially revised, resulting in new
                service codes or new descriptors for existing service codes that
                substantially alter the types of services that would be billed using
                the original service codes. In this case, the plan, issuer, or eligible
                database may have sufficient information regarding rates for items and
                services billed under the service code prior to the revision, but that
                information may no longer reflect the rates associated with the items
                and services billed under the revised service code. The No Surprises
                Act does not specify a methodology for calculating the QPA in these
                circumstances. However, in the Departments' view, it is necessary that
                these interim final rules establish a methodology that plans and
                issuers can rely on for calculating QPAs for new service codes during
                periods of time when no eligible databases would reasonably be expected
                to have sufficient data to calculate a QPA.
                 These interim final rules define ``new service code'' to mean a
                service code that was created or substantially revised in a year after
                2019. In situations in which a plan or issuer is billed for a covered
                item or service using a new service code, the plan or issuer must first
                identify a reasonably related service code that existed in the
                immediately preceding year. For example, a reasonably related service
                code might be another service code within the same family of codes, or
                might involve services that represent similar relative value units.
                This related service code will be used as a benchmark for
                [[Page 36898]]
                determining the QPA for the new service code. The Departments seek
                comment on whether additional rules are needed regarding how plans and
                issuers should be required to identify a reasonably related service
                code, and on whether the Departments should develop a crosswalk
                methodology to identify related service codes for each new service
                code.
                 The Departments are of the view that, although Medicare payment
                rates may differ substantially from rates paid by plans and issuers, it
                is reasonable to use Medicare payment rates to approximate the relative
                cost of two different but reasonably related service codes. Therefore,
                if CMS has established a payment rate under the Medicare program for an
                item or service billed under the new service code, the plan or issuer
                must calculate the ratio of the rate that Medicare pays for the item or
                service billed under the new service code compared to the rate that
                Medicare pays for the item or service under the related service code
                (with both rates disregarding any adjustments for value-based
                purchasing arrangements that could lead to bonuses or deductions), and
                multiply that ratio by the QPA for the related service code for the
                year in which the item or service is furnished.
                 The Departments recognize that in some cases the Medicare program
                might not immediately establish a payment rate for items and services
                billed under a new service code. Therefore, these interim final rules
                establish a secondary approach to determine the QPA in these
                situations. Specifically, for items and services billed using a new
                service code for which Medicare has not established a payment rate, the
                plan or issuer must calculate the QPA by first calculating the ratio of
                the rate that the plan or issuer reimburses for an item or service
                billed under the new service code compared to the rate that the plan or
                issuer reimburses for an item or service under the related service code
                (the relativity ratio), and then multiplying the relativity ratio by
                the QPA for the item or service billed under the related service code.
                These interim final rules do not specify a particular method that plans
                and issuers must use to calculate this relativity ratio. However, the
                Departments expect plans and issuers to use a reasonable method for
                making the calculation, and seek comment on whether future rulemaking
                should specify additional requirements for determining the relativity
                ratio. For example, plans and issuers could be required to calculate
                the ratio using the medians or means of the contracted rates for each
                of the two services. However, the Departments recognize that it may
                take time for plans and issuers to enter into negotiated rates for new
                service codes, and therefore the medians or means may change over time.
                Alternatively, plans and issuers could be required to calculate the
                relativity ratio using rates from one contract, based on the assumption
                that negotiated rates within any given contract would generally produce
                a similar relativity ratio. The Departments are of the view that using
                rates from two different contracts would not constitute a reasonable
                method for calculating the relativity ratio, as this approach could
                introduce into the relativity ratio, variation from factors that are
                unrelated to the relative cost of furnishing the item or service, such
                as the negotiating power of the parties to the contract.
                 Under the methodology in these interim final rules, for items or
                services furnished in any subsequent year (before the first sufficient
                information year for such item or service with respect to such plan or
                coverage or before the first year for which an eligible database has
                sufficient information in the immediately preceding year), the plan or
                issuer must calculate the QPA by increasing the QPA calculated for the
                prior year by the percentage increase in CPI-U over the immediately
                preceding year.
                 However, for an item or service billed using a new service code,
                and furnished in the first sufficient information year for such item or
                service with respect to such plan or coverage, or furnished in the
                first year for which an eligible database has sufficient information to
                enable the plan or issuer to calculate the QPA using the processes that
                generally apply when an issuer or plan has insufficient information,
                the plan or issuer must calculate the QPA in accordance with 26 CFR
                54.9816-6T(c)(3), 29 CFR 2590.716-6(c)(3), or 45 CFR 149.140(c)(3), as
                applicable. Thus, once the plan or issuer or an eligible database has
                sufficient information to calculate a QPA, the QPA for a new service
                code would be calculated using the median contracted rate of the plan
                or issuer, or the median of the in-network allowed amounts in the
                eligible database.
                 The Departments seek comment on any alternate approaches that could
                be used to determine the QPA for new service codes.
                e. Information To Be Shared About the QPA
                 The No Surprises Act directs the Departments to specify the
                information that a plan or issuer must share with a nonparticipating
                provider or nonparticipating emergency facility, as applicable, when
                making a determination of a QPA.
                 The Departments recognize that providers, emergency facilities, and
                air ambulance providers subject to the surprise billing rules need
                transparency regarding how the QPA was determined. This information is
                also important in informing the negotiation process. In addition, IDR
                entities are directed by statute to consider the QPA when selecting an
                offer submitted by the parties through the IDR process. Therefore, to
                decide whether to initiate the IDR process and what offer to submit, a
                provider, emergency facility, or provider of air ambulance services
                must know not only the value of the QPA, but also certain information
                on how it was calculated.
                 The Departments seek to ensure transparent and meaningful
                disclosure about the calculation of the QPA while minimizing
                administrative burdens on plans and issuers. These interim final rules
                therefore require that plans and issuers make certain disclosures with
                each initial payment or notice of denial of payment, and that plans and
                issuers must provide additional information upon request of the
                provider or facility. This information must be provided in writing,
                either on paper or electronically, to a nonparticipating provider,
                emergency facility, or provider of air ambulance services, as
                applicable, when the QPA serves as the recognized amount.
                 First, a plan or issuer must provide the QPA for each item or
                service involved.
                 Second, a plan or issuer must provide a statement certifying that,
                based on the determination of the plan or issuer: (1) The QPA applies
                for purposes of the recognized amount (or, in the case of air ambulance
                services, for calculating the participant's, beneficiary's, or
                enrollee's cost sharing), and (2) each QPA shared with the provider or
                facility was determined in compliance with the methodology outlined in
                these interim final rules. These interim final rules require a
                statement from the plan or issuer that the QPA applies for purposes of
                the recognized amount so that providers and facilities will understand
                that the plan or issuer has determined that neither an All-Payer Model
                Agreement nor a specified state law applies for purposes of calculating
                a participant's, beneficiary's, or enrollee's cost-sharing liability,
                but rather that cost-sharing liability has been calculated using the
                QPA. With respect to air ambulance services, the statement will ensure
                providers of air ambulance services understand that the QPA, rather
                than the billed charge, applies for
                [[Page 36899]]
                purposes of calculating the cost-sharing liability, because the plan or
                issuer has determined that the QPA is lower than the billed charge. The
                Departments expect that in most if not all cases where the QPA serves
                as the basis for determining the recognized amount, the federal IDR
                process will govern any dispute over payment instead of a specified
                state law or process. Therefore, this notice will also serve to direct
                providers or facilities to the federal IDR process if the parties
                cannot agree on an out-of-network rate.
                 Third, a plan or issuer must provide a statement that if the
                provider or facility, as applicable, wishes to initiate a 30-day open
                negotiation period for purposes of determining the amount of total
                payment, the provider or facility may contact the appropriate person or
                office to initiate open negotiation, and that if the 30-day open
                negotiation period does not result in a determination, generally, the
                provider or facility may initiate the IDR process within 4 days after
                the end of the open negotiation period. The plan or issuer must also
                provide contact information, including a telephone number and email
                address, for the appropriate office or person to initiate open
                negotiations for purposes of determining an amount of payment
                (including cost sharing) for such item or service.
                 In addition, upon request of the provider or facility, a plan or
                issuer must provide, in a timely manner, information about whether the
                QPA includes contracted rates that were not set on a fee-for-service
                basis for the specific items and services at issue and whether the QPA
                for those items and services was determined using underlying fee
                schedule rates or a derived amount. If a related service code was used
                to determine the QPA for a new service code, a plan or issuer must
                provide information to identify which related service code was used.
                Similarly, if an eligible database was used to determine the QPA, a
                plan or issuer must provide information to identify which database was
                used to determine the QPA.
                 Finally, if applicable upon request, a plan or issuer must provide
                a statement that the plan's or issuer's contracted rates include risk-
                sharing, bonus, penalty, or other incentive-based or retrospective
                payments or payment adjustments for the items and services involved
                that were excluded for purposes of calculating the QPA. Having
                information about whether the median contracted rate excludes these
                types of payment adjustments will better inform the open negotiation
                and IDR process.
                 The Departments seek comment on these disclosure requirements and
                on what additional information a plan or issuer should be required to
                share with a provider or facility about the QPA, either in all cases or
                upon request. The Departments also seek comment on whether a specific
                definition or standard is needed to ensure that information provided
                upon request is disclosed in a timely manner.
                f. Audits
                 The No Surprises Act requires rulemaking to establish a process
                under which group health plans and health insurance issuers offering
                group or individual health insurance coverage are audited by the
                applicable Secretary or applicable state authority to ensure that such
                plans and coverage are in compliance with the requirement of applying a
                QPA and that the QPA applied satisfies the definition under the No
                Surprises Act with respect to the year involved.\63\
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                 \63\ See section 9816(a)(2)(A) of the Code; section 2799A-
                1(a)(2)(A) of the PHS Act. The DOL and OPM will rely on the existing
                agency processes to ensure compliance with the No Surprises Act, as
                discussed in this section of the preamble.
                ---------------------------------------------------------------------------
                 The enforcement responsibilities of HHS and the states with respect
                to oversight of health insurance issuer compliance with the federal
                insurance market reforms are set forth in the PHS Act. Pursuant to
                section 2723(a)(1) of the PHS Act, as amended by the No Surprises Act,
                states have primary enforcement authority over health insurance issuers
                regarding the provisions of Parts A and D of title XXVII of the PHS
                Act. Under this framework, HHS has enforcement authority over issuers
                in a state if the Secretary of HHS makes a determination that the state
                is failing to substantially enforce a provision (or provisions) of Part
                A or D of title XXVII of the PHS Act.\64\
                ---------------------------------------------------------------------------
                 \64\ Section 2723(a)(2) and (b)(1)(A) of the PHS Act. See also
                45 CFR 150.203.
                ---------------------------------------------------------------------------
                 DOL and the Treasury Department generally have primary enforcement
                authority over private sector employment-based group health plans. The
                IRS has jurisdiction over certain church plans. HHS also has primary
                enforcement authority over non-federal governmental plans, such as
                those sponsored by state and local government employers.\65\ OPM has
                jurisdiction over FEHB plans, which are federal governmental plans.
                ---------------------------------------------------------------------------
                 \65\ See section 2723(b)(1)(B) of the PHS Act.
                ---------------------------------------------------------------------------
                 The Departments will generally use existing processes to ensure
                compliance with Code, ERISA, and PHS Act requirements that apply to
                group health plans and health insurance issuers, including the
                provisions added by the No Surprises Act. HHS's enforcement procedures
                related to the PHS Act federal insurance market reforms are set forth
                in section 2723 of the PHS Act and 45 CFR 150.101 et seq., including
                bases for initiating investigations and performing market conduct
                examinations. Section 504 of ERISA provides DOL with authority to
                determine whether any person has violated or is about to violate any
                provision of ERISA or any regulation or order thereunder. The interim
                final rules include an audit provision establishing that HHS's existing
                enforcement procedures will apply with respect to ensuring that a plan
                or coverage is in compliance with the requirement of determining and
                applying a QPA consistent with these interim final rules. HHS intends
                to amend its enforcement regulations through future notice and comment
                rulemaking to reflect the amendments made to the PHS Act by the No
                Surprises Act. OPM will audit FEHB plans to ensure that such plans are
                in compliance with the requirement of determining and applying a QPA.
                vii. Determination of Out-of-Network Rate in the Absence of a Specified
                State Law or an Applicable All-Payer Model Agreement
                 In instances in which a specified state law or All-Payer Model
                Agreement does not apply for purposes of specifying the out-of-network
                rate, the out-of-network rate is determined either through agreement
                between the provider or facility and plan or issuer; or through an IDR
                process, if agreement cannot be reached and such process is initiated.
                If the parties agree to an amount of payment prior to the date on which
                a certified IDR entity makes a determination with respect to such items
                or services, that agreed upon amount is the out-of-network rate.
                Otherwise, the out-of-network rate is the amount of payment determined
                by the certified IDR entity for the items or services.\66\
                ---------------------------------------------------------------------------
                 \66\ As noted previously, the Departments intend to implement
                the federal IDR process in future rulemaking.
                ---------------------------------------------------------------------------
                3. Additional Plan and Issuer Requirements Regarding Making Initial
                Payments or Providing a Notice of Denial
                 The No Surprises Act and these interim final rules establish
                several procedural requirements that apply to group health plans and
                health insurance issuers to ensure that billing disputes
                [[Page 36900]]
                related to items and services subject to the balance billing
                protections in the No Surprises Act are resolved in a timely fashion.
                These include timeframes for: A plan or issuer to send a notice of
                denial of payment or make an initial payment; the length of any open
                negotiation period regarding payment; and initiating the IDR process
                following an open negotiation period. However, those three requirements
                do not apply under certain circumstances with regard to post-
                stabilization services or to out-of-network non-emergency services
                (other than out-of-network air ambulance services) if the provider or
                facility provided notice to, and received consent from, the
                participant, beneficiary, or enrollee (or their authorized
                representative), as discussed later in this preamble.
                 Therefore, it is critical that a group health plan or health
                insurance issuer have knowledge of any notice provided and consent
                given under these interim final rules for items and services that it
                covers, and that would otherwise be subject to the surprise billing
                provisions in the statute and these interim final rules. As discussed
                later in this preamble, the interim final rules issued by HHS in this
                rulemaking require providers and facilities to notify plans and issuers
                when the notice and consent criteria have been satisfied. Absent
                receiving this information, a plan or issuer must assume that the
                individual has not waived the protections provided in these interim
                final rules, and must therefore calculate cost sharing, apply cost
                sharing to deductibles and out-of-pocket limits, and make any payments
                to providers and facilities before an individual has satisfied the
                coverage deductible, accordingly. In instances where a plan or issuer
                does receive this information, it may rely on the provider's or
                facility's representation as being true and accurate, unless and until
                the plan or issuer knows or reasonably should know otherwise. Thus, if
                a provider or facility indicates to a plan or issuer that the notice
                and consent described in these interim final rules was properly and
                timely given and received, the plan or issuer may rely on that
                information and, for example, apply out-of-network cost sharing for the
                applicable items and services, unless and until the plan or issuer
                knows or reasonably should know that the notice and consent was not
                properly and timely given and received. In cases where a plan or issuer
                believes that notice was not properly and timely given and received,
                notwithstanding a provider's or facility's assertion to the contrary,
                the plan or issuer should apply the cost-sharing and other requirements
                set forth in these interim final rules and applicable state law by,
                among other actions, reprocessing any claims that were not processed
                consistently with those requirements. The plan or issuer may also
                submit a complaint against the provider or facility as set forth in
                these interim final rules at 45 CFR 149.450.
                 Sections 9816(a)(1)(iv)(I) and 9817(a)(3)(A) of the Code, sections
                716(a)(1)(iv)(I) and 717(a)(3)(A) of ERISA, sections 2799A-
                1(a)(1)(iv)(I) and 2799A-2(a)(3)(A) of the PHS Act, and these interim
                final rules, require plans and issuers to send ``an initial payment or
                notice of denial of payment'' not later than 30 calendar days after a
                nonparticipating provider or facility submits a bill related to the
                items and services that fall within the scope of the new surprise
                billing protections for emergency services, non-emergency services
                performed by nonparticipating providers at participating facilities,
                and air ambulance services furnished by nonparticipating providers of
                air ambulance services. Given that plans and issuers cannot comply with
                this requirement unless the plan or issuer first determines that the
                billed items and services are covered under the plan or coverage, these
                interim final rules require that the plan or issuer make such
                determination not later than 30 calendar days after a nonparticipating
                provider or facility submits a bill related to the items and services
                that fall within the scope of the new surprise billing protections for
                emergency services, non-emergency services performed by
                nonparticipating providers at participating facilities, and air
                ambulance services furnished by nonparticipating providers of air
                ambulance services.
                 The Departments specify in these interim final rules that the 30-
                calendar-day period generally begins on the date the plan or issuer
                receives the information necessary to decide a claim for payment for
                such services, commonly known as a ``clean claim'' under many existing
                state laws. To the extent feasible, the Departments encourage providers
                and facilities to include information about whether the surprise
                billing protections apply to an item or service on the claim form
                itself. With respect to non-emergency services, HHS requires, under 45
                CFR 149.420(i), nonparticipating providers (or the participating
                facility on behalf of the nonparticipating provider) to timely notify
                the plan or issuer that the item or service was furnished during a
                visit at a participating health care facility. In addition, in all
                cases, under either 45 CFR 149.410(e) or 45 CFR 149.420(i), providers
                and facilities must notify the plan or issuer as to whether the
                requirements for notice and consent have been met when transmitting the
                bill, either on the bill or in a separate document. The Departments
                seek comments with recommendations on how HIPAA standard transactions
                to submit claims could be modified to accommodate the submission of
                several types of information on the claim itself. Specifically, the
                Departments seek comment on how HIPAA standard transactions to submit
                claims could be modified to include whether the surprise billing
                protections apply to the items and services included on a claim,
                whether the item or service was furnished during a visit at a
                participating health care facility, and whether the requirements for
                notice and consent have been met. The 30-calendar-day initial payment
                period also does not prohibit payments outside of the 30-calendar-day
                timeframe for any future adjustments for errors in payment, such as in
                cases of duplicate bills where providers and plans or issuers reconcile
                overpayments. The Departments expect that plans and issuers will act
                reasonably and in good faith when requesting additional information, by
                providing specific detail to help ensure that the claimant, provider,
                or facility understands what is required to perfect the claim. The
                Departments may specify additional standards if the Departments become
                aware of instances of abuse and gaming where plans and issuers are
                unduly delaying making an initial payment or sending a notice of denial
                to providers on the basis that the provider has not submitted a clean
                claim. The Departments solicit comment on whether any additional
                standards are necessary to prevent abusive claims payment practices.
                Under these interim final rules, a notice of denial of payment means,
                with respect to an item or service for which benefits are subject to
                the surprise billing protections, a written notice from the plan or
                issuer to the provider or facility that payment for the item or service
                will not be made by the plan or coverage and which explains the reason
                for denial. A notice of denial of payment could be provided, for
                example, if the item or service is covered but is subject to a
                deductible greater than the recognized amount.
                 In the Departments' view, the statute's reference to an ``initial''
                payment does not refer to a first installment. Rather, this initial
                payment should be an amount that the plan or issuer reasonably intends
                to be payment in full
                [[Page 36901]]
                based on the relevant facts and circumstances and as required under the
                terms of the plan or coverage, prior to the beginning of any open
                negotiations or initiation of the IDR process. In cases where the
                provider or facility is willing to accept the cost-sharing amount plus
                the initial payment (or the cost-sharing amount alone, in cases where a
                denial of payment is sent) as payment in full, this amount will be
                treated as the out-of-network rate. If plans and issuers make initial
                payments that providers and facilities are willing to accept (when
                combined with the cost-sharing amount) as payment in full, the
                administrative costs of determining the out-of-network amount will be
                significantly reduced through the avoidance of an open negotiation
                period and IDR process.
                 These interim final rules do not require plans and issuers, when
                making an initial payment to providers or facilities, to make any
                specific amount of minimum initial payment. However, several state
                balance billing laws set standards for minimum initial payment amounts.
                For example, in Washington State, issuers are required to pay an out-
                of-network provider or facility a commercially reasonable amount,
                reduced by the applicable cost-sharing amount, within 30 calendar days
                of receipt of a claim to which the state's balance billing protections
                apply. Requiring a minimum initial payment amount may help reduce the
                number of cases that go to arbitration in some states, and could help
                to reduce the number of cases that go to the federal IDR process
                established under the No Surprises Act.
                 The Departments seek comment on whether to set a minimum payment
                rate or methodology for a minimum initial payment in future rulemaking,
                and if so, what that rate or methodology should be. For example, a
                minimum payment rate could be a specific percentage of the Medicare
                rate, a specific percentage of the plan or issuer's QPA for the item or
                service, an amount calculated in the same way the plan or issuer
                typically calculates payment for the specific item or service to
                nonparticipating providers or facilities, an amount representing the
                highest amount that would result from applying two or more of these or
                other methodologies, or any other method. To the extent comments
                suggest that a percentage of a rate calculated or determined in a
                specific way would be appropriate, the Departments seek comment
                regarding an appropriate specific percentage. The Departments also seek
                comment on whether a minimum payment rate should be defined as a
                commercially reasonable rate based on payments for the same or similar
                services in a similar area, without requiring any specific methodology.
                In addition, the Departments seek comment regarding the impact of these
                provisions on underserved and rural communities, and other communities
                facing a shortage of providers.
                 The Departments are aware that the timeframes for deciding post-
                service claims under the claims and appeals rules issued under section
                2719 of the PHS Act and the timeframes for sending an initial payment
                or notice of denial of payment under these final rules may not always
                align. The Departments seek to minimize confusion about which types of
                disputes should be resolved through a plan or issuer's internal claims
                and appeals process instead of the IDR process established by the No
                Surprises Act.
                 The ERISA claims procedure regulation requires group health plans
                to notify a claimant of a benefit determination for post-service claims
                not later than 30 days after receipt of the claim. A plan can generally
                extend this period once for up to 15 days for matters beyond the
                control of the plan, including if the claimant fails to provide
                information necessary to decide the claim. In such cases, the plan may
                notify the claimant they provided insufficient information within 30
                days, and the plan must give the claimant at least 45 days to provide
                additional information. After the information is provided, the plan has
                15 days to make a determination. Claims that result in an adverse
                benefit determination (ABD) may be appealed within 180 days following
                receipt of the notice of the ABD. The requirements of the ERISA claims
                procedure regulation are incorporated by reference in the internal
                claims and appeals and external review requirements added by the
                Affordable Care Act to section 2719 of the PHS Act and, therefore,
                subject to limited exceptions, apply to all non-grandfathered group
                health plans and health insurance issuers offering non-grandfathered
                coverage in the group and individual markets.
                 If an initial claim submitted is a clean claim, the timeframes for
                making the relevant determinations would generally be aligned under
                these interim final rules and the ERISA claims procedure regulation.
                However, if a claim is submitted without sufficient information to make
                a benefit determination, under the ERISA claims procedure regulation,
                the plan would only have 15 days to make a determination once the claim
                is resubmitted with the additional information. Yet, under the No
                Surprises Act and these interim final rules, the plan would have up to
                30 calendar days to send a notice of denial of payment or an initial
                payment to the out-of-network provider from the time the claim is
                resubmitted with additional information. Consistent with the
                requirement that plans and issuers provide an initial payment or notice
                of denial of payment within 30 calendar days of a provider or facility
                submitting a clean claim, the Departments clarify that while the ERISA
                claims procedure regulation would require plans to make a benefit
                determination within 15 days of a claim being resubmitted with
                additional information, plans and issuers have 30 calendar days (which
                is an additional 15 days) to make an initial payment to an
                nonparticipating provider or facility, or send a separate notice of
                denial of payment.
                 The Departments note that there is also a significant distinction
                between an ABD, which may be disputed through a plan's or issuer's
                claims and appeals process, and a denial of payment or an initial
                payment that is less than the billed amount under these interim final
                rules, which may be disputed through the open negotiation process or
                through the IDR process. In general, when adjudication of a claim
                results in a participant, beneficiary, or enrollee being personally
                liable for payment to a provider or facility, this determination may be
                an ABD that can be disputed through a plan's or issuer's claims and
                appeals process. Conversely, when: (1) The adjudication of a claim
                results in a decision that does not affect the amount the participant,
                beneficiary, or enrollee owes; (2) the dispute only involves payment
                amounts due from the plan to the provider; and (3) the provider has no
                recourse against the participant, beneficiary, or enrollee, the
                decision is not an ABD and the payment dispute may be resolved through
                the open negotiation or the IDR process. This clarification is
                consistent with previous guidance included in FAQs related to the ERISA
                claims procedure regulation, which have explained that with respect to
                in-network benefits, the regulation does not apply to requests by
                health care providers for payments due to the provider, rather than due
                to the claimant, where the provider has no recourse against the
                claimant for amounts, in whole or in part, not paid by the plan.\67\
                The Departments
                [[Page 36902]]
                acknowledge that there may be instances where a participant,
                beneficiary, or enrollee appeals an ABD (such as, a determination of
                cost-sharing amounts) through the claims and appeals process
                concurrently with a provider's challenge to a payment amount through
                the IDR process.
                ---------------------------------------------------------------------------
                 \67\ See Benefit Claims Procedure Regulation FAQs, Q A-8,
                available at https://www.dol.gov/agencies/ebsa/about-ebsa/our-activities/resource-center/faqs/benefit-claims-procedure-regulation;
                see also Q C-12 (clarifying that failure to make payment in whole or
                in part due to the imposition of cost-sharing requirements is an
                ABD).
                ---------------------------------------------------------------------------
                4. Surprise Billing Complaints Regarding Group Health Plans and Health
                Insurance Issuers
                 Section 9816(a)(2)(B)(iv) of the Code, section 716(a)(2)(B)(iv) of
                ERISA, and section 2799A-1(a)(2)(B)(iv) of the PHS Act direct the
                Departments to establish a process to receive complaints regarding
                violations of the application of QPA requirements by group health plans
                and health insurance issuers offering group or individual health
                coverage. The Departments are of the view that, in order to effectively
                enforce the No Surprises Act balance billing protections, the
                complaints process should extend to all of the consumer protection and
                balance billing requirements as described in these interim final rules
                that apply to group health plans and health insurance issuers offering
                group or individual health coverage. As such, these interim final rules
                establish a process by which the Departments will receive complaints
                regarding violations by plans and issuers of the requirements under
                sections 9816 and 9817 of the Code, sections 716 and 717 of ERISA, and
                sections 2799A-1 and 2799A-2 of the PHS Act. The Departments seek
                comment on whether the complaints process should be restricted to the
                QPA or extended as described in these interim final rules.
                 The No Surprises Act also adds section 2799B-4(b)(3) of the PHS
                Act, which directs HHS to establish a process to receive consumer
                complaints regarding violations by health care providers, facilities,
                and providers of air ambulance services regarding balance billing
                requirements under sections 2799B-1, 2799B-2, 2799B-3, and 2799B-5 of
                the PHS Act and to respond to such complaints within 60 days. As such,
                HHS is issuing HHS-only interim final rules to establish a process by
                which HHS will receive complaints regarding violations of these
                requirements by health care providers, facilities, and providers of air
                ambulance services.
                 For purposes of the complaint processes for plans and issuers,
                providers, facilities, and providers of air ambulance services, these
                interim final rules define a complaint as a written or oral
                communication that indicates there has been a potential violation by a
                plan or issuer of sections 9816 or 9817 of the Code, sections 716 or
                717 of ERISA, or sections 2799A-1, 2799A-2 of the PHS Act, or a
                potential violation by a provider, facility, or provider of air
                ambulance services of sections 2799B-1, 2799B-2, 2799B-3 and 2799B-5 of
                the PHS Act, whether or not a violation actually occurred. A
                complainant means any individual, or their authorized representative,
                who files a complaint as defined in these interim final rules.
                 The Departments seek to minimize the burden of filing a complaint
                and seek to require only the information necessary to process the
                complaint and conduct an investigation if deemed necessary. Therefore,
                these interim final rules specify that the Departments will consider a
                complaint to be filed on the date on which the Departments receive an
                oral or written statement with information about the complaint
                sufficient to identify the parties involved (including the plan
                sponsor, if the complaint involves a group health plan), and the action
                or inaction that is the subject of the complaint. The information may
                also include the timing of the alleged violation, and the state where
                the alleged violation occurred. The Departments seek comment on the
                information needed to file a complaint, and the definitions in this
                section.
                 The Departments have considered whether a complaint should be filed
                within a defined amount of time of the alleged violation. The
                Departments understand that timely action is necessary to investigate
                and adjudicate billing matters and therefore considered whether
                complainants should be required to file a complaint regarding an
                alleged violation of the requirements in these interim final rules by a
                plan, issuer, health care provider or provider of air ambulance
                services within 90 or 180 calendar days after learning of the alleged
                violation. Without a time requirement for filing a complaint, the
                Departments may be restricted in directing the complainant to other
                state or federal resolution processes with timing requirements such as
                the internal and external claims review process as described in section
                2719 of the PHS Act, or an appropriate IDR process as defined in
                sections 9816 and 9817 of the Code, sections 716 and 717 of ERISA, and
                sections 2799A-1 and 2799A-2 of the PHS Act. However, the Departments
                are of the view that every complaint should be processed and
                investigated as appropriate to ensure that any necessary enforcement
                action can be taken. Therefore, these interim final rules do not
                include a time period upon which a complaint must be filed. The
                Departments seek comment on whether a complainant should be required to
                file a complaint within a given time period and if so within what time
                period a complaint should be filed for the purpose of this section.
                 Section 2799B-4 of the PHS Act directs HHS to respond to complaints
                regarding violations of balance billing protections by health care
                providers, facilities, and providers of air ambulance services within
                60 days of receipt. The Departments are of the view that the timing for
                responding to complaints regarding plans and issuers should be the same
                as that for providers to ensure timely resolution. Therefore, upon
                receiving the information necessary to file a complaint regarding a
                plan or issuer, the Departments will respond to complainants under
                section 9816(a)(2)(B)(iv) of the Code, section 716(a)(2)(B)(iv) of
                ERISA, and section 2799A-1(a)(2)(B)(iv) of the PHS Act no later than 60
                business days after the complaint is received. Similarly, HHS will
                respond to a processed complaint regarding a health care provider,
                facility, or provider of air ambulance services under section 2799B-4
                of the PHS Act no later than 60 business days after the complaint is
                received.
                 The response will be by oral or written means, and will acknowledge
                receipt of the complaint, notify the complainant of their rights and
                obligations under the complaints process, and describe the next steps
                of the complaint resolution process. The Departments may also request
                any additional information needed to process the complaint. The
                requested information may include an explanation of benefits, processed
                claims, information about the health care provider, facility, or air
                ambulance service involved; information about the plan or issuer
                covering the individual; information to support a determination
                regarding whether the service was an emergency service or non-emergency
                service; the summary plan description, policy, certificate, contract of
                insurance, membership booklet, outline of coverage or other evidence of
                coverage the plan or issuer provides to their participant, beneficiary,
                or enrollee; documents regarding asserted facts in the complaint that
                are in the possession of or otherwise attainable by the complainant; or
                any other information the Departments may need to make a determination
                of facts for an investigation.
                 HHS may also request additional information to process a complaint
                under section 2799B-4 of the PHS Act
                [[Page 36903]]
                regarding a health care provider, facility, or provider of air
                ambulance services. This information may include, but is not limited
                to, the bills or network status of a health care provider, health care
                facility, or provider of air ambulance services; information regarding
                the health care plan or health insurance coverage of a participant,
                beneficiary or enrollee; information to support a determination
                regarding whether the service was an emergency service or non-emergency
                service; documents that support the asserted facts in the complaint in
                the possession of, or otherwise attainable by the complainant; or any
                other information HHS needs to make a determination of facts for an
                investigation. The Departments seek comment on additional information
                that may be required to process a complaint.
                 The response may be provided directly upon receipt of the
                complaint, or it may be provided afterwards, though no later than 60
                business days after the complaint is received. The next steps of the
                complaint resolution process may include referring the complainant to
                another appropriate state or federal resolution process, referring a
                complainant to the state or federal regulatory authority with
                enforcement jurisdiction, or initiating an investigation for
                enforcement action. The Departments will make reasonable efforts
                consistent with agency practices to notify the complainant of the
                outcome of such investigations or enforcement actions, including an
                explanation of the findings, resolution, or any corrective action
                taken. The Departments will also make reasonable efforts to notify the
                complainant if the complaint is transferred to another state or Federal
                regulatory authority. The Departments seek comment on whether a
                complainant should receive the notification of the outcome of the
                complaint within a given time period and if so within what time period
                a complainant should receive the notice for the purpose of this
                section.
                 The Departments intend to provide the public with a seamless
                experience for filing complaints by creating one system to intake all
                complaints on behalf of all complainants under section
                9816(a)(2)(B)(iv) of the Code, section 716(a)(2)(B)(iv) of ERISA, and
                sections 2799A-1(a)(2)(B)(iv) and 2799B-4 of the PHS Act. The
                Departments understand that a complainant may not know which Department
                has enforcement jurisdiction; therefore, the Departments intend to
                provide one system that will direct complaints to the appropriate
                Department for processing, investigation, and enforcement action as
                necessary. The Departments will release guidance on where the public
                can file complaints and welcome comments on the operations,
                protections, user experience, or other facets of this complaint system.
                The Departments also seek comment on ways to ensure consumers are aware
                and know how to use this system.
                 The Departments seek to uphold Executive Order 13985 and all civil
                rights protections regarding non-discrimination and accessibility, as
                noted in prior sections. The Departments will make all reasonable
                efforts to implement a robust complaint process, including but not
                limited to, acknowledgement of receipt of a complaint, explanations of
                rights and information requested, explanations of findings, and
                referrals to other authorities. The Departments will ensure that the
                complaints process is accessible to all individuals, that communication
                and language needs are met, and that all individuals are able to
                understand the options available to them and information required of
                them. The Departments seek comment from individuals in underserved and
                rural communities, minority communities, and persons otherwise
                adversely affected by persistent poverty or inequality on specific
                barriers to the complaint process and solutions to address these
                barriers and ensure equitable access to all aspects of the complaint
                processes.
                C. Choice of Health Care Professionals
                 In the Patient Protections Final Rule, the Departments finalized
                regulations addressing the provisions in section 2719A of the PHS Act,
                regarding patient protections related to choice of health care
                professional and emergency services.\68\ As explained earlier, the No
                Surprises Act amended section 2719A of the PHS Act to sunset when the
                new emergency services protections under the No Surprises Act take
                effect. The provisions of section 2719A of the PHS Act will no longer
                apply with respect to plan years beginning on or after January 1,
                2022.\69\ The No Surprises Act re-codified the patient protections
                related to choice of health care professional in newly added section
                9822 of the Code, section 722 of ERISA, and section 2799A-7 of the PHS
                Act.
                ---------------------------------------------------------------------------
                 \68\ 80 FR 72191 (November 18, 2015).
                 \69\ Section 2719A(e) of the PHS Act states, ``The provisions of
                this section shall not apply with respect to a group health plan,
                health insurance issuers, or group or individual health insurance
                coverage with respect to plan years beginning on or on January 1,
                2022.'' The Departments interpret subsection (e) to sunset section
                2719A for plan years beginning on or after January 1, 2022.
                ---------------------------------------------------------------------------
                 To reflect these statutory amendments, these interim final rules
                add a sunset clause to the current patient protection provisions
                codified in the Patient Protections Final Rule, and re-codify the
                provisions related to choice of health care professional without
                substantive change at 26 CFR 54.9822-1T, 29 CFR 2590.722, and 45 CFR
                149.310. These interim final rules make minor technical edits to the
                original provisions for clarity.
                 The Departments note that, although the substantive requirements of
                these regulations have not changed, the No Surprises Act extends the
                applicability of the patient protections for choice of health care
                professionals to grandfathered health plans. The patient protections
                under section 2719A of the PHS Act apply to only non-grandfathered
                group health plans and health insurance issuers offering non-
                grandfathered group or individual health insurance coverage. In
                contrast, the patient protections under the No Surprises Act apply
                generally to all group health plans and group and individual health
                insurance coverage, including grandfathered health plans.\70\
                Therefore, the requirements regarding patient protections for choice of
                health care professional under these interim final rules will newly
                apply to grandfathered health plans for plan years beginning on or
                after January 1, 2022. Until the requirements under section 9822 of the
                Code, section 722 of ERISA, and section 2799A-7 of the PHS Act and
                these interim final rules become applicable, non-grandfathered group
                health plans and health insurance issuers offering non-grandfathered
                group or individual health insurance coverage must continue to comply
                with the applicable requirements under section 2719A of the PHS Act and
                its implementing regulations.
                ---------------------------------------------------------------------------
                 \70\ Section 2719A was added to the PHS Act by the Affordable
                Care Act. Section 1251 of the Affordable Care Act provides that
                certain requirements, including those in section 2719A of the PHS
                Act, do not apply to grandfathered health plans. The No Surprises
                Act does not include a comparable exception for grandfathered health
                plans. Furthermore, section 103(d)(2) of the No Surprises Act amends
                section 1251(a) of the Affordable Care Act to clarify that the new
                and recodified patient protections provisions, including those
                related choice of choice of health care professional, apply to
                grandfathered health plans.
                ---------------------------------------------------------------------------
                D. Applicability
                 These interim final rules generally apply to group health plans and
                health insurance issuers offering group or individual health insurance
                coverage with respect to plan years (in the
                [[Page 36904]]
                individual market, policy years) beginning on or after January 1, 2022.
                The term ``group health plan'' includes both insured and self-insured
                group health plans. Group health plans include private employment-based
                group health plans subject to ERISA, non-federal governmental plans
                (such as plans sponsored by states and local governments) subject to
                the PHS Act, and church plans subject to the Code. Individual health
                insurance coverage includes coverage offered in the individual market,
                through or outside of an Exchange, and includes student health
                insurance coverage as defined at 45 CFR 147.145. In addition, as
                discussed further in section V of the preamble, under the OPM interim
                final rules, FEHB carriers must comply with the Departments' interim
                final rules, subject to OPM regulation and contract provisions.
                 The No Surprises Act amended section 1251(a) of the Affordable Care
                Act to specify that sections 2799A-1, 2799A-2, and 2799A-7 of the PHS
                Act apply to grandfathered health plans for plan years beginning on or
                after January 1, 2022. Therefore, these interim final rules apply to
                grandfathered health plans (as defined in 26 CFR 54.9815-1251, 29 CFR
                2590.715-1251, and 45 CFR 147.140). In addition, these interim final
                rules apply to certain non-grandfathered health insurance coverage in
                the individual and small group markets with respect to which CMS has
                announced it will not take enforcement action with respect to certain
                specified market requirements even though the coverage is out of
                compliance with those requirements (sometimes referred to as
                grandmothered or transitional plans).\71\
                ---------------------------------------------------------------------------
                 \71\ CMS Insurance Standards Bulletin Series--INFORMATION--
                Extension of Limited Non-Enforcement Policy through 2022 (January
                19, 2021), available at https://www.cms.gov/files/document/extension-limited-non-enforcement-policy-through-calendar-year-2022.pdf.
                ---------------------------------------------------------------------------
                 These interim final rules do not apply to health reimbursement
                arrangements, or other account-based plans, as described in 26 CFR
                54.9815-2711(d)(6)(i), 29 CFR 2590.715-2711(d)(6)(i), and 45 CFR
                147.126(d)(6)(i), that make reimbursements subject to a maximum fixed
                dollar amount for a period, as the benefit design of such plans makes
                concepts related to surprise billing and choice of health care
                professionals inapplicable.
                 By statute, certain plans and coverage are not subject to these
                interim final rules. This includes a plan or coverage consisting solely
                of excepted benefits,\72\ as well as short-term, limited-duration
                insurance. Excepted benefits are described in section 9832 of the Code,
                section 733 ERISA, and section 2791 of the PHS Act. Under section
                2791(b)(5) of the PHS Act, short-term, limited-duration insurance is
                excluded from the definition of individual health insurance coverage
                and is, therefore, exempt from these interim final rules and the
                statutory provisions the regulations implement. Short-term, limited-
                duration insurance is defined in regulations at 26 CFR 54.9801-2, 29
                CFR 2590.701-2, and 45 CFR 144.103.
                ---------------------------------------------------------------------------
                 \72\ Section 9831 of the Code, section 9832 of ERISA, and
                section 2722 of the PHS Act.
                ---------------------------------------------------------------------------
                 These interim final rules do not apply to retiree-only plans. ERISA
                section 732(a) generally provides that part 7 of ERISA--and section
                9831(a) of the Code generally provides that chapter 100 of the Code--
                does not apply to plans with less than two participants who are current
                employees (including retiree-only plans, which cover less than two
                participants who are current employees). Title XXVII of the PHS Act, as
                amended by the Affordable Care Act, no longer contains a parallel
                provision at section 2721(a) of the PHS Act. However, as explained in
                prior rulemaking, HHS will not enforce the requirements of title XXVII
                of the PHS Act with respect to non-federal governmental retiree-only
                plans and encourages states to adopt a similar approach with respect to
                health insurance coverage of retiree-only plans.\73\ HHS intends to
                continue to follow this same approach, including with respect to the
                new market reforms established in the No Surprises Act.
                ---------------------------------------------------------------------------
                 \73\ 75 FR 34537, 34540 (June 17, 2010).
                ---------------------------------------------------------------------------
                 These interim final rules are generally applicable to traditional
                indemnity plans, meaning plans that do not have networks of providers
                or facilities. However, the Departments recognize that indemnity plans
                may have unique benefit designs that cause certain provisions of these
                interim final rules not to be relevant. For example, the requirements
                regarding balance billing for non-emergency services provided by
                nonparticipating providers at certain participating facilities would
                never be triggered if a plan does not have a network of participating
                facilities. On the other hand, such requirements could be triggered by
                plans that have participating facilities but do not have participating
                providers, either for certain provider types or at all. In addition,
                requirements that are unrelated to whether a plan or coverage has a
                network of participating providers or facilities, such as the
                requirement that emergency services be covered without the need for any
                prior authorization determination, even if the services are provided on
                an out-of-network basis, are applicable to traditional indemnity plans.
                 The Departments seek comment as to whether there are any other
                plans with unique benefit designs that should be exempt from all or
                some of these interim final rules.
                IV. Overview of Interim Final Rules--Department of Health and Human
                Services
                A. Preventing Surprise Medical Bills
                1. In General
                 In addition to the new provisions applicable to group health plans
                and health insurance issuers, discussed in section III of this
                preamble, the No Surprises Act adds a new Part E of title XXVII of the
                PHS Act establishing requirements applicable to health care providers,
                facilities, and providers of air ambulance services. Specifically, the
                No Surprises Act adds new sections 2799B-1, 2799B-2, 2799B-3, and
                2799B-5 of the PHS Act, which protect participants, beneficiaries, and
                enrollees in group health plans and group and individual health
                insurance coverage from balance bills by prohibiting nonparticipating
                providers, facilities, and providers of air ambulance services from
                billing or holding liable individuals for an amount that exceeds in-
                network cost sharing determined in accordance with the balance billing
                provisions in circumstances where the balance billing provisions apply.
                This includes: (1) When emergency services are provided by a
                nonparticipating provider or nonparticipating emergency facility; (2)
                when non-emergency services are provided by a nonparticipating provider
                at a participating health care facility; and (3) when air ambulance
                services are furnished by a nonparticipating provider of air ambulance
                services.
                 Under 5 U.S.C. 8902(p), as added by the No Surprises Act, sections
                2799B-1, 2799B-2, 2799B-3, and 2799B-5 of the PHS Act apply to a health
                care provider, a facility, and a provider of air ambulance services
                with respect to a covered individual in a health benefits plan offered
                by a FEHB carrier in the same manner as they apply with respect to a
                participant, beneficiary, or enrollee in a group health plan or group
                or individual health insurance coverage offered by a health insurance
                issuer. These interim final rules apply to a health care provider, a
                facility, and a provider of air ambulance services in
                [[Page 36905]]
                this same manner.\74\ The applicability of these interim final rules
                with respect to FEHB carriers is discussed in more detail in section V
                of this preamble.
                ---------------------------------------------------------------------------
                 \74\ For purposes of these interim final rules, references to
                participants, beneficiaries, and enrollees should be construed to
                include covered individuals in a FEHB plan.
                ---------------------------------------------------------------------------
                 With respect to post-stabilization services provided by
                nonparticipating emergency facilities or nonparticipating providers,
                and non-emergency services furnished by nonparticipating providers at
                participating health care facilities (including off-site
                nonparticipating providers who furnish items or services that an
                individual receives as part of a visit to such health care facility),
                the prohibitions on balance billing do not apply if certain notice is
                provided to the participant, beneficiary, or enrollee, and the
                individual acknowledges receipt of the information in the notice and
                consents to waive the balance billing protections with respect to the
                nonparticipating emergency facility or nonparticipating providers to
                which the notice and consent apply. Under the No Surprises Act and
                these interim final rules, with respect to certain types of non-
                emergency services furnished by nonparticipating providers in a
                participating health care facility, the notice and consent provisions
                do not apply, meaning the prohibitions on balance billing apply without
                exception.
                 Given that the statute and these interim final rules authorize HHS
                to impose civil money penalties on facilities and providers that
                violate these requirements, nonparticipating providers should take
                steps necessary to ensure compliance by, among other actions,
                determining whether a given item or service is being furnished under
                circumstances that would trigger the surprise billing protections. For
                example, nonparticipating providers furnishing non-emergency services
                at a facility must determine whether the facility is a participating
                health care facility to determine whether balance billing protections
                apply. Relatedly, nonparticipating providers and nonparticipating
                emergency facilities will need to timely communicate with plans and
                issuers regarding when the limitations on cost sharing in these interim
                final rules do not apply because the notice and consent criteria
                (described more fully elsewhere in this preamble) have been satisfied.
                These HHS interim final rules address the steps providers and
                facilities must take to ensure the balance billing and cost-sharing
                protections are applied appropriately and consistently with the
                statute.
                 HHS also recognizes that compliance with these requirements may
                require nonparticipating providers and nonparticipating emergency
                facilities to refrain from billing an individual directly, even in
                cases that are not subject to these requirements. For example, the
                protections applicable to non-emergency services provided by a
                nonparticipating provider in a participating health care facility apply
                only with respect to services for which benefits are provided or
                covered by the plan or coverage. A nonparticipating provider may not
                have the information necessary to determine whether the services are a
                covered benefit under the plan or coverage. As a result, the
                nonparticipating provider may need to bill the plan or issuer directly
                for the services in order to determine whether the protections apply.
                Otherwise, the provider risks violating the statute and these interim
                final rules by billing individuals. HHS understands that
                nonparticipating providers and facilities frequently bill individuals
                directly for out-of-network services, leaving the individual to submit
                the bill to the plan or coverage. HHS seeks comment on the impact this
                change will have on nonparticipating providers and facilities, and on
                plans and issuers receiving bills from nonparticipating providers and
                facilities.
                 In instances where a provider or facility does balance bill a
                participant, beneficiary, or enrollee for services in violation of the
                statute and these interim final rules, the Secretary of HHS (the
                Secretary) may impose civil money penalties in states where HHS is
                directly enforcing the balance billing provisions with respect to
                health care providers, facilities, and providers of air ambulance
                services. However, the statute provides that the Secretary shall waive
                the penalties with respect to a health care provider, facility, or
                provider of air ambulance services who does not knowingly violate, and
                should not have reasonably known it violated, the provisions, with
                respect to a participant, beneficiary, or enrollee, if such provider or
                facility, within 30 days of the violation, withdraws the bill that was
                in violation of such provision and reimburses the health plan or
                individual, as applicable, in an amount equal to the difference between
                the amount billed and the amount allowed to be billed under the
                provision, plus interest, at an interest rate determined by the
                Secretary. HHS intends to address enforcement of the requirements of
                the No Surprises Act applicable to health care providers, facilities,
                and providers of air ambulance services in future rulemaking.
                2. Notice and Consent Exception to Prohibition on Balance Billing
                 Under the No Surprises Act and these interim final rules, the
                protections that limit cost sharing and prohibit balance billing do not
                apply to certain non-emergency services or to certain post-
                stabilization services provided in the context of emergency care, if
                the nonparticipating provider or nonparticipating emergency facility
                furnishing those items or services provides the participant,
                beneficiary, or enrollee, with notice, the individual acknowledges
                receipt of the information in the notice, and the individual consents
                to waive the balance billing protections with respect to the
                nonparticipating emergency facility or nonparticipating providers named
                in the notice.
                 Non-emergency services furnished by a nonparticipating provider at
                a participating health care facility are exempt from cost sharing
                protections and balance billing protections when the notice and consent
                requirements are met. In contrast, the notice and consent exception
                does not apply to emergency services, other than post-stabilization
                services, under certain circumstances, or air ambulance services. A
                nonparticipating provider or nonparticipating emergency facility may
                obtain notice and consent from the individual in order to balance bill
                for post-stabilization services only in the case where a participant,
                beneficiary, or enrollee has received emergency services and that
                individual's condition has stabilized, and then only if certain
                additional conditions are met. Such conditions are described later in
                this preamble and codified at 45 CFR 149.410(b).
                 If an individual receives a notice, but does not provide (or
                revokes) consent to waive their balance billing protections, those
                protections remain in place. A provider or facility may, subject to
                other state or federal laws, refuse to treat the individual if the
                individual does not consent.\75\ However, the cost-sharing and balance
                billing protections applicable to plans, issuers, providers and
                facilities would apply with respect to any items or services furnished
                by the provider or facility subsequent to the
                [[Page 36906]]
                provision of the notice, and absent consent.
                ---------------------------------------------------------------------------
                 \75\ HHS is aware that some providers and facilities charge fees
                for cancelled appointments. HHS is of the view that an individual
                cannot provide consent freely if a provider or facility will require
                the individual to pay a fee if the appointment is cancelled because
                the individual refuses or revokes consent.
                ---------------------------------------------------------------------------
                 The requirements related to the notice and consent exception are
                set forth in section 2799B-2 of the PHS Act, as added by the No
                Surprises Act, and implemented at 45 CFR 149.410 and 45 CFR 149.420 of
                the HHS interim final rules, describing the requirements for post-
                stabilization services and non-emergency services, respectively. These
                interim final rules outline the requirements related to the content,
                method, and timing of the notice and consent communications;
                requirements related to language access; exceptions to the
                applicability of the notice and consent process; requirements for the
                retention of notice and consent documents; and requirements to notify
                the plan or issuer regarding consent provided by the participant,
                beneficiary, or enrollee.
                i. Standards for Notice
                 The No Surprises Act and these interim final rules allow an
                individual to waive balance billing protections only after receiving a
                written notice that includes detailed information designed to ensure
                that individuals knowingly accept out-of-pocket charges (including
                charges associated with balance bills) for care received from a
                nonparticipating provider or nonparticipating emergency facility. In
                HHS's view, the option to consent to waive balance billing protections
                may be valuable to individuals in certain instances where they
                knowingly and purposefully seek care from a nonparticipating provider.
                For example, an individual with a complex health condition may want to
                be treated by a specialist who is not in their plan's network. If that
                specialist will not treat the individual unless the specialist can bill
                the individual directly for the care (and balance bill the individual),
                that individual may want to waive the balance billing protections. HHS
                seeks comment on striking the appropriate balance between allowing a
                specialist to refuse to treat an individual unless the specialist can
                balance bill the individual, while ensuring that the individual is not
                being pressured into waiving the balance billing protections. In HHS's
                view, it is important that these consumer protections do not present a
                barrier to obtaining out-of-network care, when an individual knowingly
                seeks out such care. However, it is equally important that individuals
                are not unknowingly subject to balance billing. Therefore, the No
                Surprises Act and these interim final rules allow an individual to
                waive balance billing protections in limited circumstances only, and
                only if the nonparticipating providers or nonparticipating emergency
                facility have provided the participant, beneficiary, or enrollee with
                appropriate notice explaining the applicable consumer protections and
                the implications of providing consent.
                 Section 2799B-2(d)(1)(A) of the PHS Act requires providers and
                facilities to use a written notice specified by HHS in guidance.
                Therefore, these interim final rules require providers and facilities
                to provide the notice using the standard notice document provided by
                HHS in guidance. The standard notice document will contain the elements
                required by the statute in a manner that is intended to be easy to read
                and comprehend. The notice must be provided in accordance with guidance
                issued by HHS. HHS is of the view that requiring use of the standard
                notice will help to ensure that the notice includes the content that is
                required to be included in the notice under the No Surprises Act and
                these interim final rules. Providers and facilities will need to tailor
                the document in each case to include information specific to the
                individual (for example, by identifying the provider or facility, as
                applicable, and adding the good faith estimated amount).
                 HHS is concerned that individuals may be less likely to review the
                notice carefully if it is embedded within other information or provided
                with additional consent forms. Therefore, these interim final rules
                require that the notice be provided with the consent document, and
                together these documents be given physically separate from, and not
                attached to or incorporated into any other documents. Providers and
                facilities must provide the notice within the required timeframe. The
                notice must be written and provided on paper, or, as practicable,
                electronically, as selected by the individual. The notice must meet
                applicable language access requirements, as described in this HHS
                interim final rule. A participating health care facility may provide
                the notice on behalf of the nonparticipating provider.\76\
                ---------------------------------------------------------------------------
                 \76\ However, if a facility that has agreed to provide the
                notice on behalf of the nonparticipating provider fails to provide
                the notice and obtain consent, or provides notice and obtains
                consent in a manner that does not satisfy the regulatory
                requirements in these interim final rules, the notice and consent
                criteria would not be considered to be met. Therefore, the cost-
                sharing and balance billing protections would continue to apply to
                the items and services furnished by the nonparticipating provider.
                ---------------------------------------------------------------------------
                Authorized Representatives
                 The notice may be provided to the individual's authorized
                representative instead of the individual, and consent may be provided
                by the authorized representative on behalf of the individual. These
                interim final rules specify that for purposes of 45 CFR 149.410 and
                149.420, an authorized representative is an individual authorized under
                state law to provide consent on behalf of the participant, beneficiary,
                or enrollee, provided that the individual is not a provider affiliated
                with the facility or an employee of the facility, unless such provider
                or employee is a family member of the participant, beneficiary, or
                enrollee. Although treating providers may be authorized under state law
                to provide consent to treatment, HHS is of the view that providers
                should generally not be permitted to receive notice or provide consent
                regarding treatment by a nonparticipating provider or facility because
                of the strong likelihood of an inherent financial or professional
                conflict of interest. These same concerns extend to employees of the
                facility at which the items or services are furnished. HHS is also of
                the view that these concerns are not warranted for providers or
                facility employees that are family members of the individual, because
                of their presumed interest in the well-being of the individual, or
                providers that are unaffiliated with the provider or facility
                furnishing the care. HHS is of the view that these limitations provide
                important consumer protections to ensure that an individual's
                authorized representative is acting in the individual's best interest
                rather than the interests of the provider or facility. HHS seeks
                comment on whether and how the term ``family member'' should be
                defined. HHS is sensitive to concerns that some individuals may not
                have a familial relation formally recognized under applicable state
                law, or other documented legal partnership with individuals whom they
                consider family. Therefore, when interpreting this requirement, HHS
                will construe the term ``family member'' broadly to include such
                individuals prior to the issuance of additional guidance.
                Timing of Notice
                 In order to ensure that a participant, beneficiary, enrollee, or
                authorized representative has an opportunity to properly review and
                consent to a notice to receive items or services furnished by a
                nonparticipating provider or nonparticipating emergency facility and
                waive balance billing protections, the provider or facility must
                provide such a notice in the timeframe specified in the statute and
                this interim final rule. As specified in section 2799B-2(d) of the PHS
                Act, if an individual schedules an
                [[Page 36907]]
                appointment for such items or services at least 72 hours before the
                date of the appointment, the provider or facility must provide the
                notice to the individual, or their authorized representative, no later
                than 72 hours before the date of the appointment; and if an individual
                schedules an appointment for such items or services within 72 hours of
                the date of the appointment, the provider or facility must provide the
                notice to the individual, or their authorized representative, on the
                day that the appointment is made. In addition, these interim final
                rules specify that in the situation where an individual is provided the
                notice on the same day that the items or services are furnished,
                providers and facilities are required to provide the notice no later
                than 3 hours prior to furnishing items or services to which the notice
                and consent requirements apply.
                 This 3-hour requirement is intended to address situations where an
                individual might be asked to provide consent immediately before a
                provider furnishes the item or service, which may prevent their consent
                from being truly voluntary. Stakeholders have recommended that notice
                and consent procedures be unavailable when an individual visits a
                participating facility and receives care from a nonparticipating
                provider from whom the individual did not seek out services (for
                example, if a specialist furnishes an unexpected consultation on the
                recommendation of the attending physician). Stakeholders expressed
                concern that such providers might provide the notice at the time they
                appear for the consultation, and the individual might feel compelled to
                consent to receive care. HHS is of the view that the requirement that
                the notice be provided no later than 3 hours prior to furnishing items
                or services helps to ensure individuals can voluntarily provide
                informed consent, while not removing the informed consent option
                entirely in instances where the appointment is made the same day as the
                date the services are scheduled. HHS seeks comment on whether such a
                time limit is a reasonable approach, as well as whether the 3 hours'
                time requirement should be shorter or longer, in order to best ensure
                that consent is freely given while also facilitating timely access to
                care. For example, HHS is interested in understanding if there are
                situations where this time requirement may unduly delay access to
                urgently necessary care, including in the post-stabilization care
                context.\77\ Alternatively, HHS is interested in understanding if more
                time may be necessary for an individual to read, understand, and
                consider their options, including considering whether they can resolve
                prior authorization or other care management limitations, before
                voluntarily consenting to treatment. HHS is also interested in whether
                these timing requirements present barriers to providers' and
                facilities' ability to comply with the requirement that the notice and
                consent documents be provided to the individual in paper or, as
                practicable, electronic form, as selected by the individual.
                ---------------------------------------------------------------------------
                 \77\ A provider or facility is never required to provide notice
                and seek consent from a participant, beneficiary, or enrollee. To
                the extent a provider is concerned that the 3 hours' prior
                requirement will result in a delay in care that is detrimental to
                the individual, the provider or facility can furnish the items or
                services, subject to the balance billing protections, rather than
                providing notice and seeking consent to waive the protections.
                ---------------------------------------------------------------------------
                Content of Notice
                 As stated previously, a provider or facility must provide the
                written notice using the form specified by HHS in guidance, customized
                to include the information specified in 45 CFR 149.420(d) (and 45 CFR
                149.410(b)(2), for post-stabilization services, as applicable).
                 The notice must state that the health care provider furnishing the
                items or services is a nonparticipating provider, or that the health
                care facility furnishing the items or services is a nonparticipating
                emergency facility, as applicable, with respect to the health plan or
                coverage. The provider or facility will need to customize the form to
                identify the provider or facility by name. This will help ensure
                individuals understand for which specific providers or facilities they
                would be waiving their balance billing protections.
                 The notice must include the good faith estimated amount that such
                nonparticipating provider or nonparticipating emergency facility may
                charge the individual for the items and services involved, including
                any item or service that the nonparticipating provider reasonably
                expects to provide in conjunction with such items and services. In the
                case of a nonparticipating emergency facility, the notice must include
                the good faith estimate for such items or services that would
                reasonably be expected to be provided by the nonparticipating emergency
                facility or by nonparticipating providers as part of the visit at such
                facility. HHS is including the requirement regarding disclosing items
                and services reasonably expected to be provided in order to ensure that
                the participant, beneficiary, or enrollee has an accurate understanding
                of the cost of care. As discussed in section IV.A.2.iv of this
                preamble, individuals cannot waive the balance billing protections for
                items or services furnished as a result of unforeseen, urgent medical
                needs that arise at the time an item or service is furnished for which
                the nonparticipating provider or nonparticipating facility satisfied
                the notice and consent criteria.
                 Nonparticipating providers who are providing this notice are
                required to provide a good faith estimate for only the items or
                services that they would be furnishing and are not required to provide
                a good faith estimate for items or services furnished by other
                providers at the facility. However, if a nonparticipating provider has
                not satisfied the notice and consent criteria, balance billing and
                cost-sharing protections will apply to the individual with respect to
                items and services furnished by that nonparticipating provider, even if
                a different nonparticipating provider has satisfied the notice and
                consent criteria with respect to the same visit. If they choose,
                multiple nonparticipating providers that are furnishing related items
                and services for an individual may provide a single notice to the
                individual, provided that: (1) Each provider's name is specifically
                listed on the notice document; (2) each provider includes in the notice
                a good faith estimate for the items and services they are furnishing,
                and the notice specifies which provider is providing which items and
                services within the good faith estimate; and (3) the individual has the
                option to consent to waive balance billing protections with respect to
                each provider separately.
                 HHS is of the view that an individual cannot consent to waive
                balance billing and cost-sharing protections unless they have been
                informed of their potential liability with respect to both the facility
                and provider charges related to receiving post-stabilization services
                at a nonparticipating emergency facility. Therefore, nonparticipating
                emergency facilities must include in the written notice the good faith
                estimated amount that the participant, beneficiary, or enrollee may be
                charged for items or services furnished by the nonparticipating
                emergency facility or by nonparticipating providers with respect to the
                visit at such facility (including any item or service that is
                reasonably expected to be furnished by the nonparticipating emergency
                facility or nonparticipating providers in conjunction with such items
                or
                [[Page 36908]]
                services). HHS seeks comment regarding potential challenges
                nonparticipating emergency facilities may have in coordinating the
                development of a good faith estimate on behalf of both the facility and
                providers. To the extent that the nonparticipating facility omits from
                the good faith estimate information about items and services provided
                by a nonparticipating provider, the notice and consent criteria will be
                not be considered met for items and services furnished by that
                provider, and the requirements in 45 CFR 149.410(a) (and the
                corresponding requirements on plans and issuers) would apply.
                 HHS is aware that nonparticipating providers and nonparticipating
                emergency facilities generally are unable to calculate what an
                individual's final out-of-pocket costs (inclusive of balance bills)
                will be for items and services partially or wholly covered by the
                individual's plan or coverage. Therefore, the good faith estimated
                amount should reflect the amount the provider or facility expects to
                charge for furnishing such items or services, even if the provider or
                facility intends to bill the plan or coverage directly. In calculating
                this good faith estimated amount, the provider or facility is expected
                to apply the same process and considerations used to calculate the good
                faith estimate that is required under section 2799B-6(2) of the PHS
                Act. HHS seeks comment regarding the method by which this good faith
                estimated amount should be calculated, and anticipates addressing this
                requirement in future rulemaking. The notice must make clear that the
                provision of the good faith estimate in the notice, or the individual's
                consent to be treated, does not constitute a contract with respect to
                the charges estimated for such items and services, or a contract that
                binds the participant, beneficiary, or enrollee to be treated by that
                provider or facility. HHS seeks comment regarding whether the provider
                or the facility should be required to include information about what
                may be covered by the individual's plan or coverage and an estimate of
                the individual's out-of-pocket costs.
                 The notice must provide information about whether prior
                authorization or other care management limitations may be required in
                advance of receiving such items or services at the facility or from the
                provider. HHS recognizes that there may be challenges for
                nonparticipating providers or facilities to identify what prior
                authorization and other care management limitations may apply with
                respect to a plan or coverage in which they do not participate.
                Therefore, providers and facilities may provide general information in
                order to satisfy this requirement, but to the extent possible, HHS
                encourages them to contact the issuer or plan about any such
                limitations so that they can include specific information in the
                notice. HHS interprets this statutory provision to require information
                on prior authorization or care management requirements to extend to
                care furnished by both providers and facilities, in order for
                participants, beneficiaries, and enrollees to understand all
                requirements associated with their care before they consent to
                treatment and balance billing. Requiring that the notice include
                specificity regarding prior authorization or care management
                requirements could improve the usefulness of the information to
                individuals compared to general information about what requirements may
                apply, but may make providing notices overly burdensome for providers
                and facilities. HHS seeks comment on whether providers and facilities
                should instead be required to include in the notice specific
                information about any prior authorization and care management
                requirements that apply to any items and services covered under the
                notice. HHS also seeks comment on barriers or other burdens facing
                nonparticipating providers or facilities in obtaining this information
                from a plan or issuer.
                 The notice must clearly state that the individual is not required
                to consent to receive such items or services from such nonparticipating
                provider or nonparticipating emergency facility. The notice must state
                that the individual may instead seek care from an available
                participating provider or at a participating emergency facility, with
                respect to the plan or coverage, as applicable, and that in such cases,
                in-network cost-sharing amounts will apply.
                 In cases where post-stabilization services are being furnished by a
                nonparticipating provider at a participating emergency facility, the
                notice must include a list of any participating providers at the
                participating emergency facility who are able to furnish the items or
                services involved. The notice must inform the individual that they may
                be referred, at their option, to such a participating provider. HHS
                seeks comment regarding the format and content of the referral list to
                be included in the notice, including any challenges that providers may
                have in providing this information, and any further requirements that
                should be applied to providers when furnishing this information to the
                individual.
                ii. Standards for Consent
                 In order to meet the notice and consent requirements of the No
                Surprises Act and these interim final rules, the nonparticipating
                provider, participating health care facility on behalf of the
                nonparticipating provider, or nonparticipating emergency facility must
                obtain from the participant, beneficiary, or enrollee the individual's
                acknowledgment that they consent to be treated and balance billed by
                the nonparticipating emergency facility or nonparticipating provider
                under circumstances where the individual elects to receive such items
                or services. The consent must be provided voluntarily, meaning that the
                individual has consented freely, without undue influence, fraud, or
                duress. An incomplete consent document will be treated as a lack of
                consent and balance billing protections will still apply.
                 As with the notice document, providers and facilities must use the
                standard consent document specified by HHS in guidance, and the consent
                document must be provided in accordance with such guidance. The consent
                document, specified in guidance, contains the information (or fillable
                fields for the information) required to be included in the consent form
                under these interim final rules, and described further in this section
                of the preamble. Providers and facilities will need to tailor the
                document to include information specific to the individual. In
                addition, as discussed previously, these interim final rules require
                that the consent be accompanied by the notice document, and that these
                documents be given together at the same time, physically separate from
                and not attached to or incorporated into any other documents. The
                consent document must be signed (including by electronic signature) by
                the individual, or the individual's authorized representative.
                 The nonparticipating provider, participating health care facility
                on behalf of the nonparticipating provider, or nonparticipating
                emergency facility must provide the individual with a copy of the
                signed notice and consent in-person, or through mail or email, as
                selected by the individual.
                 The notice and consent documents must meet applicable language
                access requirements, as described in these interim final rules. The
                signed consent document must acknowledge that the individual has been
                provided with the written notice as described in these interim final
                rules, in the form selected by the individual. The signed consent
                document must also acknowledge that
                [[Page 36909]]
                the individual has been informed that the payment made by the
                individual might not accrue toward meeting any limitation that the plan
                or coverage places on cost sharing, including an explanation that the
                payment might not apply to an in-network deductible or out-of-pocket
                maximum under the plan or coverage.
                 The consent document must state that, by signing the consent
                document, the individual agrees to be treated by the nonparticipating
                provider or nonparticipating emergency facility and understands that
                the individual may be balance billed and subject to cost-sharing
                requirements that apply to services furnished by nonparticipating
                providers or nonparticipating emergency facilities. In the case of a
                nonparticipating provider seeking consent, by signing the consent
                document, the individual agrees to waive balance billing and cost-
                sharing protections for only the items or services furnished by the
                provider or providers specifically named in the notice. In HHS's view,
                an individual cannot provide informed consent to waive balance billing
                protections with respect to an unnamed provider, as the individual
                would not be on notice that the individual may be balance billed for
                items or services furnished by that provider. In addition, the
                individual may choose to consent to waive balance billing protections
                with respect to items or services furnished by none, some, or all of
                the nonparticipating providers listed in the notice.
                 The signed consent document must include the date on which the
                individual received the written notice and the date on which the
                individual signed such consent to be furnished the items or services
                covered in the notice. In order to ensure that consent is provided
                prior to when the item or service is received, HHS also requires that
                the signed consent document include the time at which the individual
                signed the consent.
                 The signed consent provided by the individual constitutes the
                individual's consent to the receipt of the information contained in the
                notice document, and includes an acknowledgement that they may be
                balance billed for the receipt of the items or services. The consent
                does not constitute a contractual agreement with regard to any
                estimated charge or amount included in the notice or consent document,
                or a contract that binds the participant, beneficiary, or enrollee to
                be treated by that provider or facility. Consent obtained by the
                provider or facility under this notice and consent process in no way
                substitutes for or modifies requirements for informed medical consent
                otherwise required of the provider or facility, under state law or
                codes of medical ethics.
                 The participant, beneficiary, or enrollee may revoke consent by
                notifying the provider or facility in writing prior to the furnishing
                of the items or services. If an individual revokes consent, the balance
                billing protections apply to applicable items or services provided
                after the revocation as if consent was never provided. HHS is of the
                view that the option to revoke consent is a critical safeguard to
                ensure that balance billing protections are waived only when
                individuals knowingly, purposefully, and freely provide informed
                consent. HHS seeks comment on whether additional rulemaking or guidance
                is needed on how an individual can revoke consent.
                iii. Language Access
                 A nonparticipating provider or nonparticipating emergency facility
                providing a participant, beneficiary, or enrollee, or such individual's
                authorized representative, with a notice under section 2799B-2(d) of
                the PHS Act must make the notice available in any of the 15 most common
                languages in the geographic region in which the applicable facility is
                located. HHS is of the view that individuals cannot provide meaningful
                consent if they cannot understand the information provided in the
                written notice and consent documents. These interim final rules,
                therefore, also require that the notice and consent document be made
                available in any of the 15 most common languages in the geographic
                region in which the applicable facility is located. Providers and
                facilities will need to translate the standard notice and consent
                documents specified by HHS in guidance into the applicable 15
                languages.
                 A provider or facility meets this requirement if it provides the
                notice and consent documents in the 15 most common languages in its
                state. However, HHS recognizes that in some cases, particularly in
                larger states or metropolitan areas, these 15 languages may not
                adequately represent the languages spoken by the population served by
                the provider or facility.\78\ Therefore, the provider or facility may
                alternatively choose to provide the notice and consent documents in the
                15 most common languages in its geographic region, which reasonably
                reflects the geographic region served by the applicable facility. For
                example, a facility that serves the greater Los Angeles area may choose
                to provide the notice and consent documents in the 15 most common
                languages within that geographic region, instead of the 15 most common
                languages in the state of California.
                ---------------------------------------------------------------------------
                 \78\ See, e.g., ``Understanding Communication and Language Needs
                of Medicare Beneficiaries'' (2017), https://www.cms.gov/About-CMS/Agency-Information/OMH/Downloads/Issue-Briefs-Understanding-Communication-and-Language-Needs-of-Medicare-Beneficiaries.pdf
                (``The common languages in a given region, city, or town may vary
                greatly from those spoken in the state or in the U.S. as a
                whole.'').
                ---------------------------------------------------------------------------
                 HHS considered different standards to apply in defining such
                geographic regions, and is seeking comment regarding the appropriate
                standard. HHS's objective is to implement a standard that ensures that
                the language accessibility requirement is responsive to the needs of
                the individuals served by the provider or facility, while mitigating
                inconsistencies in the way that such geographic regions are determined.
                HHS is interested in comments regarding the use of metropolitan
                statistical areas (MSAs),\79\ hospital service areas (HSAs),\80\
                hospital referral regions (HRRs),\81\ and public use microdata areas
                (PUMAs),\82\ applied based on where the applicable facility is located,
                as well as other standards that may be well-suited for this purpose.
                HHS also seeks comment on what language access standards would be
                appropriate in circumstances where the applicable facility serves
                populations in multiple states.
                ---------------------------------------------------------------------------
                 \79\ https://www.census.gov/programs-surveys/metro-micro/about.html.
                 \80\ https://www.dartmouthatlas.org/faq/.
                 \81\ https://www.dartmouthatlas.org/faq/.
                 \82\ https://www.census.gov/programs-surveys/geography/guidance/
                geo-areas/
                pumas.html#:~:text=Public%20Use%20Microdata%20Areas%20(PUMAs)%20are%2
                0non% 2Doverlapping%2C,and%20the%20U.S.%20Virgin%20Islands.
                ---------------------------------------------------------------------------
                 As noted earlier in this section, HHS is of the view that
                individuals cannot provide meaningful consent if they cannot understand
                the information provided in the written notice and consent document.
                These interim final rules, therefore, add a language access requirement
                to address circumstances in which the individual cannot understand any
                of the 15 languages in which the notice and consent document are
                available. If the individual's preferred language is not among the 15
                most common languages in which the documents are made available by the
                nonparticipating provider or nonparticipating emergency facility, or
                the individual cannot understand the language in which the notice and
                consent documents are provided, as self-reported by the individual, the
                [[Page 36910]]
                notice and consent requirements described in these interim final rules
                are not met unless the provider or facility furnishes the individual
                with a qualified interpreter.
                 The provider or facility should provide the notice and consent
                documents, or the qualified interpretive services, as applicable, in
                the individual's self-reported, preferred language. Individuals should
                be asked what language they prefer to communicate in regarding health
                care information, for written or verbal communication, as applicable.
                An individual's preference might not be the same for written and verbal
                communication, and an individual's preference might not correlate with
                the individual's native language.
                 In interpreting the statutory requirements regarding language
                access in the notice and consent process, HHS recognizes communication,
                language, and literacy barriers are associated with decreased quality
                of care, poorer health outcomes, and increased utilization.\83\
                Alternatively, the use of appropriate language services and at
                appropriate literacy levels in health care settings is associated with
                increased quality of care, improved patient safety outcomes, and lower
                utilization of costly medical procedures.\84\ HHS is of the view that
                it is imperative that health care providers and facilities take these
                efforts to provide the required notice and consent information in a
                manner understandable to the participant, beneficiary, or enrollee, to
                help achieve the goal of the statute and ensure that individuals are
                aware their rights and the options available to them.
                ---------------------------------------------------------------------------
                 \83\ Batencourt, J.R., et al., Improving Patient Safety Systems
                for Patients with Limited English Proficiency: A Guide for
                Hospitals, Agency for healthcare Research and Quality, Publication
                No. 12-0041, September 2012; Proctor, K. et al., The Limited English
                Proficient Population: Describing Medicare, Medicaid, and Dual
                Beneficiaries, Health Equity Vol. 2.1, 2018; Green, A.R. and Nze, C.
                Language-Based Inequity in Health Care: Who is the ``Poor
                Historian''?, American Medical Association Journal of Ethics, Vol.
                19, Number 3: 263-271, March 2017; Shamsi, H. et al., Implications
                of Language Barriers for Healthcare: A Systematic Review, Oman
                Medical Journal, Vol. 53, No. 2:e122, 2020; de Moissac, D., Bowen,
                S., Impact of Language Barriers on Quality of Care and Patient
                Safety for Official Language Minority Francophones in Canada,
                Journal of Patient Experience, Vol. 6(1) 24-32, 2019; Napoles, A.N.,
                et al., Inaccurate Language Interpretation and its Clinical
                Significance in the Medical Encounters of Spanish-speaking Latinos,
                Med Care. 2015 November; 53(11): 940-947; Divi, C., et al., Language
                Proficiency and Adverse Events in U.S. Hospitals: a Pilot Study,
                Int'l Journal for Quality in Health Care, vol. 19, no.2; Ali, P.A.
                and Watson, R., Language Barriers and their Impact of Provision of
                Care to Patients with Limited English Proficiency: Nurses
                Perspective, J. Clin. Nurs., 2018 Mar;27(5-6); Flores G. Language
                barriers to health care in the United States. N Engl J Med 2006;
                355:229-231. Ku L, and Flores G. Pay now or pay later: Providing
                interpreter services in health care. Health Affairs. 2005;24(2):
                435-444; Hampers L.C., et al. Language barriers and resource
                utilization in a pediatric emergency department. Pediatrics. 1999;
                103(6): 1253-1256; Dewalt D.A., et al. Literacy and health outcomes:
                A systematic review of the literature. J. Gen Intern Med.
                2004;19(12):1228-1239. doi:10.1111/j.1525-1497.2004.40153.x.
                 \84\ Id.
                ---------------------------------------------------------------------------
                 Providers and facilities are also required to comply with other
                state and federal laws regarding language access, to the extent
                applicable. HHS reminds health care providers and facilities that
                recipients of federal financial assistance must comply with federal
                civil rights laws that prohibit discrimination. These laws include
                section 1557 of the Affordable Care Act,\85\ title VI of the Civil
                Rights Act of 1964,\86\ section 504 of the Rehabilitation Act of
                1973,\87\ and the Americans with Disabilities Act of 1990.\88\ Section
                1557 and title VI require covered entities to take reasonable steps to
                ensure meaningful access to individuals with limited English
                proficiency, which may include provision of language assistance
                services such as written translation of written content in paper or
                electronic form into languages other than English. Section 1557 and
                section 504 require covered entities to take appropriate steps to
                ensure effective communication with individuals with disabilities,
                including provision of appropriate auxiliary aids and services at no
                cost to the individual. Auxiliary aids and services may include
                interpreters, large print materials, accessible information and
                communication technology, open and closed captioning, and other aids or
                services for persons who are blind or have low vision, or who are deaf
                or hard of hearing. Information provided through information and
                communication technology also must be accessible to individuals with
                disabilities, unless certain exceptions apply. Consistent with
                Executive Order 13985 and civil rights protections cited in these
                regulations, HHS particularly seeks comments from minority and
                underserved communities including those with limited English
                proficiency and those with disabilities who prefer information in
                alternate and accessible formats, and stakeholders who serve such
                communities, on whether the provisions and protections related to
                communication, language, and literacy sufficiently address barriers
                that exist to ensuring all individuals can read, understand, and
                consider their options related to notice and consent. HHS also seeks
                comment on what additional or alternate policies HHS may consider to
                help address and remove such barriers.
                ---------------------------------------------------------------------------
                 \85\ 42 U.S.C. 18116.
                 \86\ 42 U.S.C. 2000d et seq.
                 \87\ 269 U.S.C. 794.
                 \88\ 42 U.S.C. 12101 et seq.
                ---------------------------------------------------------------------------
                 HHS understands that the technical nature of these protections may
                inherently pose barriers to individuals or their authorized
                representatives as they consider their options. Numerous studies have
                indicated that consumer comprehension of common health insurance
                concepts is varied and that many are not able to accurately answer
                questions about their health plan's benefit design or health care
                costs.\89\ Individuals may also face intersecting and overlapping
                barriers (commonly referred to as the Social Determinants of Health) as
                they interact with the health care system, in addition to numerous
                technical forms and documents as part of receiving care. HHS solicits
                comment on how to best strike the balance between consumer friendliness
                and usability of such documents, while ensuring that they are
                consistent with these interim final rules and the statutory intent. HHS
                specifically seeks comment from those with experience in supporting
                individuals with low health literacy, including providers, patient
                advocates, and navigators, as well as those with experience in user
                design, in order to ensure that documents conveying these protections
                and opportunities to convey notice and consent are understandable and
                accurate.
                ---------------------------------------------------------------------------
                 \89\ https://www.policygenius.com/blog/health-insurance-literacy-survey-2019/; https://www.cmu.edu/dietrich/sds/docs/loewenstein/ConsumerMisUnderstandHealthIns.pdf.
                ---------------------------------------------------------------------------
                iv. Exceptions to the Availability of Notice and Consent
                 The notice and consent exception is not applicable with respect to
                some non-emergency items or services.\90\ Instead, the prohibition on
                balance billing and the in-network cost-sharing requirements, as
                described in these interim final rules, always apply with respect to
                those items or services. In addition, the exception for notice and
                consent is not applicable with respect to emergency services, except
                for post-stabilization services, under certain conditions.
                ---------------------------------------------------------------------------
                 \90\ 45 CFR 149.420(b) applies in cases of non-emergency
                services furnished by a nonparticipating provider at a participating
                facility and not in cases of emergency services. Additionally, 45
                CFR 149.410(c) specifies that the notice and consent exception for
                post-stabilization services does not apply to items or services
                furnished as a result of unforeseen, urgent medical needs that arise
                at the time a post-stabilization service is furnished for which the
                nonparticipating provider or nonparticipating emergency facility
                already satisfied the notice and consent criteria.
                ---------------------------------------------------------------------------
                 First, as specified in section 2799B-2(b) of the PHS Act, with
                respect to non-
                [[Page 36911]]
                emergency services, the notice and consent exception does not apply to
                ancillary services, which include items and services related to
                emergency medicine, anesthesiology, pathology, radiology, and
                neonatology, whether provided by a physician or non-physician
                practitioner; items and services provided by assistant surgeons,
                hospitalists, and intensivists; diagnostic services, including
                radiology and laboratory services; and items and services provided by a
                nonparticipating provider, only if there is no participating provider
                who can furnish such item or service at such facility.
                 Additionally, as specified in section 2799B-2(c) of the PHS Act,
                the notice and consent exception does not apply to items or services
                furnished as a result of unforeseen, urgent medical needs that arise at
                the time an item or service is furnished for which a nonparticipating
                provider satisfied the notice and consent criteria. For example, even
                if an individual has consented to waive balance billing and in-network
                cost-sharing protections with respect to items and services provided by
                certain nonparticipating providers related to a knee surgery, that
                individual has not consented, nor are providers permitted to seek
                consent under the statute and these interim final rules, to waive those
                protections with respect to unforeseen, urgent medical needs that arise
                during the knee surgery. Because individuals lack the requisite
                information to provide informed consent to waive balance billing and
                cost-sharing protections with respect to unforeseen, urgent medical
                needs, HHS has determined that the rationale for the statutory
                exception for notice and consent to not extend to unforeseen, urgent
                medical needs with respect to non-emergency services also applies to
                unforeseen, urgent post-stabilization services. Therefore, these
                interim final rules provide that any notice provided and consent
                obtained with regard to the furnishing of certain items or services
                does not extend to additional items or services furnished in response
                to unforeseen, urgent medical needs either in the context of a
                nonparticipating provider in a participating facility, or of post-
                stabilization services.
                 The statute authorizes HHS to expand the definition of ancillary
                services to include items and services provided by other types of
                providers. HHS seeks comment on other ancillary services that should be
                considered to be made ineligible for the notice and consent exception.
                In particular, HHS is interested in comments on whether there are other
                ancillary services for which individuals are likely to have little
                control over the particular provider who furnishes items or services.
                HHS is of the view that it is with respect to these types of providers
                that notice and consent procedures are least appropriate. HHS is also
                interested in comments regarding the types of ancillary services for
                which surprise bills are most common, and whether they should be added
                to the definition of ancillary services that are not subject to the
                notice and consent exception. Finally, HHS seeks comment on what
                criteria HHS should use in determining whether other ancillary services
                should be added to the definition.
                 Furthermore, the statute authorizes HHS to specify a list of
                advanced diagnostic laboratory tests that would not be considered
                ancillary services under this definition. Any such advanced diagnostic
                laboratory tests would still be subject to the surprise billing
                protections described in these interim final rules, but the notice and
                consent exemption process would also be available for these tests. HHS
                seeks comment on what criteria HHS should consider in determining
                whether an advanced diagnostic laboratory test should be excepted from
                the definition of ancillary services, and on any specific advanced
                diagnostic laboratory tests that should be considered to be made
                eligible for the notice and consent exception.
                v. Retention of Certain Documents
                 Under Section 2799B-2(e) of the PHS Act and these interim final
                rules, nonparticipating emergency facilities, participating health care
                facilities, and nonparticipating providers are required to retain
                written notice and consent documents for at least a 7-year period after
                the date on which the item or service in question was furnished.
                Specifically, when a nonparticipating emergency facility obtains a
                signed consent from a participant, beneficiary, or enrollee, or such
                individual's authorized representative, for an item or service
                furnished to the individual by the facility or any nonparticipating
                provider at such facility, the facility must retain the written notice
                and consent for the 7-year period. Similarly, when a participating
                health care facility obtains a signed consent from a participant,
                beneficiary, or enrollee, or such individual's authorized
                representative, for an item or service furnished to the individual by a
                nonparticipating provider at such facility, the facility must retain
                the written notice and consent for a 7-year period. If a
                nonparticipating provider obtains a signed consent from a participant,
                beneficiary, or enrollee, or such individual's authorized
                representative, where the facility does not otherwise obtain the
                consent on behalf of the provider, the provider may either coordinate
                with the facility so that the facility retains the written notice and
                consent for a 7-year period, or the provider must retain the written
                notice and consent for a 7-year period. HHS interprets the retention
                requirement to apply to providers as well as facilities, in order to
                ensure that all notice and consent documents are appropriately
                retained, regardless of how they are obtained.
                vi. Requirements To Notify the Plan or Issuer
                 For each item or service furnished by a nonparticipating provider
                or nonparticipating emergency facility, the provider (or participating
                facility on behalf of the nonparticipating provider) or
                nonparticipating emergency facility, as applicable, must timely notify
                the plan or issuer as to whether balance billing and in-network cost
                sharing protections apply to the item or service, and provide to the
                plan or issuer a signed copy of any signed written notice and consent
                documents. With respect to non-emergency services described in 45 CFR
                149.410(a), the nonparticipating provider (or the participating
                facility on behalf of the provider) must timely notify the plan or
                issuer that the item or service was furnished during a visit at a
                participating health care facility. With respect to post-stabilization
                services, the nonparticipating provider or nonparticipating emergency
                facility must notify the plan or issuer as to whether all the
                conditions described in 45 CFR 149.410(b) are met with respect to each
                of the items and services for which the bill is submitted. With respect
                to non-emergency services only, in instances where the nonparticipating
                provider bills the participant, beneficiary, or enrollee directly
                (where permitted under these interim final rules), the provider (or
                participating health care facility on behalf of the provider) may
                satisfy the requirement to timely notify the plan or issuer by
                including the notification with the bill to the individual.
                 In interpreting the statutory requirements, HHS recognizes that it
                is critical that a group health plan or health insurance issuer have
                knowledge of whether the balance billing and in-network cost-sharing
                requirements apply, including whether an item or service is furnished
                during a visit at a participating health care facility and if any
                notice was provided and consent given what items and services were
                consented to, where such items and
                [[Page 36912]]
                services would otherwise be subject to the balance billing protections.
                This information is crucial for the plan or issuer to be able to
                appropriately assign cost sharing and adjudicate the claim in
                compliance with the No Surprises Act. These interim final rules require
                the provider or facility to notify the plan or issuer so that the plan
                or issuer is aware when the balance billing and in-network cost sharing
                protections apply and can process the claim appropriately.\91\
                ---------------------------------------------------------------------------
                 \91\ The Departments note that whether a provider or facility
                provides such a notification to the plan or issuer and whether a
                plan or issuer processes a claim as if notice and consent were
                obtained based on a provider's notification is not determinative of
                whether the balance billing protections apply. A participant,
                beneficiary, or enrollee who is balance billed or whose cost-sharing
                responsibility is calculated at out-of-network rates would still be
                able to contend that they did not receive sufficient notice or did
                not provide consent, and challenge the provider or facility's right
                to balance bill them, as well as and the plan or issuer's handling
                of the claim.
                ---------------------------------------------------------------------------
                 HHS seeks comment on whether additional rulemaking would be helpful
                regarding the process and timing for such notification, including the
                definition of `timely,' and what processes for conveying the
                notification would be most efficient, including existing processes that
                could be leveraged to convey the information. HHS is particularly
                interested in comments regarding the requirement that providers or
                facilities provide to the plan or issuer a copy of the signed written
                notice and consent document, including comments on barriers and burdens
                associated with such requirement, and recommendations on how best to
                ensure plans and issuers have information regarding the notice and
                consent documents without imposing undue burden on providers and
                facilities.
                3. Provider and Facility Disclosure Requirements Regarding Patient
                Protections Against Balance Billing
                 Section 2799B-3 of the PHS Act, added by the No Surprises Act,
                requires providers and facilities to provide disclosures regarding
                patient protections against balance billing. Among other things, the
                statute requires health care providers and facilities (including an
                emergency department of a hospital or independent freestanding
                emergency department) to make publicly available, post on a public
                website of the provider or facility (if applicable), and provide to
                participants, beneficiaries, and enrollees a one-page notice about the
                balance billing requirements and prohibitions that apply to the
                provider or facility under sections 2799B-1 and 2799B-2 of the PHS Act.
                The notice must include information about any applicable state
                requirements, and about how to contact appropriate state and federal
                agencies if the individual believes the provider or facility has
                violated the balance billing rules. These interim final rules codify
                the statutory requirements and information that these disclosures must
                include. In addition, as stated previously, under section 9820(c) of
                the Code, section 720(c) of ERISA, and section 2799A-5(c) of the PHS
                Act, plans and issuers must provide information in plain language on
                the prohibition against balance billing and information on contacting
                appropriate state and federal agencies in the case that an individual
                believes that such a provider or facility has violated the prohibition
                against balance billing. These disclosure requirements are applicable
                for plan years beginning on or after January 1, 2022. To reduce burden
                and facilitate compliance with these disclosure requirements, the
                Departments are concurrently issuing a model disclosure notice that
                health care providers, facilities, group health plans, and health
                insurance issuers may, but are not required to, use to satisfy the
                disclosure requirements regarding the balance billing protections. The
                Departments will consider use of the model notice in accordance with
                the accompanying instructions to be good faith compliance with the
                disclosure requirements of section 9820(c) of the Code, section 720(c)
                of ERISA, and section 2799A-5(c) of the PHS Act, if all other
                applicable requirements are met. The Departments may address these
                requirements in more detail in future guidance or rulemaking. Until
                such guidance or rulemaking implementing the requirements under section
                9820(c) of the Code, section 720(c) of ERISA, and section 2799A-5(c) of
                the PHS Act becomes effective and applicable, plans and issuers should
                exercise good-faith compliance with those statutory provisions.
                 These disclosures are critical to helping raise awareness and
                enhance the public's understanding of state and federal balance billing
                protections. The purpose of these disclosures is to empower individuals
                to better understand the balance billing protections afforded under
                applicable state and federal law. In addition, these disclosures are
                important in ensuring individuals are able to identify violations of
                these interim final rules and related state law requirements and, if
                necessary, file complaints against providers and facilities. These
                disclosures further the efforts to help achieve the goals of the No
                Surprises Act and ensure that individuals are aware of their rights and
                the options available to them. These interim final rules codify the
                provider and facility disclosure requirements at 45 CFR 149.430. These
                requirements apply to health care providers and health care facilities
                (including independent freestanding emergency departments). These
                interim final rules outline requirements regarding the content of the
                one-page disclosure, methods for disclosure, timing of disclosure to
                individuals, exceptions to the requirements, and a special rule to
                prevent unnecessary duplication with respect to providers. These
                disclosure requirements do not apply to providers of air ambulance
                services, as section 2799B-3 of the PHS Act requires providers and
                facilities to disclose information regarding the requirements and
                prohibitions applicable to the provider or facility under sections
                2799B-1 of the PHS Act (relating to balance billing for emergency
                services) and 2799B-2 of the PHS Act (relating to balance billing for
                non-emergency services furnished by nonparticipating providers at
                certain participating facilities), but not under section 2799B-5 of the
                PHS Act (relating to balance billing for air ambulance services).
                Although this provision does not apply to providers of air ambulance
                services, as the definition of health care providers in 45 CFR 149.30
                excludes providers of air ambulance services, HHS encourages providers
                of air ambulance services to make available clear and understandable
                information about the requirements and prohibitions on balance billing
                for air ambulance services.
                i. Content of Disclosure
                 The statute and these interim final rules require that the
                disclosure must include a clear and understandable statement that
                explains the requirements and prohibitions applicable to the provider
                or facility under sections 2799B-1 and 2799B-2 of the PHS Act and their
                implementing regulations, relating to prohibitions on balance billing
                in cases of emergency services and non-emergency services performed by
                a nonparticipating provider at certain participating facilities as
                described earlier in this preamble.
                 In addition, the disclosure must include clear and understandable
                language that explains any applicable state law requirements regarding
                the amounts such provider or facility may charge a participant,
                beneficiary, or enrollee after receiving payment, if any,
                [[Page 36913]]
                from a plan or coverage (with which the provider or facility does not
                have a contractual relationship) and any applicable cost-sharing
                payment from such participant, beneficiary, or enrollee.
                 HHS recognizes that there may be some state laws that are more
                protective of consumers than sections 2799B-1 and 2799B-2 of the PHS
                Act and their implementing regulations. For example, a state law might
                prohibit an individual from providing consent to be balance billed
                under more circumstances than those in which balance billing are
                prohibited under those sections and their implementing regulations. If
                the more protective state law causes certain provisions of sections
                2799B-1 and 2799B-2 of the PHS Act and their implementing regulations
                to be inapplicable to the provider or facility, the provider or
                facility is not required to include language containing information on
                those inapplicable provisions in the disclosures regarding the federal
                requirements and prohibitions, to the extent permitted under state law.
                However, the provider or facility would continue to be required to
                include information in the disclosures about any provisions in sections
                2799B-1 and 2799B-2 of the PHS Act and their implementing regulations
                that remain applicable to the provider or facility.
                 Last, the statute and these interim final rules require that the
                disclosure must include clear and understandable language providing
                contact information for the appropriate state and federal agencies that
                an individual may contact if the individual believes the provider or
                facility has violated a requirement described in the notice. If only
                one federal or state agency has oversight with respect to providers or
                facilities in the state, the disclosure may include contact information
                for only that agency.
                 In an effort to reduce the burden on health care providers and
                facilities, HHS has developed a model notice that health care providers
                and facilities may adopt, but are not required to use. HHS would
                consider a provider or facility that uses the HHS-developed model
                notice to be compliant with these federal disclosure rules with respect
                to the information regarding sections 2799B-1 and 2799B-2 of the PHS
                Act and their implementing regulations. HHS encourages states to
                develop model language to assist health care providers and facilities
                in fulfilling the disclosure requirements related to applicable state
                law requirements and contact information. If a state develops model
                language that is consistent with section 2799B-3 of the PHS Act, HHS
                will consider a provider or facility that makes appropriate use of the
                state-developed model language to be compliant with the federal
                requirement to include information about state law protections.
                 To ensure clear and understandable language for the required
                information, HHS encourages health care providers and facilities to
                utilize plain language in the disclosure statements and to consider
                user testing in the development of such notices.\92\ Providers and
                facilities must comply with applicable state or federal language access
                standards in providing the disclosures.\93\ Communication and language
                barriers are associated with decreased quality of care and poorer
                health outcomes.\94\ Studies have shown the benefits associated with
                the use of language services in clinics and hospitals include (1)
                increased quality of care, (2) improved patient safety outcomes, and
                (3) lower utilization of costly medical procedures. The presence of a
                language barrier is associated with higher rates of costly resource
                utilizations for diagnostic testing, increased emergency department
                visits, decreased use of preventive services, higher rates of
                hospitalization, and higher rates of adverse health outcomes.\95\ HHS
                believes it is imperative that health care providers and facilities
                provide the required disclosure information in a clear and
                understandable manner to help achieve the goal of the No Surprises Act
                and ensure that individuals are aware of their rights related to
                protections against balance billing.
                ---------------------------------------------------------------------------
                 \92\ See https://methods.18f.gov/ for information on user
                testing.
                 \93\ See section IV.2.iii of this preamble for discussion of
                select federal access standards.
                 \94\ https://www.cms.gov/About-CMS/Agency-Information/OMH/Downloads/Language-Access-Plan-508.pdf.
                 \95\ See Dewalt DA, Berkman ND, Sheridan S, Lohr KN, Pignone MP.
                Literacy and health outcomes: a systematic review of the literature.
                J Gen Intern Med. 2004;19(12):1228-1239. doi:10.1111/j.1525-
                1497.2004.40153.x; Scott TL, Gazmararian JA, Williams MV, Baker DW.
                Health literacy and preventive health care use among Medicare
                enrollees in a managed care organization. Med Care. 2002;40:395-404;
                Baker DW, Parker RM, Williams MV, Clark WS. Health literacy and the
                risk of hospital admission. J Gen Intern Med. 1998;13:791-8; Neira
                L. The importance of addressing language barriers in the US health
                system. Duke Center for Personalized Health Care (July 17, 2018),
                available at: https://dukepersonalizedhealth.org/2018/07/the-importance-of-addressing-language-barriers-in-the-us-health-system/.
                ---------------------------------------------------------------------------
                 In addition, HHS reminds health care providers and facilities that
                these notices must comply with applicable federal civil rights laws,
                including that providers and facilities must take reasonable steps to
                provide meaningful access for individuals with limited English
                proficiency and appropriate steps to ensure effective communication
                with individuals with disabilities, including accessibility of
                information and communication technology.
                 HHS seeks comment on the content of the required disclosures.
                Consistent with Executive Order 13985 and civil rights protections
                cited in these interim final rules, HHS particularly seeks comments
                from minority and underserved communities, including from those with
                limited English proficiency, those who prefer information in alternate
                and accessible formats, those who are otherwise adversely affected by
                persistent poverty and inequality, as well as from stakeholders who
                serve these communities, on what additional barriers may exist so as to
                ensure individuals can read, understand, and consider disclosure
                information and on what policies HHS may consider for addressing and
                removing these barriers.
                ii. Methods of Disclosure
                 The statute and these interim final rules require that each health
                care provider and facility must make the required disclosure publicly
                available, and (if applicable) post it on a public website of such
                provider or facility. In addition, providers and facilities must
                provide a one-page notice to individuals who are participants,
                beneficiaries, or enrollees of a group health plan or individual health
                insurance coverage offered by a health insurance issuer.
                 To satisfy the requirement to post the disclosure on a public
                website, the disclosure or a link to such disclosure must be searchable
                on the provider's or facility's public website. HHS is of the view that
                the required disclosure information would not be publicly available
                unless displayed in a manner that is easily accessible, without
                barriers, and that ensures that the information is accessible to the
                general public, including that it is findable through public search
                engines. For example, HHS is of the view that a public website must be
                accessible free of charge, without having to establish a user account,
                password, or other credentials, accept any terms or conditions, and
                without having to submit any personal identifying information such as a
                name or email address. HHS seeks comment on whether additional
                regulatory standards are needed regarding what constitutes disclosure
                on a provider's or facility's public website to ensure the information
                is accessible to the public.
                [[Page 36914]]
                 These interim final rules provide that a health care provider or
                health care facility that does not have its own website is not required
                to make a disclosure on a public website. HHS anticipates that most
                facilities subject to the requirements in sections 2799B-1 and 2799B-2
                of the PHS Act would generally have a website, but recognizes that
                providers who furnish services at such facilities may not have their
                own website.
                 To satisfy the required disclosure to the public, providers and
                facilities must display the required disclosure information on a sign
                posted prominently at the location of the health care provider or
                health care facility. HHS would consider a sign to be posted
                prominently, if the sign were posted in a central location, such as
                where individuals schedule care, check-in for appointments, or pay
                bills. Such locations would allow individuals to be aware of the
                protections available before or at the time of service or payment. HHS
                is of the view that ensuring the individual is aware of the surprise
                billing protections is integral to implementation of these
                requirements. HHS recognizes that some providers may not have publicly
                accessible locations and has concluded that requiring a sign to be
                posted prominently at a non-publicly accessible location would not
                further the purpose of providing a disclosure. Therefore, providers
                without a publicly accessible location are not required to make the
                disclosure under 45 CFR 149.430(c)(2).
                 Lastly, the statute and these interim final rules require that
                health care providers and facilities must provide the required
                disclosure information in a one-page notice to individuals who are
                participants, beneficiaries, or enrollees of a group health plan or
                group or individual health insurance coverage offered by a health
                insurance issuer. The notice must be provided in-person or through mail
                or email, as selected by the participant, beneficiary, or enrollee. As
                outlined in the statute, the required disclosure to individuals must be
                limited to one page. HHS interprets the statute such that the
                disclosure notice may be one double-sided page. These interim final
                rules specify that the one-page disclosure must not include print
                smaller than 12-point font. These specifications are important to
                ensure that the one-page document is both designed in a form and
                presented in a manner that is readable by the individual or their
                representative and that it contains sufficient content to meet the
                requirements of these interim final rules.
                 HHS seeks comment on these disclosure methods, including whether
                additional methods of providing information should be required or
                permitted. In particular, HHS is interested in comments regarding
                whether posting of the disclosure information could be in a location
                other than a sign posted prominently at the location of the provider or
                facility. In addition, HHS seeks comment on ways to ensure that the
                required disclosure information posted on a public website is
                accessible to individuals.
                iii. Timing of Disclosure to Individuals
                 These interim final rules generally require a health care provider
                or health care facility to provide the notice to participants,
                beneficiaries, or enrollees no later than the date and time on which
                the provider or facility requests payment from the individual
                (including requests for copayment made at the time of a visit to the
                provider or facility). In cases where the facility or provider does not
                request payment from the individual, the notice must be provided no
                later than the date on which the provider or facility submits a claim
                for payment to the plan or issuer.
                 HHS is of the view that the notice will be most effective in
                helping individuals understand their rights and protections under
                federal and state balance billing laws and protecting individuals from
                being improperly billed, if individuals receive the notice in
                accordance with this timing requirement. The requirement will ensure
                the disclosures are meaningful and that individuals are aware of their
                rights before or at the time of payment, which is likely to help
                individuals to avoid paying bills that are prohibited under state or
                federal balance billing rules. However, these interim final rules offer
                providers and facilities flexibility regarding when the disclosure must
                be provided to individuals. Providers and facilities may provide the
                required disclosures to individuals earlier. For example, they could
                provide the notice when an individual schedules an appointment, or when
                other standard notice disclosures (such as the Notice of Privacy
                Practices for Protected Health Information \96\) are shared with
                individuals.
                ---------------------------------------------------------------------------
                 \96\ For requirements regarding when health care providers are
                required to provide the Notice of Privacy Practices, see 45 CFR
                164.520(c).
                ---------------------------------------------------------------------------
                 In developing these interim final rules, HHS considered allowing
                providers or facilities to provide the disclosure annually or only at
                the time a patient schedules a service, but wanted to ensure the timing
                of the disclosure was relevant to when the individual may experience a
                violation of the surprise billing protections. HHS encourages providers
                and facilities to provide individuals with the notice at a time that
                will maximize the notice's effectiveness.
                 HHS seeks comment on this timing requirement, and whether another
                timing requirement would be more appropriate.
                iv. Exceptions
                 Although section 2799B-3 of the PHS Act could be interpreted to
                apply broadly to all health care providers and facilities, these
                interim final rules include two exceptions to the general requirement
                to provide disclosures regarding balance billing protections. First,
                health care providers are not required to make the disclosures required
                under this section if they do not furnish items or services at a health
                care facility, or in connection with visits at health care facilities.
                Second, health care providers are required to provide the required
                disclosure only to individuals to whom they furnish items or services,
                and then only if such items or services are furnished at a health care
                facility, or in connection with a visit at a health care facility. HHS
                further notes that, under section 2799B-3 of the PHS Act, disclosure is
                required only to individuals who are participants, beneficiaries, or
                enrollees of a group health plan or group or individual health
                insurance coverage offered by a health insurance issuer. However, as
                specified in 5 U.S.C. 8902(p), section 2799B-3 of the PHS Act applies
                to a health care provider and facility with respect to a covered
                individual in a FEHB plan, as well. The disclosure requirement is not
                required with respect to other individuals seeking care from a provider
                or facility.
                 While the statute does not explicitly provide for these exceptions,
                HHS is of the view that these exceptions serve two important purposes.
                First, they seek to avoid unnecessary confusion among individuals who
                otherwise might receive the disclosure under circumstances in which the
                balance billing protections would never apply. For instance, providing
                the disclosure of balance billing protections in a primary care
                provider's office could lead individuals to incorrectly assume balance
                billing protections exist where they do not. Second, by ensuring that
                the disclosures are targeted narrowly to relevant individuals, the
                exceptions aim to implement the statutory requirement without creating
                additional undue burden on providers and facilities.
                 HHS is of the view that these exceptions are consistent with
                balance
                [[Page 36915]]
                billing requirements elsewhere in these interim final rules, related to
                emergency services or non-emergency services furnished by a
                nonparticipating provider at a participating facility. Furthermore, HHS
                is of the view that these exceptions do not lessen the positive impact
                of the disclosure requirement, as health care providers and facilities
                are still required to make the disclosures where balance billing is
                most likely to occur, which will help to ensure individuals are aware
                of their rights relating to consumer protections against balance
                billing.
                 HHS seeks comment on these exceptions and whether there are other
                scenarios that should be considered.
                v. Special Rule To Prevent Unnecessary Duplication With Respect to
                Providers
                 HHS realizes there may be some instances where an individual may
                receive two disclosure notices--one from a provider furnishing items or
                services at a health care facility, and the other from the health care
                facility itself. These interim final rules include a special rule to
                streamline the provision of the required disclosure to the public and
                one-page notice to individuals and avoid unnecessary duplication of the
                disclosures with respect to providers furnishing care at a health care
                facility. This special rule does not apply with respect to the
                requirement that each health care provider and facility post the
                required disclosure on a public website of such provider or facility.
                While section 2799B-3 of the PHS Act does not explicitly provide for a
                special rule to prevent unnecessary duplication with respect to
                providers, HHS is of the view that this special rule serves an
                important purpose in implementing these requirements while reducing
                unnecessary burden and effort for providers. Furthermore, HHS is of the
                view that this special rule will also help reduce potential consumer
                confusion by allowing individuals to receive only one disclosure notice
                when receiving services from a provider furnishing items or services at
                a health care facility, both of which are subject to the disclosure
                requirement.
                 The special rule provides that to the extent a provider furnishes
                an item or service covered under the plan or coverage at a health care
                facility (including an emergency department of a hospital or
                independent freestanding emergency department), the provider satisfies
                the disclosure requirements if the facility agrees to provide the
                information, in the required form and manner, pursuant to a written
                agreement. In such instance, the disclosure must include information
                about the balance billing requirements and prohibitions applicable to
                both the facility and the provider. If a provider and facility have a
                written agreement under which the facility agrees to provide the
                information required under these interim final rules, and the facility
                fails to provide full or timely disclosure information, then the
                facility, but not the provider, would violate the provider disclosure
                requirements regarding balance billing protections. HHS is of the view
                that this will remove unnecessary burden and effort for the providers.
                HHS clarifies that a ``written agreement'' may be an existing contract
                between the provider and facility to furnish care at the facility, if
                amended to provide for this special rule. Alternatively, a provider and
                facility may enter into a new written agreement specifically outlining
                the disclosure requirements regarding balance billing protections.
                 Providers that enter into these arrangements with facilities are
                encouraged to monitor the facility's adherence to these requirements.
                In addition, if a provider has knowledge that the required disclosure
                information is not being provided in a manner specified in these
                interim final rules, HHS encourages the provider to work with the
                facility to correct the noncompliance as soon as practicable or notify
                the applicable state authority or HHS, in states where HHS is enforcing
                this requirement.\97\ HHS may provide additional guidance if HHS
                becomes aware of situations where participants, beneficiaries, and
                enrollees are not being provided the required disclosure information in
                accordance with these interim final rules.
                ---------------------------------------------------------------------------
                 \97\ Pursuant to section 2799B-4 of the PHS Act, states have
                authority to enforce the requirements of Part E of title XXVII of
                the PHS Act against a provider or health care facility (including a
                provider of air ambulance services), and HHS must enforce if a state
                has failed to substantially enforce the requirements. HHS intends to
                issue rulemaking in the future to implement section 2799B-4 of the
                PHS Act.
                ---------------------------------------------------------------------------
                 HHS recognizes that providers and facilities frequently bill
                separately for items and services furnished by the provider and the
                facility, and considered whether to make the special rule inapplicable
                in those instances. However, HHS concluded that applying the special
                rule is appropriate in these situations, since the disclosures are not
                required to be included with the bill itself. Although these interim
                final rules provide some flexibility around the timing of the notice,
                HHS anticipates that the disclosure to the individual would generally
                be provided at the point of care. Thus, requiring the provider and
                facility to separately provide notices whenever they bill separately
                could result in the individual receiving multiple notices for the same
                visit. Duplicative paperwork could overwhelm or confuse the receiving
                individual, which could detract from the primary purpose of clarifying
                and making known the protections that may apply to the individual. In
                addition, HHS is of the view that requiring a provider to separately
                post a disclosure within a facility is of limited additional benefit
                and may present compliance challenges for providers who lack designated
                space within a facility. Therefore, the special rule applies regardless
                of whether the provider and facility bill jointly or separately.
                 Furthermore, since the special rule does not apply with respect to
                the requirement that each health care provider and facility make the
                required disclosure available on the public website of the provider or
                facility, HHS is of the view that this special rule works to achieve
                the goals of preventing unnecessary duplication for providers and
                facilities, while encouraging safeguards to ensure that individuals
                receive the required disclosure information and are aware of their
                rights. HHS is of the view that this special rule does not lessen the
                positive impact of the disclosure requirement. This special rule will
                continue to help to ensure individuals are aware of their rights
                relating to patient protections against surprise billing.
                 HHS seeks comment on this special rule and whether there are other
                circumstances that may warrant a special rule to prevent unnecessary
                duplication. In addition, HHS seeks comment on whether providers should
                be required, rather than encouraged, to monitor and report whether a
                facility is not complying with the requirement outlined in these
                interim final rules.
                4. Surprise Billing Complaints Regarding Health Care Providers,
                Facilities, and Providers of Air Ambulance Services
                 The No Surprises Act adds section 2799B-4(b)(3) of the PHS Act,
                which directs HHS to establish a process to receive consumer complaints
                regarding violations by health care providers, facilities, and
                providers of air ambulance services of balance billing requirements
                under sections 2799B-1, 2799B-2, 2799B-3, and 2799B-5 of the PHS Act
                and to respond to such complaints within 60 days. Therefore, the
                interim final rules establish an HHS-only complaints process for health
                care providers, facilities and providers of air ambulance services that
                parallels the
                [[Page 36916]]
                process that the Departments are establishing through these interim
                final rules for plans and issuers. A more fulsome discussion of the
                complaints process for providers can be found in section III.B.4 of
                this preamble. HHS seeks comment on the complaints process for health
                care providers, facilities, and providers of air ambulance services
                described in these interim final rules.
                5. Catastrophic Plans
                 As discussed earlier in this preamble, where the surprise billing
                protections apply, and the out-of-network rate exceeds the amount upon
                which cost sharing is based (which for emergency services provide by a
                nonparticipating emergency facility and for non-emergency services
                provided by a nonparticipating provider at a participating health care
                facility is the recognized amount, and for services provided by a
                nonparticipating provider of air ambulance services is the lesser of
                the billed amount or the QPA), a group health plan or health insurance
                issuer offering group or individual health insurance coverage must pay
                the provider or facility the difference between the out-of-network rate
                and the cost-sharing amount, even in cases where an individual has not
                satisfied their deductible (in which case the cost-sharing amount is
                the recognized amount, or the lesser of the billed amount or the QPA,
                as applicable). Catastrophic plans generally cannot provide benefits
                for any plan year until the annual limitation on cost sharing in
                section 1302(c)(1) of ACA is reached, other than coverage of preventive
                services under section 2713 of the PHS Act and at least three primary
                care visits. A catastrophic plan cannot comply with the new balance
                billing protections, specifically the obligation to make a payment to a
                provider or facility prior to the enrollee meeting the annual
                limitation on cost sharing, while satisfying the definition of a
                catastrophic plan at section 1302(e) of ACA. Because the No Surprises
                Act does not contain language eliminating catastrophic plans or
                exempting catastrophic plans from the law's requirements, HHS
                interprets the statute as permitting catastrophic plans to make
                payments required by sections 2799A-1 or 2799A-2 of the PHS Act without
                losing their status as catastrophic plans. HHS is, therefore, amending
                45 CFR 156.155 in these interim final rules to specify that a
                catastrophic plan must provide benefits as required under sections
                2799A-1 and 2799A-2 of the PHS Act and their implementing regulations,
                or any applicable state law providing similar surprise billing
                protections to individuals. Additionally, a health plan will not fail
                to be treated as a catastrophic plan because the plan provides benefits
                prior to the annual limitation on cost sharing in section 1302(c)(1) of
                the ACA, as required under sections 2799A-1 and 2799A-2 of the PHS Act
                or any applicable state law providing similar protections to
                individuals.
                V. Overview of Interim Final Rules--Office of Personnel Management
                A. Conforming Changes for FEHB Program
                 The OPM interim final rules, through new 5 CFR 890.114 in subpart
                A, protect FEHB Program covered individuals from surprise medical bills
                for emergency services, air ambulance services furnished by
                nonparticipating providers, and non-emergency services furnished by
                nonparticipating providers at participating health care facilities in
                certain circumstances in the same manner as the Departments' rules
                protect participants, beneficiaries, or enrollees. The Departments'
                interim final rules generally apply with respect to FEHB carriers'
                compliance with the No Surprises Act, except to the extent that
                differences are necessitated for clarification or appropriate
                application in the context of the FEHB Program. In considering
                application of the Departments' interim rules with respect to the FEHB
                Program, it is important to recognize that all FEHB carriers offer
                fully insured health benefits plans in consideration of premium
                payments pursuant to contract terms, and no health benefits plan is
                self-insured by OPM or the Federal government. OPM seeks comment on
                this approach and whether there should be any additional considerations
                in the application of these interim final rules in the context of the
                FEHB Program.
                B. Preemption and OPM Enforcement
                 FEHB contract terms preempt state law with respect to coverage or
                benefits (including payments with respect to benefits) pursuant to 5
                U.S.C. 8902(m)(1). Such preemption renders specified state law
                inapplicable for the purposes of determining recognized amounts and
                out-of-network rates under 26 CFR part 54, 29 CFR part 2590, and 45 CFR
                part 149. However, pursuant to bilateral negotiation of FEHB contract
                terms, OPM and the carrier may agree to apply state law to determine
                the total amount payable, rendering the state law amount, method, or
                process for determining the total amount payable an effective term of
                the Federally-regulated, Federally-enforced contract. Accordingly, in
                this instance, FEHB contract terms will govern the methodology for
                determining recognized amounts and out-of-network rates. In the absence
                of a FEHB contract term incorporating a state law amount, method, or
                process for determining the total amount payable (including an amount
                determined pursuant to an All-Payer Model Agreement under section 1115A
                of the Social Security Act), the lesser of the billed amount or the QPA
                will serve as the recognized amount under the FEHB plan. Likewise, in
                the absence of a FEHB contract term incorporating an applicable state
                IDR process, the federal IDR process will govern the determination of
                out-of-network rates in cases of failed open negotiations.
                 Example A: A community-rated FEHB plan covers a specific non-
                emergency service that is provided to a covered individual in State A
                by a nonparticipating provider in a participating health care facility.
                Both the provider and the facility are licensed in State A. State A has
                a law that prohibits balance billing for non-emergency services
                provided to individuals by nonparticipating providers in a
                participating health care facility, and provides for a method for
                determining the cost-sharing amount and total amount payable. The law
                applies to health insurance issuers and providers licensed in State A
                and applies to the type of service provided. OPM and the FEHB carrier,
                through the annual contract negotiation cycle, have elected to utilize
                State A's law, and the FEHB health benefits plan contains a term
                expressly incorporating the State A law prohibiting balance billing. In
                this Example, the FEHB contract terms apply the state law to determine
                the recognized amount and the out-of-network rate.
                 Example B: Same facts as Example A, except that the FEHB contract
                terms do not incorporate or expressly refer to the balance billing law
                of State A. In this Example, State A's law prohibiting balance billing
                would be preempted by the terms of the FEHB contract. The lesser of the
                billed amount or QPA would apply to determine the recognized amount.
                The out-of-network rate would be determined through open negotiation
                between the nonparticipating provider and the FEHB carrier, or in the
                case of failed negotiations, an amount determined under the federal IDR
                process.
                 Enforcement of these interim final rules with respect to FEHB
                carriers will generally be governed by OPM authorities set forth herein
                and 5 U.S.C.
                [[Page 36917]]
                8901 et seq., 5 CFR part 890, 48 CFR chapter 16, or the carrier's FEHB
                contract. Any differences in terminology or other clarification will be
                set forth in the applicable FEHB contract.
                C. Definitions
                 The No Surprises Act and these interim final rules include defined
                terms that are specific to the law's requirements and implementation.
                Definitions of key terms with respect to OPM's enforcement of 5 U.S.C.
                8902(p) generally align with the Departments' regulations, with certain
                exceptions. For compliance with these provisions, the terms ``group
                health plan or plan,'' ``health insurance issuer or issuer,'' and
                ``participant, beneficiary, or enrollee'' are respectively replaced
                with the terms ``health benefits plan,'' ``carrier,'' and ``enrollee or
                covered individual.''
                D. Complaints
                 Complaints related to the provisions under Part D of title XXVII of
                the PHS Act with respect to carriers and FEHB plans will generally be
                resolved in accordance with the Departments' interim final rules. OPM
                will coordinate with the Departments to ensure that complaints
                appropriate for OPM resolution under the FEHB Program statute,
                regulations or contractual authorities are referred to OPM.
                E. Jurisdiction of Courts
                 Under 5 U.S.C. 8912, the district courts of the United States have
                original jurisdiction, concurrent with the United States Court of
                Federal Claims, of a civil action or claim against the United States
                founded on FEHBA. Pursuant to new paragraph (e) in 5 CFR 890.107, in
                the event of litigation under these interim final rules, a suit for
                equitable relief founded on 5 U.S.C. chapter 89 that is based on 5
                U.S.C. 8902(p) and is governed by 5 CFR part 890 must be brought
                against OPM by December 31 of the 3rd year after the year in which
                disputed services were rendered. OPM seeks comment on amendments to its
                regulation on court review.
                F. Applicability
                 OPM seeks comment on the appropriate manner of conforming
                compliance with sections 9816, 9817, and 9822 of the Code; sections
                716, 717, and 722 of ERISA; and sections 2799A-1, 2799A-2, and 2799A-7
                of the PHS Act for application to FEHB carriers, including the
                appropriateness and usability of the definitions and any additional
                changes to the Departments' regulatory provisions that must be
                conformed for appropriate implementation in the FEHB Program.
                 For purposes of 5 U.S.C. 8902(p), the HHS interim final rules apply
                to health care providers, facilities, and providers of air ambulance
                services with respect to covered individuals in a FEHB plan in the same
                manner as they apply with respect to participants, beneficiaries, and
                enrollees in a group health plan or group or individual health
                insurance coverage offered by a health insurance issuer. OPM seeks
                comment on the appropriate manner of conforming compliance with 5
                U.S.C. 8902(p) and sections 2799B-1, 2799B-2, 2799B-3, and 2799B-5 of
                the PHS Act.
                 Consistent with the Departments' approach discussed in section
                III.D. of this preamble, OPM will not apply these interim final rules
                to health benefits plans that are retiree-only plans.
                VI. Waiver of Proposed Rulemaking
                 Section 9833 of the Code, section 734 of ERISA, and section 2792 of
                the PHS Act authorize the Secretaries of the Treasury, Labor, and HHS
                (collectively, the Secretaries), respectively, to promulgate any
                interim final rules that they determine are necessary or appropriate to
                carry out the provisions of chapter 100 of the Code, part 7 of subtitle
                B of title I of ERISA, and title XXVII of the PHS Act.
                 In addition, under section 553(b) of the Administrative Procedure
                Act (APA) (5 U.S.C. 551 et seq.) a general notice of proposed
                rulemaking is not required when an agency finds good cause that notice
                and comment procedures are impracticable, unnecessary, or contrary to
                the public interest and incorporates a statement of the finding and its
                reasons in the rule issued. The Secretaries and OPM Director have
                determined that it would be impracticable and contrary to the public
                interest to delay putting the provisions in these interim final rules
                in place until after a full public notice and comment process has been
                completed.
                 The No Surprises Act was enacted on December 27, 2020, as title I
                of Division BB of the Consolidated Appropriations Act, 2021. The cost-
                sharing and balance billing requirements on plans, issuers, health care
                providers, facilities, and providers of air ambulance services in the
                No Surprises Act apply for plan years (in the individual market, policy
                years) beginning on or after January 1, 2022. Although this effective
                date may have allowed for the regulations, if promulgated with the full
                notice and comment rulemaking process, to be applicable in time for the
                applicability date of the provisions in the No Surprises Act, this
                timeframe would not provide sufficient time for the regulated entities
                to implement the requirements. These interim final rules require plans
                and issuers to make significant changes to how they pay for items and
                services that are subject to the cost-sharing and balance billing
                protections, including implementing claims processing procedures to
                ensure that claims for items and services subject to these protections
                are processed in accordance with the requirements in these interim
                final rules. Group health plans and health insurance issuers offering
                group or individual health insurance coverage will have to account for
                these changes in establishing their premium or contribution rates, and
                in making other changes to the designs of plan or policy benefits. In
                some cases, issuers will need time to secure approval for these changes
                in advance of the plan or policy year in question. The Departments and
                OPM anticipate the plans and issuers will have already taken into
                consideration the statutory provisions in the No Surprises Act as they
                developed plan designs for 2022, and preliminary rates. Issuing these
                rules as interim final rules, rather than as a notice of proposed
                rulemaking, may allow plans and issuers to account for the finalized
                regulations as they finalize rates and plan offerings.
                 The interim final rules place new requirements on facilities,
                health care providers, and providers of air ambulance services
                regarding when they are permitted to balance bill for items and
                services. Such requirements include new requirements related to how
                providers and facilities must bill for items and services furnished on
                an out-of-network basis, requirements related to providing notice and
                obtaining consent regarding balance billing protections in certain
                circumstances, and requirements to disclose information on balance
                billing publicly, on a public website and to participants,
                beneficiaries, and enrollees. Health care providers and facilities
                require time to implement these new requirements to ensure compliance
                by January 1, 2022.
                 These interim final rules contain critical protections for
                participants, beneficiaries, and enrollees against balance billing. For
                individuals who receive balance bills, the costs can be astronomical
                and devastating.\98\ In addition, the recipients of such bills are not
                the only ones who feel their impact. As discussed elsewhere in this
                preamble, providers have previously been able to leverage the ability
                to
                [[Page 36918]]
                balance bill to negotiate higher in-network rates. This leads to higher
                premiums, higher cost sharing for consumers, and increased health
                expenditures.\99\ One study estimated that policies to address surprise
                billing on a federal level could decrease health insurance premiums by
                one to five percent.\100\ Additionally, consumers may delay receiving
                needed medical care, including for emergency medical conditions, over
                concern about surprise medical bills. It is therefore in the public
                interest that individuals receive the protections under the No
                Surprises Act on the date on which those protections go into effect.
                Accordingly, in order to allow plans, health insurance issuers,
                facilities, health care providers, and providers of air ambulance
                services sufficient time to implement these new requirements, these
                rules must be published and available to the public well in advance of
                the effective date of the requirements in the No Surprises Act.
                Allowing time for a full notice and comment process prior to the
                requirements taking effect would not provide sufficient time for these
                entities to comply with the requirements for plan years (in the
                individual market, policy years) beginning on or after January 1, 2022,
                which would risk subjecting the public to prohibited balance bills and
                excess cost sharing. Additionally, plans and issuers need certainty
                regarding the standards of these requirements in order to begin
                implementation, which these interim final rules seek to provide.
                ---------------------------------------------------------------------------
                 \98\ See, Greaney, T.L., Surprise Billing: A Window into the
                U.S. Health Care System, ABA Civil Rights and Social Justice
                Section, Human Rights Magazine (Sept. 8, 2020); Cooper, Z. et al.,
                Surprise! Out-Of-Network Billing For Emergency Care in the United
                States, NBER Working Paper 23623, 20173623 (July 2017, Revised
                January 2018).
                 \99\ See Cooper, Z. et al., Surprise! Out-Of-Network Billing For
                Emergency Care in the United States, NBER Working Paper 23623,
                20173623 (July 2017, Revised January 2018); Duffy, E. et al.,
                ``Policies to Address Surprise Billing Can Affect Health Insurance
                Premiums.'' The American Journal of Managed Care 26.9 (2020): 401-
                404; and Brown E.C.F., et al., The Unfinished Business of Air
                Ambulance Bills, Health Affairs Blog, March 26, 2021. DOI: 10.1377/
                hblog20210323.911379, available at https://www.healthaffairs.org/do/10.1377/hblog20210323.911379/full/.
                 \100\ Trish E. et al., Policies to Address Surprise Billing Can
                Effect Health Insurance Premiums, Am J Manag Care. 2020;26(9):401-
                404. https://doi.org/10.37765/ajmc.2020.88491.
                ---------------------------------------------------------------------------
                 Section 2723 of the PHS Act authorizes states to enforce the
                requirements in Part D of title XXVII of the PHS Act with respect to
                issuers. Section 2799B-4 of the PHS Act authorizes states to enforce
                the requirements in Part E of title XXVII of the PHS Act with respect
                to providers and health care facilities (including a provider of air
                ambulance services). Under both sections, HHS is required to enforce
                such requirements if a state fails to substantially enforce them. In
                order to ensure effective oversight of these new requirements as soon
                as they go into effect, states require time to assess the requirements
                contained in these interim final regulations, and notify HHS if they
                have not enacted legislation to enforce such requirements or they
                otherwise will not be enforcing such requirements. States that opt to
                enforce the requirements may require time to update their regulations
                or statutes and develop processes for enforcing the new requirements.
                Delaying the rules to allow for notice and comment procedures would not
                provide sufficient time for states to assess the new requirements and
                notify HHS of their ability to enforce.
                 In addition, the law requires the Secretaries to issue rulemaking
                by July 1, 2021, regarding the QPA methodology (including defining the
                geographic regions for purposes of the methodology); information plans
                or issuers must share with nonparticipating providers or facilities, as
                applicable, regarding the plan or issuer's determination of the QPA;
                and a process to receive complaints related to the QPA. Allowing time
                for a full notice and comment process prior to July 1, 2021, would not
                have provided sufficient time for the Departments to develop and
                publish these rules by the statutory deadline.
                 For the foregoing reasons, the Departments and OPM have determined
                that it is impracticable and contrary to the public interest to engage
                in full notice and comment rulemaking before putting these interim
                final rules into effect, and that it is in the public interest to
                promulgate interim final rules.
                VII. Economic Impact and Paperwork Burden
                A. Summary
                 These interim final rules implement provisions of the No Surprises
                Act, which Congress enacted as part of the CAA, that protect
                participants, beneficiaries, and enrollees in group health plans and
                group and individual health insurance coverage from surprise medical
                bills when they receive emergency services, non-emergency services from
                nonparticipating providers at certain participating facilities, and air
                ambulance services, under certain circumstances.
                 The Departments and OPM \101\ have examined the effects of these
                interim final rules as required by Executive Order 13563 (76 FR 3821,
                January 21, 2011, Improving Regulation and Regulatory Review);
                Executive Order 12866 (58 FR 51735, October 4, 1993, Regulatory
                Planning and Review); the Regulatory Flexibility Act (September 19,
                1980, Pub. L. 96-354); section 1102(b) of the Social Security Act (42
                U.S.C. 1102(b)); section 202 of the Unfunded Mandates Reform Act of
                1995 (March 22, 1995, Pub. L. 104-4); Executive Order 13132 (64 FR
                43255, August 10, 1999, Federalism); and the Congressional Review Act
                (5 U.S.C. 804(2)).
                ---------------------------------------------------------------------------
                 \101\ All references to the Departments in the Economic Impact
                section of the preamble include OPM. The analysis includes FEHB
                plans.
                ---------------------------------------------------------------------------
                B. Executive Orders 12866 and 13563
                 Executive Order 12866 directs agencies to assess all costs and
                benefits of available regulatory alternatives and, if regulation is
                necessary, to select regulatory approaches that maximize net benefits
                (including potential economic, environmental, public health and safety
                effects, distributive impacts, and equity). Executive Order 13563 is
                supplemental to and reaffirms the principles, structures, and
                definitions governing regulatory review as established in Executive
                Order 12866.
                 Section 3(f) of Executive Order 12866 defines a ``significant
                regulatory action'' as an action that is likely to result in a rule:
                (1) Having an annual effect on the economy of $100 million or more in
                any one year, or adversely and materially affecting a sector of the
                economy, productivity, competition, jobs, the environment, public
                health or safety, or state, local or tribal governments or communities
                (also referred to as ``economically significant''); (2) creating a
                serious inconsistency or otherwise interfering with an action taken or
                planned by another agency; (3) materially altering the budgetary
                impacts of entitlement grants, user fees, or loan programs or the
                rights and obligations of recipients thereof; or (4) raising novel
                legal or policy issues arising out of legal mandates, the President's
                priorities, or the principles set forth in the Executive Order.
                 A regulatory impact analysis must be prepared for major rules with
                economically significant effects (for example, $100 million or more in
                any one year), and a ``significant'' regulatory action is subject to
                review by OMB. The Departments anticipate that this regulatory action
                is likely to have economic impacts of $100 million or more in at least
                1 year, and thus meets the definition of an ``economically significant
                rule'' under Executive Order 12866. Therefore, the Departments have
                provided an assessment of the potential costs, benefits, and transfers
                associated with these interim final rules. In accordance with the
                provisions of Executive Order 12866, these interim final rules were
                reviewed by OMB.
                [[Page 36919]]
                1. Need for Regulatory Action
                 A surprise medical bill is an unexpected bill from a health care
                provider or facility that occurs when a participant, beneficiary, or
                enrollee receives medical services from a provider (including a
                provider of air ambulance services) or facility that, generally
                unbeknownst to the participant, beneficiary, or enrollee, is a
                nonparticipating provider or facility with respect to the individual's
                coverage. Surprise bills usually occur in situations when a patient is
                unable to choose a provider (including a provider of air ambulance
                services) or emergency facility and ensure that they receive care from
                only providers or emergency facilities that are participating for their
                coverage. A recent survey revealed that two-thirds of adults worry
                about being able to afford unexpected medical bills for themselves and
                their families, and 41 percent of adults with health insurance received
                a surprise medical bill in the previous 2 years.\102\ Surprise bills
                can cause significant financial hardship and cause individuals to forgo
                care. A project carried out by Vox, a news and opinion website, which
                collected emergency department medical bills reported instances of
                accident victims receiving care at out-of-network hospitals and
                receiving bills of over $20,000.\103\ These challenges may be more
                keenly experienced by minority and underserved communities, which are
                more likely to experience poor communication, underlying mistrust of
                the medical system, and lower levels of patient engagement than other
                populations.\104\ Communities experiencing poverty and other social
                risk factors are particularly impacted as surprise medical bills can
                negatively affect individuals' abilities to eliminate debt and create
                wealth, and ultimately can affect a family for generations.\105\
                Effective, culturally, and linguistically tailored communication at
                appropriate literacy levels, along with policies that address the
                social risk factors and other barriers underserved communities face to
                accessing, trusting, and understanding health care costs and coverage
                can reduce disparities and promote health equity.\106\
                ---------------------------------------------------------------------------
                 \102\ Pollitz K., et al., US Statistics on Surprise Medical
                Billing. JAMA. 2020;323(6):498. doi:10.1001/jama.2020.0065.
                 \103\ Kliff S., Surprise medical bills, the high cost of
                emergency department care, and the effects on patients [published
                online August 12, 2019]. JAMA Intern Med. doi:10.1001/
                jamainternmed.2019.3448.
                 \104\ Butler S., Sherriff N. How poor communication exacerbates
                health inequities and what to do about it. Brookings Institution:
                Report (February 22, 2021). https://www.brookings.edu/research/how-poor-communication-exacerbates-health-inequities-and-what-to-do-about-it/; Hamel, L., Lopes, L., Mu[ntilde]ana, C., Artiga, S.,
                Brodie, M. Race, Health, and COVID-19: The Views and Experiences of
                Black Americans. Kaiser Family Foundation (October 2020). https://files.kff.org/attachment/Report-Race-Health-and-COVID-19-The-Views-and-Experiences-of-Black-Americans.pdf; and Shen M.J., Peterson
                E.B., Costas-Mu[ntilde]iz R. et al. The Effects of Race and Racial
                Concordance on Patient-Physician Communication: A Systematic Review
                of the Literature. J. Racial and Ethnic Health Disparities 5, 117-
                140 (2018). https://doi.org/10.1007/s40615-017-0350-4.
                 \105\ Taylor, J., Racism, inequality, and health care for
                African Americans. The Century Foundation: Report (December 19,
                2019). https://tcf.org/content/report/racism-inequality-health-care-african-americans/; and Chavis, B., Op-Ed: Big insurance must help
                end surprise medical billing. blackpressUSA (February 24, 2020).
                https://blackpressusa.com/op-ed-big-insurance-must-help-end-surprise-medical-billing/.
                 \106\ P[eacute]rez-Stable E.J., El-Toukhy S., Communicating with
                diverse patients: How patient and clinician factors affect
                disparities. Patient Educ Couns. 2018;101(12):2186-2194.
                doi:10.1016/j.pec.2018.08.021; McNally, M., Confronting disparities
                in access to healthcare for underserved populations. MedCity News
                (February 22, 2021). https://medcitynews.com/2021/02/confronting-disparities-in-access-to-healthcare-for-underserved-populations-in-2021/.
                ---------------------------------------------------------------------------
                 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 medical bills arise most frequently.
                These interim final rules implement provisions of the No Surprises Act
                that protect individuals from surprise medical bills for emergency
                services, air ambulance services furnished by nonparticipating
                providers, and non-emergency services furnished by nonparticipating
                providers at participating facilities in certain circumstances.
                2. Summary of Impacts
                 The provisions in these interim final rules will ensure that
                participants, beneficiaries, and enrollees with health coverage are
                protected from surprise medical bills. Individuals with health coverage
                will gain peace of mind, experience a reduction in out-of-pocket
                expenses, be able to meet their deductible and out-of-pocket maximum
                limits sooner, and may experience increased access to care. Plans,
                issuers, health care providers, facilities, and providers of air
                ambulance services will incur costs to comply with the requirements in
                these interim final rules. In accordance with OMB Circular A-4, Table 1
                depicts an accounting statement summarizing the Departments' assessment
                of the benefits, costs, and transfers associated with this regulatory
                action. The Departments are unable to quantify all benefits, costs, and
                transfers of these interim final rules but have sought, where possible,
                to describe these non-quantified impacts. The effects in Table 1
                reflect non-quantified impacts and estimated direct monetary costs
                resulting from the provisions of these interim final rules.
                BILLING CODE 4120-01-P
                [[Page 36920]]
                [GRAPHIC] [TIFF OMITTED] TR13JY21.003
                [[Page 36921]]
                [GRAPHIC] [TIFF OMITTED] TR13JY21.004
                BILLING CODE 4120-01-C
                a. Prevalence of Surprise Billing
                 There is extensive research on the incidence of out-of-network
                providers and facilities billing patients for items and services
                furnished at in-network and out-of-network health care facilities. Most
                of these studies analyze claims data to identify cases that may
                potentially result in a surprise medical bill. The studies reveal that
                surprise billing is a significant issue for consumers across the
                country and across all types of coverage. For example, an analysis of
                claims data from large group health plans revealed that while rates
                varied by state, 18 percent of emergency department visits, on average,
                resulted in individuals receiving a surprise medical bill in
                [[Page 36922]]
                2017. The out-of-network charges came either from facilities or
                providers, or both, though the majority of the charges were from
                individual providers, rather than facilities.\107\ In addition, in
                2017, 16 percent of inpatient stays at in-network facilities resulted
                in out-of-network charges, though the rate of out-of-network billing
                varied by state and also between rural and urban areas. Another study
                revealed that admissions at in-network hospitals for surgery and mental
                health/substance use disorders are more likely to include out-of-
                network charges, and women with large-employer coverage who have had a
                mastectomy at an in-network facility were also more likely (21 percent)
                to be billed for out-of-network charges.\108\ An analysis of commercial
                claims data for in-network hospital admissions in 2016 found that out-
                of-network claims occurred in 14.5 percent of admissions, with wide
                variation between states.\109\
                ---------------------------------------------------------------------------
                 \107\ Pollitz K., et al., An examination of surprise medical
                bills and proposals to protect consumers from them,
                Peterson[hyphen]KFF Health System Tracker, February 10, 2020,
                https://www.healthsystemtracker.org/brief/an-examination-of-surprise-medical-bills-and-proposals-to-protect-consumers-from-them-3/.
                 \108\ Pollitz, K. et al., Surprise Bills Vary by Diagnosis and
                Type of Admission, Peterson-KFF Health System tracker, December 9,
                2019, https://www.healthsystemtracker.org/brief/surprise-bills-vary-by-diagnosis-and-type-of-admission/.
                 \109\ Kennedy K. et al., Surprise out-of-network medical bills
                during in-network hospital admissions varied by state and medical
                specialty, 2016, Health Care Cost Institute, March 28, 2019, https://healthcostinstitute.org/out-of-network-billing/oon-physician-bills-at-in-network-hospitals.
                ---------------------------------------------------------------------------
                 A study using 2007-2014 claims data for group health plans
                indicated that in 2014, 20 percent of hospital inpatient admissions
                that originated in the emergency department, 14 percent of outpatient
                emergency department visits, and 9 percent of elective inpatient
                admissions were likely to result in surprise medical bills. In
                approximately 40 percent of inpatient admissions and more than half of
                outpatient cases with surprise bills, issuers paid the claims at an in-
                network level, so the patients were potentially billed for the
                remaining amount.\110\ Another study using claims data from a large
                issuer for the period 2010-2016 found that over 39 percent of emergency
                department visits to in-network hospitals resulted in an out-of-network
                bill, and that the incidence increased from 32.3 percent in 2010 to
                42.8 percent in 2016. The average potential amount of the surprise
                medical bill also increased from $220 in 2010 to $628 in 2016. During
                the same time period, 37 percent of inpatient admissions to in-network
                hospitals resulted in at least one out-of-network bill, increasing from
                26.3 percent in 2010 to 42 percent in 2016 and the average potential
                amount of the surprise medical bill increased from $804 to $2,040.\111\
                ---------------------------------------------------------------------------
                 \110\ Garmon C. and Chatock B., One In Five Inpatient Emergency
                Department Cases May Lead to Surprise Bills, Health Affairs 36, No.
                1 (2017): 177-181.
                 \111\ Sun E.C., Mello M.M., Moshfegh J., Baker LC. Assessment of
                Out-of-Network Billing for Privately Insured Patients Receiving Care
                in In-Network Hospitals. JAMA Intern Med. 2019;179(11):1543-1550.
                doi:10.1001/jamainternmed.2019.3451.
                ---------------------------------------------------------------------------
                 For elective surgeries, analysis of claims data from a large issuer
                revealed that between 2012 and 2017, an out-of-network bill occurred in
                over 20 percent of cases, when the primary surgeon and facility were
                in-network, resulting in potential balance bills ranging from $1,255 to
                $3,449. Occurrences of out-of-network bills were associated with
                significantly higher total charges and out-of-pocket costs for
                patients, compared to cases without out-of-network bills.\112\
                ---------------------------------------------------------------------------
                 \112\ Chhabra K.R. et al., Out-of-Network Bills for Privately
                Insured Patients Undergoing Elective Surgery With In-Network Primary
                Surgeons and Facilities, 2020;323(6):538-547. doi:10.1001/
                jama.2019.21463.
                ---------------------------------------------------------------------------
                 Researchers have also tried to estimate the amounts of surprise
                bills patients receive. A study using 2015 claims data from a large
                issuer for services provided at in-network hospitals concluded that
                average potential balance bills from anesthesiologists, pathologists,
                radiologists, and assistant surgeons were $1,171, $177, $115, and
                $7,420, respectively.\113\ Another study analyzing 2014-2017 data
                related to ambulatory surgical centers from three large issuers
                revealed that in 10 percent of cases, patients treated at in-network
                facilities received care from out-of-network providers, and patients
                may have received surprise bills in 8 percent of cases. On average, the
                amount of the surprise medical bill was $1,141, and the amount
                increased by 81 percent over the period, from $819 in 2014 to $1,483 in
                2017.\114\
                ---------------------------------------------------------------------------
                 \113\ Cooper Z. et al., Out-of-Network Billing And Negotiated
                Payments for Hospital-Based Physicians, Health Affairs 39, No. 1,
                2020. doi: 10.1377/hlthaff.2019.00507.
                 \114\ Duffy E. et al., Prevalence And Characteristics Of
                Surprise Out-of-Network Bills from Professionals in Ambulatory
                Surgery Centers, Health Affairs 39, No. 5, 2020. doi:10.1377/
                hlthaff.2019.01138.
                ---------------------------------------------------------------------------
                 Surprise billing is often associated with certain physician
                specialties, especially those whose services are not actively
                ``shoppable'' by consumers. Researchers analyzing claims data from a
                large issuer for the period 2010-2016 found that for emergency
                department visits, out-of-network bills arose frequently within the
                context of medical transport encounters (resulting in out-of-network
                bills in 85.6 percent of incidents involving ambulances) and the
                following physician specialties: Emergency medicine (32.6 percent),
                anesthesiology (22.8 percent), internal medicine (23.8 percent),
                cardiology (20.9 percent), family practice (20.1 percent), radiology
                (18.1 percent), general surgery (13.3 percent), and pediatrics (8.4
                percent). For inpatient admissions at in-network hospitals, in addition
                to medical transport (81.6 percent of cases involving ambulances), the
                study found that out-of-network bills arose most commonly with the
                following physician specialties: emergency medicine (42.6 percent of
                total inpatient admissions with at least 1 claim submitted by the given
                specialty), internal medicine (25.3 percent), radiology (22.6 percent),
                pathology (22.2 percent), cardiology (19.6 percent), anesthesiology
                (19.3 percent), family practice (18.2 percent), and obstetrics and
                gynecology (0.8 percent).\115\ While emergency medicine physicians make
                up only approximately 5 percent of the total number of active
                physicians,\116\ these studies show that emergency medical physicians
                have the highest percentage of out-of-network claims. Analysis of
                claims data for elective surgeries from a large issuer revealed that
                between 2012 and 2017, out-of-network claims were commonly associated
                with anesthesiologists (in 37 percent of cases), surgical assistants
                (37 percent), pathologists (22 percent), radiologists (7 percent), and
                medical consultants (3 percent).\117\ Another study analyzing
                commercial claims data for in-network inpatient admissions in 2016
                found that some specialties with large shares of out-of-network bills
                were anesthesiology (16.5 percent), primary care (12.6 percent), and
                emergency medicine (11 percent) and that the specialties that most
                often billed as out-of-network at in-network facilities were
                independent labs (22.1 percent), followed by emergency medicine (12
                [[Page 36923]]
                percent).\118\ Another study analyzing 2014-2017 data related to
                ambulatory surgical centers from three large issuers revealed that out-
                of-network bills often came from anesthesiologists (44 percent of
                bills), certified registered nurse anesthetists (25 percent),
                independent laboratories (10 percent) and pathologists (3
                percent).\119\
                ---------------------------------------------------------------------------
                 \115\ Sun E. et al., Assessment of Out-of-Network Billing for
                Privately Insured Patients Receiving Care in In-Network Hospitals.
                JAMA Intern Med. 2019;179(11):1543-1550.
                 \116\ American Association of Medical Colleges. ``Active
                Physicians by Age and Specialty.'' Physician Specialty Data Report.
                (December 2019). https://www.aamc.org/data-reports/workforce/interactive-data/active-physicians-age-and-specialty-2019. The
                American Association of Medical Colleges estimated that among the
                935,136 active physicians in the U.S. in 2019, 45,134 were emergency
                physicians (4.8%).
                 \117\ Chhabra K.R. et al., Out-of-Network Bills for Privately
                Insured Patients Undergoing Elective Surgery With In-Network Primary
                Surgeons and Facilities, 2020;323(6):538-547. doi:10.1001/
                jama.2019.21463.
                 \118\ Kennedy K. et al., Surprise out-of-network medical bills
                during in-network hospital admissions varied by state and medical
                specialty, 2016, Health Care Cost Institute, March 28, 2019, https://healthcostinstitute.org/out-of-network-billing/oon-physician-bills-at-in-network-hospitals.
                 \119\ Duffy E. et al., Prevalence And Characteristics Of
                Surprise Out-of-Network Bills from Professionals in Ambulatory
                Surgery Centers, Health Affairs 39, No. 5, 2020. doi:10.1377/
                hlthaff.2019.01138.
                ---------------------------------------------------------------------------
                 As discussed earlier in this preamble, multiple studies have shown
                that a large percentage of out-of-network bills come from independent
                laboratories. An analysis of 2008-2016 claims data for individuals with
                group health insurance coverage found that there was an increase in the
                share of out-of-network laboratory spending, and that utilization and
                prices for out-of-network laboratory tests increased relative to in-
                network tests during that time period. The number of out-of-network
                laboratory tests increased by 18.9 percent each year, while the number
                of in-network laboratory tests increased by 2.3 percent per year. The
                study authors speculated that large suppliers of laboratory services
                have sufficient market power to set high out-of-network prices and
                utilization by clinicians may be influenced by financial
                incentives.\120\
                ---------------------------------------------------------------------------
                 \120\ Song, Z. et al., JAMA, Out-of-Network Laboratory Test
                Spending, Utilization, and Prices in the US, JAMA.
                2021;325(16):1674-1676. doi:10.1001/jama.2021.0720.
                ---------------------------------------------------------------------------
                 Providers who choose to remain out-of-network usually do so because
                it does not affect their patient volume. The ability to balance bill is
                often used as leverage by such providers to obtain higher in-network
                payments when they join plans' or issuers' networks. Higher in-network
                payments lead to higher premiums,\121\ higher cost sharing for
                consumers, and increased health care expenditures overall. For example,
                hospitals often outsource the staffing of their emergency departments
                to outside firms. A study on out-of-network billing in emergency
                departments looked at the behavior of the two largest emergency
                department staffing firms in the United States.\122\ The study found
                that one firm exits networks when it enters into a contract with a
                hospital, and bills as an out-of-network provider. The other firm
                temporarily exits networks and later rejoins after negotiating higher
                in-network payments.
                ---------------------------------------------------------------------------
                 \121\ Duffy, E. et al., ``Policies to Address Surprise Billing
                Can Affect Health Insurance Premiums.'' The American Journal of
                Managed Care 26.9 (2020): 401-404.
                 \122\ Cooper, Z. et al., Surprise! Out-Of-Network Billing For
                Emergency Care in the United States, NBER Working Paper 23623, 2017,
                available at https://www.nber.org/papers/w23623.
                ---------------------------------------------------------------------------
                 Utilizations of air ambulance services also frequently result in
                surprise bills. A study by the Government Accountability Office (GAO)
                analyzed private health insurance claims from 2012 and 2017 to describe
                the extent to which air ambulance transports are out-of-network.\123\
                This study analyzed claims data from approximately 24,100 transports in
                2012 and another 33,800 transports in 2017 from all 50 states and the
                District of Columbia. The study found that in 2012, 75 percent of
                transports were out-of-network and in 2017, 69 percent were out-of-
                network. The GAO also reported that the median price charged by
                providers of air ambulance services had increased from a rate of
                $22,100 for rotary-wing and $24,900 for fixed-wing in 2012 to
                approximately $36,400 for rotary-wing and $40,600 for a fixed-wing
                transport in 2017. The changes in price between 2012 and 2017 indicate
                a consistent rate of increase as a previously published report by the
                GAO also noted that between 2010 and 2014, the median prices charged by
                providers of air ambulance services for rotary-wing transports
                approximately doubled.\124\ Another study found that for one of the
                largest providers of air ambulance services (with a market share of
                approximately 24 percent) the average charge increased from $17,262.23
                in 2009 to approximately $50,199.24 by 2016.\125\
                ---------------------------------------------------------------------------
                 \123\ GAO (2019) Report to Congressional Committees. Air
                Ambulance. Available Data Show Privately-Insured Patients Are at
                Financial Risk (GAO-19-292) available at: https://www.gao.gov/assets/700/697684.pdf. The data analyzed included claims from over
                50 payers in each year (including both fully- and self-insured
                plans) and accounted for 110.1 million covered lives in 2012 and
                145.0 million covered lives in 2017.
                 \124\ GAO (2017) Report to the Committee on Transportation and
                Infrastructure, House of Representatives. Air Ambulance. Data
                Collection and Transparency Needed to Enhance DOT Oversight. (GAO-
                17-637) available at: https://www.gao.gov/assets/gao-17-637.pdf.
                 \125\ Consumer Union. Up in the Air: Inadequate Regulation for
                Emergency Air Ambulance Transportation. Health Policy Report, March
                2017.
                ---------------------------------------------------------------------------
                 As the costs associated with air ambulance transports continue to
                increase, the GAO reported that providers of air ambulance services
                report entering into more network contracts.\126\ However, additional
                analyses find that many providers of air ambulance services,
                particularly those not affiliated with a hospital, do not participate
                in insurer networks and have little incentive to do so, further noting
                that network participation remains low and provider avoidance of
                insurance network participation combined with aggressive collection
                practices has been described as a business strategy of some providers
                of air ambulance services.\127\
                ---------------------------------------------------------------------------
                 \126\ GAO (2019) Report to Congressional Committees. Air
                Ambulance. Available Data Show Privately-Insured Patients Are at
                Financial Risk (GAO-19-292) available at: https://www.gao.gov/assets/700/697684.pdf.
                 \127\ Missouri Department of Insurance, Financial Institutions &
                Professional Registration. Policy Brief: Health Coverage for Air
                Ambulance Transportation. January 2019; and New Mexico Office of the
                Superintendent of Insurance. Air Ambulance Memorial Study Report.
                January 2017. Available at: https://www.nmlegis.gov/handouts/ERDT%20083117%20Item%208%20NM%20Superintendent%20of%20Insurance%20Air%20Ambulance%20Memorial%20Study%20Report.pdf.
                ---------------------------------------------------------------------------
                 A study using 2014-2017 data from three large issuers to evaluate
                the share of air ambulance claims that are out-of-network and the
                prevalence and magnitude of potential surprise balance bills, found
                that 77 percent of air ambulance transports were out-of-network and
                approximately 40 percent of air ambulance transports resulted in
                potential balance bills. The bills averaged approximately $19,851 in
                addition to the standard out-of-network cost sharing, which averaged
                $561. The study also found that with out-of-network rotary-wing claims,
                issuers paid the providers' full billed charges approximately 48
                percent of the time, at an average of $35,733 and that for in-network
                providers, billed charges were paid in full only 7 percent of the time.
                They noted that self-insured plans paid out-of-network claims in full
                50 percent of the time, whereas fully insured plans paid claims in full
                38 percent of the time.\128\
                ---------------------------------------------------------------------------
                 \128\ Brown, E.C.F. et al., Out-of-Network Air Ambulance Bills:
                Prevalence, Magnitude, and Policy Solutions. The Milbank Quarterly,
                Vol. 98, No. 3, 2020 (pp. 747-774).
                ---------------------------------------------------------------------------
                 A study using claims data from a large issuer to evaluate the
                potential impact of out-of-network emergency medical transport services
                from 2013 to 2017 identified a total of 1,498,600 ambulance encounters
                of which 29,972 (2 percent) were air ambulance encounters, and of these
                26,375 (88 percent) were rotary-wing and 3,597 (12 percent) were fixed-
                wing. The study further noted that the prevalence of potential surprise
                medical billing was an estimated 73 percent for rotary-wing (18,463)
                and 70 percent (2,518) for fixed-wing transports.\129\ The study
                determined that the potential surprise
                [[Page 36924]]
                billing amount for the study period totaled approximately $456 million
                for air ambulance services, with a yearly average of $91 million and a
                median potential surprise medical bill of approximately $27,513.\130\
                ---------------------------------------------------------------------------
                 \129\ Chhabra, H.R., McGuire, K., Scott, J.W., Nuliyalu, U., and
                Ryan, A. Most Patients Undergoing Ground And Air Ambulance
                Transportation Receive Sizable Out-Of-Network Bills. Health Affairs
                39, NO. 5 (2020): 777-782.
                 \130\ This study found that potential surprise bills in the
                study period increased from $41 million in 2013 to $143 million in
                2017. The study further found that the median potential surprise
                bill from air transportation nearly doubled from $14,356 to $27,513,
                or an increase of 15 percent annually, on average, after adjustment
                for inflation and that the prevalence ranged from 25 percent
                (Minnesota) to 93 percent (Massachusetts) with the size of potential
                surprise bills varying widely.
                ---------------------------------------------------------------------------
                 A number of studies have reviewed state investigations or consumer
                complaints to obtain information on the amount of balance billing, and
                costs, associated with air ambulance transports. One study reviewed
                state investigations and found that in North Dakota, of 20 complaints
                against one provider of air ambulance services that charged a total of
                $884,244 (an average of $44,212 per flight), 33 percent of the charges
                were covered by insurance. In an additional nine states, the study
                found that 55 complaints resulted in a combined $3.8 million in
                charges, or an average of $77,000 per trip; and in Montana, the study
                found the average out-of-network rate, of the 19 bills analyzed, was
                $53,397.\131\ The GAO further analyzed 60 consumer complaints related
                to air ambulance services from Maryland and North Dakota and found that
                from 24 complaints in Maryland the balance billed amounts ranged from
                $12,300 to $52,000 and from 36 complaints in North Dakota the balance
                bills ranged from $600 to $66,000.\132\
                ---------------------------------------------------------------------------
                 \131\ Consumer Union. Up in the Air: Inadequate Regulation for
                Emergency Air Ambulance Transportation. Health Policy Report, March
                2017.
                 \132\ GAO (2019) Report to Congressional Committees. Air
                Ambulance. Available Data Show Privately-Insured Patients Are at
                Financial Risk (GAO-19-292) available at: https://www.gao.gov/assets/700/697684.pdf.
                ---------------------------------------------------------------------------
                b. Impact of Surprise Medical Bills
                 A study of out-of-network billing in emergency departments
                considered how some providers use the ability to bill out-of-network to
                increase payments. The study found that charges from out-of-network
                physicians in emergency departments were 637 percent of Medicare
                payments, which is 2.4 times higher than in-network payment rates, on
                average, for identical services. The study also found that emergency
                department physicians were paid in-network rates of 266 percent of
                Medicare payments, a higher percentage of Medicare payment than most
                other specialists.\133\
                ---------------------------------------------------------------------------
                 \133\ Cooper, Z. et al., Surprise! Out-Of-Network Billing For
                Emergency Care in the United States, NBER Working Paper 23623, 2017,
                available at https://www.nber.org/papers/w23623.
                ---------------------------------------------------------------------------
                 Another study using 2017 claims data from 3 large issuers looked at
                expenditures on ancillary and emergency services that are most often
                associated with surprise bills: emergency medicine professionals,
                radiologists, anesthesiologists, pathologists, emergency outpatient
                facilities, and emergency ground ambulance services.\134\ The study
                concluded that a 15 percent reduction in average payments for these
                services would lower premiums by 1.4 percent to 1.6 percent; while a
                reduction in average payments to 150 percent of Medicare rates would
                likely lower premiums by 4.5 percent to 5.1 percent. The authors
                estimated that for all consumers with commercial insurance coverage,
                1.6 percent and 5.1 percent reductions in premiums would result in
                total annual savings of $12 billion and $38 billion, respectively.
                ---------------------------------------------------------------------------
                 \134\ Duffy, E. et al., ``Policies to Address Surprise Billing
                Can Affect Health Insurance Premiums.'' The American Journal of
                Managed Care 26.9 (2020): 401-404.
                ---------------------------------------------------------------------------
                 A study using 2015 claims data from a large issuer for services
                provided at in-network hospitals considered the impact of policies that
                would prevent anesthesiologists, pathologists, radiologists, and
                assistant surgeons from balance billing and would reduce their in-
                network payments to 164 percent of Medicare payments. The study
                concluded that such a reduction in payment would result in savings
                equal to 13.4 percent of spending on physicians and 3.4 percent of
                spending for people with employer-sponsored coverage, approximately $40
                billion annually.\135\
                ---------------------------------------------------------------------------
                 \135\ Cooper Z. et al., Out-of-Network Billing And Negotiated
                Payments for Hospital-Based Physicians, Health Affairs 39, No. 1,
                2020. doi: 10.1377/hlthaff.2019.00507.
                ---------------------------------------------------------------------------
                 Surprise bills result in higher out-of-pocket expenses and cause
                financial anxiety and medical debt for consumers.\136\ As discussed
                earlier in this preamble, the impact is most keenly felt by those
                communities experiencing poverty and other social risk factors.
                Potential surprise bills can vary in size, and are often large, as
                concluded by the studies discussed previously. A Federal Reserve report
                found that about 37 percent of adults in the U.S. in 2019 would not be
                able to pay an unexpected expense of $400 using cash or its
                equivalent.\137\ In a 2016 survey, among the respondents with health
                coverage who reported having difficulty paying medical bills, 75
                percent reported that copayments, deductibles or coinsurance were more
                than they could afford and 32 percent had received out-of-network bills
                that insurance either did not cover or only partially covered.\138\ Of
                those who had difficulty paying out-of-network bills, 69 percent said
                that it was a surprise bill and they had not been aware that the
                provider was out-of-network for their plan. Respondents also reported
                that bills from emergency room visits and hospitalizations often made
                up the largest share of the amount they owed. In the survey,
                respondents reported making sacrifices such as reducing expenditures on
                food, clothing, and basic household items, using up savings, working
                additional jobs or hours, borrowing, changing living arrangements, and
                reducing or delaying vacations or major household purchases. Survey
                respondents also reported being contacted by collection agencies.
                Survey results indicated that 37 percent of individuals with household
                incomes less than $50,000 (compared to 14 percent with incomes of
                $100,000 or more), and 47 percent of individuals with a disability
                (compared to 22 percent of individuals without one) had difficulties
                paying medical bills, demonstrating a disproportionate impact on these
                populations.
                ---------------------------------------------------------------------------
                 \136\ Garmon C. and Chatock B. One In Five Inpatient Emergency
                Department Cases May Lead to Surprise Bills, Health Affairs 36, No.
                1 (2017): 177-181.
                 \137\ Board of Governors of the Federal Reserve System, Report
                on the Economic Well-Being of U.S. Households in 2019--May 2020,
                https://www.federalreserve.gov/publications/2020-economic-well-being-of-us-households-in-2019-dealing-with-unexpected-expenses.htm.
                 \138\ Hamel, Liz et al., The Burden of Medical Debt: Results
                from the Kaiser Family Foundation/New York Times Medical Bills
                Survey, The Henry J. Kaiser Family Foundation, 2016, https://www.kff.org/wp-content/uploads/2016/01/8806-the-burden-of-medical-debt-results-from-the-kaiser-family-foundation-new-york-times-medical-bills-survey.pdf.
                ---------------------------------------------------------------------------
                 In addition, out-of-network cost sharing and surprise bills usually
                do not count towards an individual's deductible or maximum out-of-
                pocket expenditure limit. Therefore, individuals with surprise bills
                may have difficulty reaching those limits, even though they may have
                high health care expenses. This can result in reduced access to care,
                since high medical expenses can cause individuals to delay or forgo
                medical care. In a 2017 survey, 64 percent of respondents reported that
                they had delayed care in the last year because of high medical expenses
                and 44 percent stated that they would forgo care if their out-of-pocket
                expenses
                [[Page 36925]]
                would be more than $500.\139\ Another study reported that 7 percent of
                adults with health insurance delayed or went without care in 2019
                because of cost reasons and adults who are in worse health are twice as
                likely to delay or forgo care because of cost reasons.\140\ This study
                also reported that while 10.5 percent of all adults reported delaying
                or forgoing medical care due to costs, 15.1 percent of Hispanic adults
                and 13 percent of Non-Hispanic Black adults and 17.7 percent of adults
                with income below 200 percent of the federal poverty level reported the
                same, showing the disparate effect of high cost of care on these
                communities. Another survey concluded that 65 million adults had a
                health issue but did not seek treatment because of cost reasons in
                2018.\141\
                ---------------------------------------------------------------------------
                 \139\ Heath, Sara, 64% of Patients Avoid Care Due to High
                Patient Healthcare Costs, Patient Engagement HIT, 2018, https://patientengagementhit.com/news/64-of-patients-avoid-care-due-to-of-high-patient-healthcare-costs.
                 \140\ Amin, K. et al., How Does Cost Affect Access to Care?.
                Peterson-KFF Health System Tracker. January 5, 2021. https://www.healthsystemtracker.org/chart-collection/cost-affect-access-care/#item-start.
                 \141\ Gallup and West Health, The U.S. Healthcare Cost Crisis.
                2019. https://news.gallup.com/poll/248081/westhealth-gallup-us-healthcare-cost-crisis.aspx.
                ---------------------------------------------------------------------------
                 In addition to causing financial hardship, surprise medical bills
                may also cause consumers to change providers in the future. Analysis of
                a large national sample of claims for obstetrics patients who had two
                deliveries covered by insurance found that 11 percent of patients
                received a surprise medical bill for their first delivery and were 13
                percent more likely to switch hospitals for the second delivery
                compared to patients who did not.\142\
                ---------------------------------------------------------------------------
                 \142\ Chartock, B. et al., Consumers' Responses to Surprise
                Medical Bills in Elective Situations, Health Affairs 38, No. 3
                (2019): 425-430.
                ---------------------------------------------------------------------------
                 Individuals living in rural areas experience socioeconomic and
                health related disparities.\143\ Rural areas have fewer primary care
                and mental health providers and higher rates of preventable
                hospitalizations. Currently, there are 1,805 rural hospitals in the
                United States,\144\ with 137 rural hospitals having closed since
                2010.\145\ Individuals who live in rural or geographically remote areas
                often must rely on air ambulance services for transfer to facilities
                with equipment and expertise to treat serious medical conditions. Often
                these transports are costly due to lack of options for in-network
                providers available to provide lifesaving services.\146\ It is
                estimated that a quarter of Americans, approximately 85 million people,
                are unable to access health care in less than an hour of travel time
                without an air ambulance, and air ambulances may be the only viable
                means of transporting patients to the health care center they
                need.\147\ One air ambulance provider estimates that 90 percent of
                their transports originate from rural areas, a defined by CMS.\148\ The
                GAO found that about 60 percent of rotary-wing bases added between 2012
                and 2017 were located in rural areas, and about half of fixed-wing
                bases added between 2012 and 2017 were rural.\149\ As a result of the
                growing reliance on air ambulance services, rural populations are
                disproportionately affected by high costs of air ambulance services.
                ---------------------------------------------------------------------------
                 \143\ North Carolina Rural Health Research Program. Rural Health
                Snapshot (2017). May 2017. https://www.shepscenter.unc.edu/wp-content/uploads/dlm_uploads/2017/05/Snapshot2017.pdf.
                 \144\ American Hospital Association, Fast Facts on U.S.
                Hospitals, 2021. https://www.aha.org/statistics/fast-facts-us-hospitals.
                 \145\ Cecil G. Sheps Center for Health Services Research, UNC.
                Rural Hospital Closures. https://www.shepscenter.unc.edu/programs-projects/rural-health/rural-hospital-closures/.
                 \146\ Haer, A., Senate Bill 1264: The Texan Template for the
                National Fight Against Balance Billing. Texas Law Review, 99(4),
                813-838 (2021).
                 \147\ Hinsdale, J.G. Report of the Council on Medical Services:
                Air Ambulance Regulations and Payments. American Medical
                Association. (2018), available at: https://www.ama-assn.org/system/files/2018-12/i18-cms-report2.pdf.
                 \148\ Air Evac Lifeteam. https://lifeteam.net/history-and-
                mission/
                #:~:text=Approximately%2090%20percent%20of%20Air,are%20based%20in%20r
                ural%20areas.
                 \149\ GAO (2019) Report to Congressional Committees. Air
                Ambulance. Available Data Show Privately-Insured Patients Are at
                Financial Risk (GAO-19-292), available at: https://www.gao.gov/assets/700/697684.pdf.
                ---------------------------------------------------------------------------
                c. Existing State Laws Regarding Balance Billing
                 As of February 5, 2021, 33 states have enacted legislation that
                provides some protection for consumers with regard to balance
                bills.\150\ Laws vary by state; there are differences in the types of
                networks, plans, facilities, and providers that are subject to
                regulations, and in payment standards. While most of these states
                prohibit balance billing for emergency services, many of them also
                prohibit balance billing for certain non-emergency care furnished at
                in-network hospitals. It is possible that states may enact new
                legislation or modify existing legislation in response to the passage
                of the No Surprises Act and these implementing regulations.
                ---------------------------------------------------------------------------
                 \150\ The Commonwealth Fund, State Balance-billing Protections.
                https://www.commonwealthfund.org/sites/default/files/2021-03/Hoadley_state_balance_billing_protections_table_02052021.pdf.
                ---------------------------------------------------------------------------
                 Even within a state that has enacted such protections, those
                protections typically apply only to individuals enrolled in group or
                individual health insurance coverage, as ERISA generally preempts state
                laws that regulate self-insured group health plans sponsored by private
                employers. (Some state laws allow ERISA-covered plans to opt in to the
                consumer protections and process for setting payment under the state
                law.) In addition, states are limited in their ability to address
                surprise bills that involve out-of-state providers.
                 The air ambulance industry currently functions and operates within
                the health care system unlike any other entity or service, only
                somewhat due to the unique nature of the service. There are limited
                avenues for states and the U.S. Department of Transportation (DOT) to
                regulate their operations. States and the DOT have limited authority
                under the ADA to regulate the prices, routes, or services of an air
                carrier, including an air ambulance operator, in air
                transportation.\151\ The intent of the ADA was to allow the prices of
                air transportation services to be controlled by market forces.\152\ The
                ADA defines an ``air carrier'' as ``a citizen of the United States
                undertaking by any means, directly or indirectly, to provide air
                transportation;'' defining ``air transportation'' to include interstate
                air transportation.\153\ The ADA effectively limits the ability of
                states to regulate the prices, routes, or services of air carriers that
                provide transportation services,\154\ explicitly stating that states
                ``may not enact or enforce a law, regulation, or other provision having
                the force and effect of law related to a price, route, or service of an
                air carrier that may provide air transportation.'' \155\ The
                Departments are not aware of any state laws regulating or limiting
                surprise billing or other price control measures with regard to air
                ambulance providers or the air ambulance industry.
                ---------------------------------------------------------------------------
                 \151\ See https://www.transportation.gov/individuals/aviation-consumer-protection/air-ambulance-service.
                 \152\ Missouri Department of Insurance, Financial Institutions &
                Professional Registration. Policy Brief: Health Coverage for Air
                Ambulance Transportation. January 2019.
                 \153\ 49 U.S.C. 40102.
                 \154\ 49 U.S.C. 41713.
                 \155\ 49 U.S.C. 41713(b).
                ---------------------------------------------------------------------------
                 State laws appear to have succeeded in providing some protection to
                consumers from balance billing. A study analyzing the impact of New
                York State's law concluded that the law resulted in a 34 percent
                reduction in surprise billing in the state and lowered in-network
                emergency department physician payments by 9 percent.\156\ In
                [[Page 36926]]
                addition, between the implementation of the law in March 2015 and the
                end of 2018, the law saved individuals in the state over $400 million
                with respect to emergency services.\157\ These savings were partly due
                to a reduction in costs associated with emergency services and a
                greater incentive to participate in provider networks. In New Jersey,
                issuers experienced a reduction in costs associated with emergency and
                inadvertent out-of-network claims since the state law took effect.\158\
                The total spending on involuntary out-of-network services were reduced
                by 56 percent for issuers in the individual market and by 38 percent
                for the issuers in the small group market. A report on California law
                concluded that patients were being protected from surprise medical
                bills in the state and that issuers had broader networks such that 80
                percent to 100 percent of their hospitals and health care facilities
                had no nonparticipating providers practicing there.\159\ A study on the
                impact of California's surprise billing law analyzed claims data for
                provider specialties most affected by the law (anesthesiology,
                diagnostic radiology, pathology, assistant surgeons, and neonatal-
                perinatal medicine) for the pre-implementation period from January 2014
                to June 2017 and the post-implementation period from July 2017 to
                December 2018.\160\ The study concluded that the share of services
                delivered out-of-network by the affected specialties at inpatient
                hospitals and ambulatory surgical centers decreased by 17 percent,
                ranging from a 15 percent reduction for pathology to a 31 percent
                decline for neonatal-perinatal medicine.
                ---------------------------------------------------------------------------
                 \156\ Cooper, Z. et al., Surprise! Out-Of-Network Billing For
                Emergency Care in the United States, NBER Working Paper 23623, 2017,
                available at https://www.nber.org/papers/w23623.
                 \157\ New York State Department of Financial Services. New
                York's Surprise Out-of-Network Protection Law: Report on the
                Independent Dispute Resolution Process. September 2019.
                 \158\ State of New Jersey Department of Banking and Insurance.
                The Out-of-network Consumer Protection, Transparency, Cost
                Containment, and Accountability Act (Pub. L. 2018, c. 32) Data
                Reporting. As of January 31, 2021. https://www.state.nj.us/dobi/division_insurance/oonarbitration/data/210131report.html.
                 \159\ Health Access California. Patients Protected, Providers
                Paid: Data From Three Years of California's Compromise to Stop
                Surprise Medical Bills. September 2019. https://health-access.org/wp-content/uploads/2019/09/ha-factsheet-AB72report-final.pdf.
                 \160\ Adler, L. et al. California Saw Reduction In Out-Of-
                Network Care From Affected Specialties After 2017 Surprise Billing
                law. U.S.C.-Brookings Schaeffer Initiative for Health Policy,
                September 26, 2019. https://www.brookings.edu/blog/usc-brookings-schaeffer-on-health-policy/2019/09/26/california-saw-reduction-in-out-of-network-care-from-affected-specialties-after-2017-surprise-billing-law/.
                ---------------------------------------------------------------------------
                d. Benefits
                 Provisions in these interim final rules will protect participants,
                beneficiaries, or enrollees with health coverage from receiving
                surprise bills for emergency services, air ambulance services furnished
                by nonparticipating providers, and non-emergency services furnished by
                nonparticipating providers at participating facilities in certain
                circumstances. Providers will no longer be able to balance bill an
                individual for emergency services. A provider will only be able to
                balance bill an individual for certain post-stabilization services, and
                for services performed by nonparticipating providers at certain
                participating facilities, if the provider or facility provides notice
                to the participant, beneficiary, or enrollee, and obtains the
                individual's consent to receive care on an out-of-network basis and be
                balance billed. Further, provisions ensuring all relevant civil rights
                protections are upheld and communication with consumers is accessible,
                in a language that is understandable, and at an appropriate literacy
                level, help to effectively confer these protections to minority and
                underserved communities.
                 These interim final rules also specify that for emergency services
                furnished by a nonparticipating provider or emergency facility, and for
                non-emergency services furnished by nonparticipating providers in a
                participating health care facility, cost sharing is generally
                calculated as if the total amount that would have been charged for the
                services by a participating emergency facility or participating
                provider were equal to the recognized amount for such services, as
                defined by the statute and in these interim final rules, while for
                nonparticipating providers of air ambulance services, cost sharing is
                generally calculated as if the total amount that would have been
                charged for the services by a participating provider of air ambulance
                services were equal to the lesser of the billed amount or QPA, as
                defined by the statute and in these interim final rules.
                 In addition, these interim final rules require that these cost-
                sharing amounts be counted toward any in-network deductible or in-
                network out-of-pocket maximums applied under the plan or coverage in
                the same manner as if such cost-sharing payments were made with respect
                to services furnished by a participating provider, participating
                facility, or participating provider of air ambulance services.
                 Consider, for example, one case included in the project by
                Vox,\161\ where a victim of a violent attack was taken to an emergency
                facility. When the individual was able, he checked to make sure that
                the hospital was in-network for his plan. He was not aware, however,
                that the surgeon who performed emergency jaw surgery was
                nonparticipating for his plan and the individual received a surprise
                bill of $7,924. Two other cases in the same study included an
                individual involved in a bike crash and another individual hit by a
                public bus. Both individuals were treated at the same emergency
                facility, which was out-of-network for both their plans and received
                surprise bills of $20,243 and $27,660, respectively. In another case,
                the parents of an infant who needed an inter-facility air ambulance
                transport for urgent surgery received a surprise medical bill of
                approximately $64,000 from the air ambulance provider.\162\ Another
                case reported in the media \163\ involved an expectant mother choosing
                an in-network hospital and a participating obstetrician for the birth
                of her baby. However, a nonparticipating pediatrician was called in due
                to a potential risk of post-delivery complications for the baby. The
                mother later received a surprise bill of $636 from the pediatrician
                because her plan had denied the claim. In each of these situations,
                plans and issuers either denied the claim or paid the nonparticipating
                provider, nonparticipating facility, or nonparticipating provider of
                air ambulance services an amount that the plan or issuer considered
                reasonable for the services provided, and the nonparticipating provider
                or nonparticipating facility sent a balance bill to the individual.
                Under the No Surprises Act and these interim final rules, individuals
                in similar situations will only be responsible for in-network cost-
                sharing amounts and deductibles. Nonparticipating providers and
                nonparticipating facilities will not be able to balance bill such
                individuals, but instead will need to agree to an amount of payment
                with plans and issuers or enter into the independent dispute resolution
                process to determine an appropriate payment amount, if
                [[Page 36927]]
                agreement on a payment amount cannot be reached.
                ---------------------------------------------------------------------------
                 \161\ Kliff S. Surprise medical bills, the high cost of
                emergency department care, and the effects on patients [published
                online August 12, 2019]. JAMA Intern Med. doi:10.1001/
                jamainternmed.2019.3448.
                 \162\ Wingerter, Megan. $64K Air Ambulance Tab Shows Limits of
                Surprise Billing Law. Claims Journal. January 4, 2021. https://www.claimsjournal.com/news/national/2021/01/04/301271.htm.
                 \163\ Herman, Bob. Billing squeeze: Hospitals in middle as
                insurers and doctors battle over out-of-network charges. Modern
                Healthcare, August 29, 2015. https://www.modernhealthcare.com/article/20150829/MAGAZINE/308299987/billing-squeeze-hospitals-in-middle-as-insurers-and-doctors-battle-over-out-of-network-charges.
                ---------------------------------------------------------------------------
                 Therefore, individuals with health coverage, including members of
                minority and underserved communities, are likely to see a significant
                reduction in balance billing, reducing one source of anxiety, financial
                stress, and medical debt. They will also experience a reduction in out-
                of-pocket expenditures, because they will only be liable for their in-
                network cost-sharing amounts when receiving care from nonparticipating
                providers, emergency facilities, and providers of air ambulance
                services, which will now count towards their deductible and maximum
                out-of-pocket limits, allowing individuals to reach those limits
                sooner. As discussed previously in this preamble, a significant number
                of individuals forgo or delay care due to the cost of care. A reduction
                in out-of-pocket expenses is likely to improve access to care and allow
                individuals to obtain needed treatment that they may otherwise have
                neglected or foregone due to concerns about the cost of care.
                 These interim final rules also establish a complaints process for
                receiving and resolving complaints related to these new surprise
                billing protections. The Departments are of the view that this will
                result in increased compliance with balance billing requirements and
                ensure that all individuals, including members of minority and
                underserved communities, are able to benefit from the protections
                provided by the No Surprises Act and these interim final rules. The
                Departments also seek comment from members of minority and underserved
                communities to help identify barriers to individuals exercising their
                rights under the No Surprises Act, as well as policies to address and
                remove such barriers.
                 The No Surprises Act extends the applicability of the patient
                protections for choice of health care professionals to grandfathered
                health plans. Participants, beneficiaries, and enrollees in
                grandfathered plans will now be able to designate any participating
                primary care provider who is available to accept the participant,
                beneficiary, or enrollee. If patients are able to choose physicians
                they trust and with whom they have a good relationship, they are likely
                to have better health outcomes.\164\ Similarly, allowing physicians
                specializing in pediatrics to become primary care physicians for
                children will also improve health outcomes for children. The American
                Academy of Pediatrics (AAP) strongly supports the idea that the choice
                of primary care clinicians for children should include
                pediatricians.\165\ In addition, a female participant, beneficiary, or
                enrollee in a grandfathered plan who seeks coverage for obstetrical or
                gynecological care provided by a participating health care professional
                who specializes in obstetrics or gynecology will not need an
                authorization or referral by the plan, issuer, or any person (including
                a primary care provider), which will allow them to obtain care without
                any delay.
                ---------------------------------------------------------------------------
                 \164\ Olaisen, R., et al., ``Assessing the Longitudinal Impact
                of Physician-Patient Relationship on Functional Health.'' The 18
                Annals of Family Medicine 5 (2020). https://www.annfammed.org/content/18/5/422.
                 \165\ See AAP Policy Statement, ``Guiding Principles for Managed
                Care Arrangements for the Health Care of Newborns, Infants,
                Children, Adolescents, and Young Adults''. https://pediatrics.aappublications.org/content/pediatrics/132/5/e1452.full.pdf.
                ---------------------------------------------------------------------------
                 The potential financial savings to consumers as a result of the
                protections in these interim final rules are significant. As of January
                1, 2022, individuals across the country will no longer receive surprise
                medical bills for out-of-network emergency services, non-emergency
                services provided by nonparticipating providers at certain
                participating health care facilities, or air ambulance services. The
                Departments understand that some of these savings will result instead
                in cost transfers from participants, beneficiaries, and enrollees to
                group health plans or issuers, as discussed later in this preamble, or
                may ultimately be paid for by individuals in the form of increased
                health insurance premiums, which will be discussed in future
                rulemaking. However, the Departments anticipate that there are
                potentially additional cost savings for individuals, but are unaware of
                comprehensive national data that quantifies the potential financial
                benefits to individuals of the surprise billing protections included in
                these rules and invite stakeholders to share relevant data that would
                help the Departments quantify this potential consumer financial
                benefit.
                e. Costs
                 Plans, issuers, health care providers, facilities, and providers of
                air ambulance services will incur significant costs to comply with the
                requirements of these interim final rules.
                 These interim final rules specify that for emergency services
                furnished by a nonparticipating provider or emergency facility, and for
                non-emergency services furnished by nonparticipating providers in a
                participating health care facility, cost sharing is generally
                calculated as if the total amount that would have been charged for the
                services by a participating emergency facility or participating
                provider were equal to the recognized amount for such services, as
                defined by the No Surprises Act and these interim final rules. For
                nonparticipating providers of air ambulance services, cost sharing is
                generally calculated as if the total amount that would have been
                charged for the services by a participating provider of air ambulance
                services were equal to the lesser of the billed amount or the QPA, as
                defined by the statute and in these interim final rules. In addition,
                these interim final rules require that such cost sharing must also be
                counted toward any in-network deductible or in-network out-of-pocket
                maximums applied under the plan or coverage in the same manner as if
                such cost sharing payments were made with respect to services furnished
                by a participating provider, a participating facility, or a
                participating provider of air ambulance services.
                 Under these interim final rules, cost-sharing for emergency
                services furnished by a nonparticipating provider or emergency
                facility, and for non-emergency services furnished by nonparticipating
                providers in a participating health care facility, must be calculated
                based on the ``recognized amount,'' which is: (1) An amount determined
                by an applicable All-Payer Model Agreement under section 1115A of the
                Social Security Act, (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 amount for the services or the QPA,
                which generally is the median of the contracted rates of the plan or
                issuer for the item or service furnished in the applicable geographic
                region. For air ambulance services, subject to these interim final
                rules, plans and issuers generally must use the QPA to calculate cost
                sharing.
                 Plans and issuers will incur significant costs to calculate the
                recognized amount and applicable cost-sharing amount. The Departments
                assume that for self-insured group health plans, the costs will be
                incurred by third party administrators (TPAs). The Departments estimate
                a total 1,758 entities--1,553 issuers \166\ and 205
                [[Page 36928]]
                TPAs \167\--will be required to comply with these interim final rules
                with regard to calculating the QPA and to calculate an individual's
                cost sharing liability. The Departments anticipate that issuers and
                TPAs will need to make changes to their information technology (IT)
                systems to include the capability to calculate the QPA for all out-of-
                network claims subject to the surprise billing protections, or the
                amount determined by state law or All-Payer Model Agreement, if
                applicable, and provide the required information related to the QPA to
                nonparticipating providers and nonparticipating emergency facilities.
                In addition, system changes will be necessary to accept and process
                out-of-network claims, calculate the appropriate cost-sharing amounts
                and include them in deductible and out-of-pocket maximum limits. The
                one-time cost to make system changes to include these new
                functionalities may be slightly lower for plans (or TPAs) and issuers
                already subject to state balance billing laws. The Departments estimate
                that each plan (or TPA) or issuer will incur one-time costs of
                approximately $2.8 million, on average, to make the necessary system
                changes to automate the process. The total costs for all plans (or
                TPAs) and issuers will be approximately $4,958 million. The Departments
                assume that these one-time costs will be incurred in 2021. In addition,
                each issuer or TPA will incur ongoing costs related to system
                maintenance, processing out-of-network claims and to acquire external
                data necessary to calculate the QPA when there is insufficient
                information to calculate median contracted rates starting in 2022. The
                Departments estimate each issuer or TPA will incur, on average, ongoing
                costs of $1.2 million in 2022 and approximately $411,840 annually
                starting in 2023. The total annual costs for all issuers and TPAs will
                be $2,047 million in 2022 and $724 million annually starting in 2023.
                See Tables 2 and 3 for more details. The Departments seek comment on
                these estimates.
                ---------------------------------------------------------------------------
                 \166\ Based on data from MLR annual report for the 2019 MLR
                reporting year, available at https://www.cms.gov/CCIIO/Resources/Data-Resources/mlr.
                 \167\ Non-issuer TPAs based on data derived from the 2016
                Benefit Year reinsurance program contributions.
                 \168\ The CALC tool (https://calc.gsa.gov/) was built to assist
                acquisition professionals with market research and price analysis
                for labor categories on multiple U.S. General Services
                Administration (GSA) & Veterans Administration (VA) contracts. Wages
                obtained from the CALC database are fully burdened to account for
                fringe benefits and overhead costs.
                 \169\ See May 2020 Bureau of Labor Statistics, Occupational
                Employment Statistics, National Occupational Employment and Wage
                Estimates, available at https://www.bls.gov/oes/current/oes_nat.htm.
                 Table 2--One-Time IT Costs Related Costs for Plans and Issuers in 2021
                ----------------------------------------------------------------------------------------------------------------
                 2021
                 Hourly wage -------------------------------
                 Occupation: rate Estimated
                 Time (hours) labor cost
                ----------------------------------------------------------------------------------------------------------------
                 IT Costs
                ----------------------------------------------------------------------------------------------------------------
                Project Manager/Team Lead....................................... $110.00 2,080 $228,800
                Scrum Master.................................................... 110.00 3,640 400,400
                Senior Business Analysis........................................ 134.00 1,560 209,040
                UX Researcher/Service Designer.................................. 129.00 2,080 268,320
                Technical Architect/Sr. Developer............................... 207.00 2,080 430,560
                DevOps Engineer/Security Engineer............................... 143.00 1,560 223,080
                Application Developer........................................... 111.00 9,360 1,038,960
                 -----------------------------------------------
                 Total IT Costs for Each Issuer or TPA....................... .............. 22,360 2,799,160
                 Total IT Costs for all Issuers and TPAs................. .............. 39,308,880 4,920,923,280
                ----------------------------------------------------------------------------------------------------------------
                 Management Costs
                ----------------------------------------------------------------------------------------------------------------
                Chief Executives................................................ 190.24 80 15,219
                Lawyers......................................................... 143.18 40 5,727
                 -----------------------------------------------
                 Total....................................................... .............. 120 20,946
                 Total Management Costs for all plans and issuers........ .............. 210,960 36,823,771
                 Total Costs for all Issuers and TPAs.................... .............. 39,519,840 4,957,747,051
                ----------------------------------------------------------------------------------------------------------------
                Note: All wage rates except those related to management costs use the Contract Awarded Labor Category (CALC)
                 tool.\168\ Wage rates for management costs are derived using data from the Bureau of Labor Statistics to
                 derive average labor costs (including a 100 percent increase for fringe benefits and overhead).\169\
                 Table 3--Ongoing Annual Operational Costs for Issuers and TPAs starting in 2022
                ----------------------------------------------------------------------------------------------------------------
                 2022 2023 onwards
                 Hourly wage ---------------------------------------------------------------
                 Occupation: rate Estimated Estimated
                 Time (hours) labor cost Time (hours) labor cost
                ----------------------------------------------------------------------------------------------------------------
                Project Manager/Team Lead....... $110.00 1,040 $114,400 520 $57,200
                Scrum Master.................... 110.00 1,300 143,000 520 57,200
                Senior Business Analysis........ 134.00 780 104,520 0 0
                UX Researcher/Service Designer.. 129.00 780 100,620 0 0
                Technical Architect/Sr. 207.00 1,040 215,280 520 107,640
                 Developer......................
                DevOps Engineer/Security 143.00 780 111,540 520 74,360
                 Engineer.......................
                Application Developer........... 111.00 3,380 375,180 1,040 115,440
                 -------------------------------------------------------------------------------
                 Total for Each Plan or .............. 9,100 1,164,540 3,120 411,840
                 Issuer.....................
                [[Page 36929]]
                
                 Total Costs for all .............. 15,997,800 2,047,261,320 5,484,960 724,014,720
                 Issuers and TPAs.......
                ----------------------------------------------------------------------------------------------------------------
                 Issuers and TPAs will also need to revise their standard operating
                procedures to include processes related to out-of-network claims,
                recognized amount and QPA, and provide training to their billing
                personnel and customer service representatives. The Departments assume
                that, for each issuer or TPA, a business operations specialist will
                need 40 hours (at an hourly labor cost of $81.06) and a senior manager
                (at an hourly labor cost of $114.24) will need 16 hours to revise the
                standard operating procedures, with a total cost of approximately
                $5,070. In addition, the Departments assume that, on average, 10 staff
                at each issuer and TPA will receive 4 hours of training at a cost of
                $1,824. For all 1,758 issuers and TPAs, the total cost of revising
                standard operating procedures and training will be $12.1 million. The
                Departments assume that these one-time costs will be incurred in 2021
                and that new staff will be trained as a part of the usual on-boarding
                process at minimal additional cost and burden.
                 Health care and emergency facilities will also incur costs to
                revise their standard operating procedures and provide training to
                their staff regarding notice and consent requirements, patient
                disclosures, and out-of-network billing. The Departments estimate that
                there are 16,992 emergency and health care facilities (6,090
                hospitals,\170\ 270 independent freestanding emergency
                departments,\171\ 9,280 ambulatory surgical centers,\172\ and 1,352
                critical access hospitals) that will incur this cost. The Departments
                assume that for hospital-affiliated freestanding emergency departments,
                the disclosure will be developed by the parent hospitals. The
                Departments estimate that, on average, for each health care facility, a
                business operations specialist will need 40 hours and a senior manager
                will need 16 hours to revise the standard operating procedures, with a
                total cost of approximately $5,070. In addition, on average, 10 staff
                at each hospital will receive 4 hours of training at a cost of
                approximately $1,824. This estimate is an average of the costs and
                burden to be incurred by each health care facility and the Departments
                recognize that the costs and burden may vary depending on the size of
                each health care facility. The total one-time cost for 16,992 health
                care facilities is estimated to be approximately $117.2 million, to be
                incurred in 2021, with the expectation that new staff will be trained
                as a part of the usual on-boarding process at minimal additional cost
                and burden.
                ---------------------------------------------------------------------------
                 \170\ American Hospital Association, Fast Facts on U.S.
                Hospitals, 2021. Available at https://www.aha.org/statistics/fast-facts-us-hospitals.
                 \171\ Emergency Medicine Network, 2018 National Emergency
                Department Inventory--USA. Available at https://www.emnet-usa.org/research/studies/nedi/nedi2018/.
                 \172\ Moriarty, A., Definitive Healthcare, How Many Ambulatory
                Surgery Centers are in the US?. Blog. April 10, 2019. Available at:
                https://blog.definitivehc.com/how-many-ascs-are-in-the-
                us#:~:text=Currently%2C%20there%20are%20more%20than,Healthcare's%20pl
                atform%20on%20surgery%20centers.
                ---------------------------------------------------------------------------
                 Providers of air ambulance services will also incur costs to revise
                their standard operating procedures and provide training to their staff
                regarding out-of-network billing. The Departments assume that for each
                air ambulance provider, a business operations specialist will need 40
                hours and a senior manager will need 16 hours to revise the standard
                operating procedures, with a total cost of approximately $5,070. In
                addition, on average, 10 staff for each provider will receive 4 hours
                of training at a cost of approximately $1,824. The total on-time cost
                for each provider of air ambulance services will be approximately
                $6,894 in 2021. The total one-time cost for 75 providers of air
                ambulance services \173\ is estimated to be approximately $517,086, to
                be incurred in 2021, with the expectation that new staff will be
                trained as a part of the usual on-boarding process at minimal
                additional cost and burden.
                ---------------------------------------------------------------------------
                 \173\ Federal Aviation Administration, Fact Sheet--FAA
                Initiatives to Improve Air Ambulance Safety, 2014, https://www.faa.gov/news/fact_sheets/news_story.cfm?newsId=15794.
                ---------------------------------------------------------------------------
                 The Departments estimate that grandfathered plans and issuers will
                incur a total cost of approximately $4,516,225 in 2022 to provide the
                notice of right to designate a primary care provider to participants,
                beneficiaries, and enrollees. Self-insured plans opting in to state law
                will incur one-time costs of $50,708 in 2022 to include a disclosure in
                plan documents. TPAs and issuers will also incur costs of approximately
                $55.4 million annually to share information related to QPAs with
                nonparticipating providers, nonparticipating emergency facilities, and
                nonparticipating providers of air ambulance services. Additionally,
                issuers and TPAs will incur costs to make publicly available, post on a
                public website of the plan or issuer, and include on each explanation
                of benefits the disclosure regarding patient protections against
                balance billing. The Departments estimate a one-time cost, incurred in
                2021, for all issuers and TPAs to be $699,245 and ongoing annual costs,
                to begin in 2022, of approximately $23.4 million. These costs are
                discussed in detail in the Paperwork Reduction Act section of this
                preamble.
                 Nonparticipating providers and nonparticipating emergency
                facilities may balance bill a participant, beneficiary, or enrollee if
                certain notice and consent requirements have been met. Providers and
                facilities will incur costs to prepare the notice, provide notice and
                receive consent from patients, retain records, and provide notice to
                plans and issuers. HHS estimates that the one-time cost to prepare the
                notice and consent documents will be approximately $22.6 million in
                2021. The ongoing annual cost to provide the notice and obtain consent,
                retain records and provide notice to plans and issuers is estimated to
                be approximately $117.2 million starting in 2022. In addition,
                individuals receiving the notice and consent, where applicable, will
                incur costs of approximately $99.1 million annually, starting in 2022,
                to read and understand the notice. These costs are discussed in detail
                in the Paperwork Reduction Act section of this preamble.
                 Health care providers and facilities will also incur costs to make
                publicly available, post on a public website of the provider or
                facility, and provide to participants, beneficiaries, and enrollees a
                one-page notice disclosure on patient protections against surprise
                billing and for providers and facilities to enter into agreements for
                the facilities to provide the disclosure on behalf of the providers,
                HHS estimates the one-time total cost, to be incurred in 2021, to be
                [[Page 36930]]
                approximately $13.1 million and the ongoing annual cost, to begin in
                2022, to be approximately $2.5 million. HHS encourages states to
                develop language to assist facilities in fulfilling this disclosure
                requirement as it applies to disclosing state protections against
                balance billing. HHS estimates that the 33 states that currently have
                legislation to provide some protection to consumers for surprise
                billing will incur one-time costs of approximately $10,732 in 2021 to
                develop the model language. These costs are discussed in detail in the
                Paperwork Reduction Act section of this preamble.
                 The No Surprises Act directs the Departments to establish a process
                to receive complaints regarding violations of the application of the
                QPA by group health plans and health insurance issuers offering group
                or individual health coverage. Individuals and entities that submit a
                complaint related to surprise billing will also incur costs to do so.
                As discussed in the Paperwork Reduction Act section of the preamble,
                the Departments estimate related costs to be approximately $97,452
                annually starting in 2022. In addition, the federal government will
                incur a one-time cost of approximately $16 million in 2021 to build the
                IT system to receive and process complaints, an additional $3 million
                to update existing systems in 2021, and ongoing annual costs of
                approximately $1.6 million in 2021, $9.9 million in 2022, $10.1 million
                in 2023 and $10.3 million in 2024 and subsequent years to process the
                complaints received and for system maintenance.
                 As discussed previously, individuals with protections against
                surprise billing are likely to experience a reduction in out-of-pocket
                expenses. This may increase their use of health care, which could lead
                to an increase in health care expenditures overall.
                 The Departments seek comment on these estimates and also on any
                additional costs incurred by plans, issuers, providers, and facilities.
                f. Transfers
                 The provisions in these interim final rules will result in lower
                out-of-pocket spending by individuals. In situations where surprise
                bills currently occur, participants, beneficiaries, and enrollees will
                be responsible for only an approximation of the cost-sharing amounts
                they would have paid had the services been provided by a participating
                emergency facility, participating provider, or participating provider
                of air ambulance services. Plans and issuers will now be required to
                pay for some expenses for items and services provided by
                nonparticipating facilities, providers, and providers of air ambulance
                services that they previously did not pay for. Thus, expenditures will
                shift from certain individuals to plans and issuers. In addition, it is
                possible the out-of-network rates collected by some providers,
                including air ambulance providers, and facilities will be lower than
                they would have been if the providers and facilities were able to
                balance bill the individuals. Such situations will result in transfers
                from providers and facilities to individuals. If there is a decrease in
                payments to some participating providers, as has happened for in-
                network emergency department physician payments in the state of New
                York,\174\ there will be a transfer from those providers to plans,
                issuers, participants, beneficiaries, and enrollees.
                ---------------------------------------------------------------------------
                 \174\ Cooper, Z. et al., Surprise! Out-Of-Network Billing For
                Emergency Care in the United States, NBER Working Paper 23623, 2017,
                available at https://www.nber.org/papers/w23623.
                ---------------------------------------------------------------------------
                 As discussed previously in this preamble, these interim final rules
                are the first of several rules implementing the No Surprises Act and
                the transparency provisions of title II of Division BB of the CAA.
                Later this year, the Departments intend to issue additional regulations
                including regulations regarding the federal IDR process. The impact of
                the provisions of the No Surprises Act on premiums will depend on
                provisions not included in these interim final rules, and more detailed
                analysis will therefore be included in future rulemaking.\175\
                ---------------------------------------------------------------------------
                 \175\ These interim final rules and the forthcoming regulations
                are interrelated, and in cases such as this, attribution of impacts
                is challenging. Inclusion of more detailed analysis in later
                rulemaking, rather than these interim final rules--about, for
                example, changes in premiums incentivized by the suite of surprise
                billing policies--should not be interpreted as indicating certainty
                that such impacts will not occur as a result of these interim final
                rules.
                ---------------------------------------------------------------------------
                C. Regulatory Alternatives
                 In developing the interim final rules, the Departments considered
                various alternative approaches.
                 Determining the Cost-sharing Amount. The No Surprises Act generally
                requires that cost sharing for items and services subject to the
                surprise billing protections be based on the recognized amount. In
                instances where this requirement applies, the Departments considered
                whether it should apply where the billed charge is less than the
                recognized amount. In these instances, assuming the plan or issuer
                would not pay more than the billed charge, calculating cost sharing
                based on the QPA (which is one way in which the recognized amount might
                be determined) would require a participant, beneficiary, or enrollee to
                pay a higher percentage in cost sharing than if such items or services
                had been furnished by a participating provider. However, sections
                9816(a)(1)(C)(ii) and 9816(b)(1)(A) of the Code, sections
                716(a)(1)(C)(ii) and 716(b)(1)(A) of ERISA, and sections 2799A-
                1(a)(1)(C)(ii) and 2799A-1(b)(1)(A) of the PHS Act expressly prohibit
                plans and issuers from applying a cost-sharing requirement that is
                greater than the requirement that would apply if services were provided
                by a participating provider or a participating emergency facility.
                Therefore, under these interim final rules, in circumstances where an
                All-Payer Model Agreement or specified state law does not apply to
                determine the recognized amount, cost sharing must be based on the
                lesser of the QPA or the amount billed by the provider for the item or
                service.
                 Methodology for Calculating the QPA. The No Surprises Act generally
                requires the QPA to be calculated based on the median of the contracted
                rates of the plan or issuer. The Departments considered whether plans
                and issuers should take into account the number of claims paid at the
                contracted rate under each contract in calculating the QPA. Doing so,
                however, would not result in a pure median of the contracted rates,
                which the Departments are of the view would most clearly follow the
                language of the No Surprises Act. In addition, the Departments are of
                the view that this approach would likely put upward pressure on the
                QPA, by giving greater weight to contracts of larger provider groups
                and facilities, which are more likely to have negotiated higher rates
                than small provider groups and facilities. This approach could lead to
                higher out-of-pockets costs for individuals.
                 The Departments also considered requiring plans and issuers to
                calculate separate median contracted rates for facilities based on the
                characteristics of facilities, such as by distinguishing teaching
                hospitals from non-teaching hospitals, rather than distinguishing only
                on the basis of whether the facility is an emergency department of a
                hospital or an independent freestanding emergency department. The
                Departments decided against this approach, as doing so would result in
                a higher median contracted rate for facilities with higher operating
                costs and is not clearly contemplated in the definition of QPA under
                the No Surprises Act. The Departments are of the view that the
                different operating costs among facilities with different
                characteristics should not have such a
                [[Page 36931]]
                dramatic impact on median contracted rates. However, the Departments
                recognize that payment amounts for facility charges may vary depending
                on whether an emergency facility is connected with a hospital.
                Therefore, the interim final rules allow separate median contracted
                rates to be calculated for emergency services based on whether the
                facility is an emergency department of a hospital or an independent
                freestanding emergency department.
                 With respect to calculating a separate QPA for each item and
                service for each geographic region, the Departments considered whether
                to define each geographic region as the applicable rating area as
                defined for purposes of the individual and small group market rating
                rules under PHS Act 2701 section and 45 CFR 147.102, while allowing
                states the flexibility to establish alternative geographic regions.
                However, some states define rating area by county, resulting in large
                numbers of rating areas in a state, some of which might include few, if
                any, facilities and providers. Therefore, adopting rating area as the
                standard for geographic region could lead to a large number of
                geographic regions for which a plan or issuer would have to calculate
                separate median contracted rates, a large number of geographic regions
                without sufficient information, as well as a large number of geographic
                regions in which the median contracted rate is influenced by outliers.
                Therefore, the interim final rules do not adopt this approach to
                defining geographic regions.
                 With respect to the statutory requirement for plans and issuers to
                calculate separate QPAs for each insurance market, including for self-
                insured group health plans, the Departments considered whether the
                market for self-insured group health plans should be limited to only
                self-insured group health plans offered by the same plan sponsor.
                However, this could lead to greater instances of a self-insured plan
                lacking sufficient information, so the interim final rules instead
                define the self-insured market as all self-insured group health plans
                offered by the same plan sponsor, or at the option of the plan sponsor,
                all self-insured group health plans administered by the same entity
                that is responsible for determining the QPA on behalf of the plan
                (including a third-party administrator contracted by the plan).
                 Participant, Beneficiary, and Enrollee Responsibility to Pay
                Recognized Amount Only. In instances where a participant, beneficiary,
                or enrollee has not satisfied their deductible, the Departments
                considered whether the plan or issuer should not be required to pay any
                portion of the out-of-network rate to the nonparticipating provider or
                facility. However, these interim final rules require that when the out-
                of-network rate exceeds the recognized amount (the amount upon which
                cost sharing is based), a plan or issuer must pay the provider or
                facility the difference between the out-of-network rate and the cost-
                sharing amount (the latter of which in this case would equal the
                recognized amount), even in instances where an individual has not
                satisfied their deductible. This approach is consistent with the
                purpose of the No Surprises Act to protect participants, beneficiaries,
                or enrollees from surprise balance bills that exceed in-network cost-
                sharing requirements. This approach is also consistent with section 102
                of the No Surprises Act, which amends section 223 of the Code to
                specify that these payments will not prevent a plan from qualifying as
                a high-deductible health plan or make an individual ineligible to
                contribute to a health savings account.
                 Definition of Health Care Facility. The No Surprises Act defines a
                health care facility as each of the following with respect to non-
                emergency services: (1) A hospital (as defined in 1861(e) of the Social
                Security Act); (2) a hospital outpatient department; (3) a critical
                access hospital (as defined in section 1861(mm)(1) of the Social
                Security Act); (4) an ambulatory surgical center described in section
                1833(i)(1)(A) of the Social Security Act; or (5) any other facility,
                specified by the Departments, that provides items or services for which
                coverage is provided under the plan or coverage, respectively. The
                Departments considered whether to expand the definition of health care
                facility in this rulemaking, but concluded that the facilities at which
                balance billing are currently most frequent are included in the current
                definition. The Departments anticipate continuing to monitor the
                prevalence of surprise billing at various facilities and may expand the
                definition in future rulemaking. In particular, as discussed earlier in
                this preamble, the Departments considered including urgent care centers
                in the definition of health care facility. However, given the variation
                across states in how urgent care centers are licensed, including the
                scope of services that the centers are permitted to provide, the
                Departments decided to instead seek comment regarding whether the
                definition of health care facility should be extended to urgent care
                centers, including those that are not licensed as facilities under
                state law.
                 With respect to the definition of participating health care
                facility and participating emergency facility, the Departments
                considered excluding facilities that had only single case agreements in
                place with a plan or issuer. However, the Departments are persuaded
                that doing so could harm participants, beneficiaries or enrollees. When
                individuals are provided with care, generally non-emergency items or
                services, under a single case agreement, they should not have to worry
                about potential surprise bills. Excluding facilities with single case
                agreements from the definitions of participating facilities and
                participating emergency facilities would be inconsistent with the
                Departments' intent to protect individuals from surprise medical bills.
                 Applicability of State Law. In determining how state laws around
                balance billing would intersect with the No Surprises Act, the
                Departments considered alternatives to the approach taken under these
                interim final rules, which seek to supplement, rather than supplant
                state balance billing laws. Specifically, the Departments considered
                whether to allow states to be more protective of consumers than the No
                Surprises Act with respect to whether individuals are permitted to
                waive balance billing protections upon notice and consent, and
                concluded that it is in the public interest to interpret the No
                Surprises Act as creating a floor regarding individuals' ability to
                waive balance billing protections. The Departments also considered
                whether state provisions allowing ERISA-covered plans to opt in to the
                state requirements should be considered specified state laws for
                purposes of setting the recognized amount and out-of-network rate
                regarding ERISA-covered plans that have opted into the state programs.
                The Departments have concluded such deference to state law is
                consistent with the overarching structure of the No Surprises Act. The
                Departments also considered allowing providers, facilities and
                providers of air ambulance services to opt in to state laws (as allowed
                under state laws), but decided to instead seek comments on this
                approach, as discussed earlier in this preamble.
                 Notice and Consent Exception to Prohibition on Balance Billing.
                Under the No Surprises Act and these interim final rules, the
                protections that limit cost sharing and prohibit balance billing do not
                apply to certain non-emergency services or to certain post-
                stabilization services provided in the context of emergency care, if
                the nonparticipating
                [[Page 36932]]
                provider or nonparticipating emergency facility furnishing those items
                or services provides the participant, beneficiary, or enrollee, with
                certain notice, the individual acknowledges receipt of the information
                in the notice, and the individual consents to be treated by the
                nonparticipating emergency facility or nonparticipating provider. These
                interim final rules establish the conditions under which notice and
                consent may be provided for certain non-emergency and post-
                stabilization services. The Departments considered a number of
                additional conditions under which the notice and consent exception
                would not be permitted, such as if the individual were experiencing
                pain, or under the influence of alcohol or drugs, including the use or
                administration of prescribed medications. The Departments are of the
                view that these factors are critical considerations for whether an
                individual is able to provide informed consent, and concluded that
                these are factors that a provider would be expected to assess when
                determining if the individual is capable of understanding the
                information provided in the notice and the implications of consenting.
                The HHS interim final rules therefore establish requirements related to
                the notice and consent exception. HHS considered a number of
                alternatives in developing these interim final rules. HHS considered
                different standards to apply in defining geographic regions for
                purposes of language access requirements. The HHS interim final rules
                require providers and facilities to provide the notice and consent
                documents in the 15 most common language in the state, or in a
                geographic region, which reasonably reflects the geographic region
                served by the applicable facility. HHS also considered the use of
                MSAs,\176\ hospital service areas (HSAs),\177\ hospital referral
                regions (HRRs),\178\ and public use microdata areas (PUMAs),\179\
                applied based on where the applicable facility is located. These
                geographic regions might better reflect a facility's service area than
                a state. However, HHS is of the view that allowing providers and
                facilities to use the state as the geographic region would reduce
                burden, and concluded that the standard in the HHS interim final rules
                provides sufficient flexibility for providers and facilities to
                determine how best to serve their population. HHS considered requiring
                that a provider or facility that uses a region other than a state must
                use a geographic region smaller than a state, but determined this
                approach would not adequately address the needs to facilities that
                serve populations that cross state borders. HHS also considered
                alternatives regarding the inapplicability of the notice and consent
                exception to ancillary services. HHS considered expanding the
                definition of ancillary services to include other services for which
                surprise billing frequently occurs. In particular, stakeholders raised
                concerns about providers who deliver services to individuals during
                inpatient stays, but who the individual has little involvement in
                selecting. These included, for example, providers furnishing mental
                health services, cardiology services, and rehabilitative services. The
                Departments are concerned about surprise bills that arise in these
                situations, but prefer to further consider the recommendation.
                Individuals may have strong preferences to select these types of
                providers for out-of-network care, and it is therefore not clear
                whether they would be appropriate to include among the types of
                specialties for which notice and consent to be balance billed is
                prohibited.
                ---------------------------------------------------------------------------
                 \176\ https://www.census.gov/programs-surveys/metro-micro/about.html.
                 \177\ https://www.dartmouthatlas.org/faq/.
                 \178\ https://www.dartmouthatlas.org/faq/.
                 \179\ https://www.census.gov/programs-surveys/geography/
                guidance/geo-areas/
                pumas.html#:~:text=Public%20Use%20Microdata%20Areas%20(PUMAs)%20are%2
                0non%2Doverlapping%2C,and%20the%20U.S.%20Virgin%20Islands.
                ---------------------------------------------------------------------------
                 Applicability date. The Departments considered delaying the
                applicability date of these interim final rules in response to
                stakeholder feedback regarding the challenges of coming into compliance
                with these interim final rules by January 1, 2022. The Departments
                recognize the challenges that providers (including providers of air
                ambulance services), facilities, plans, and issuers will face in making
                the necessary changes to comply with these new requirements. However,
                delaying the applicability date would have significant ramifications
                for participants, beneficiaries, and enrollees and would continue to
                leave them vulnerable to surprise bills. Therefore, the Departments
                concluded that it is in the public interest to require these interim
                final rules to be applicable in accordance with the applicability dates
                in the No Surprises Act.
                 Provider Disclosure Requirements Regarding Patient Protections
                against Balance Billing. Section 2799B-3 of the PHS Act, as added by
                the No Surprises Act, requires providers and facilities to provide
                disclosures regarding patient protections against balance billing.
                These interim final rules include provisions to limit this disclosure
                requirement to certain providers and facilities, and with respect to
                certain individuals. These interim final rules also include a special
                rule to limit unnecessary duplication, so that a facility's disclosure
                may satisfy the disclosure requirement on behalf of providers in
                certain circumstances. HHS considered applying the disclosure
                requirement more broadly. However, HHS determined that a broader
                application of the disclosure requirements would increase the
                administrative costs associated with the requirement, without
                commensurate benefits to individuals. Rather, HHS was concerned that
                requiring the disclosure be made by facilities and providers in
                circumstances where the protections against balance billing would not
                apply could create consumer confusion about their rights under the No
                Surprises Act. Additionally, HHS determined that requiring providers to
                provide a disclosure when furnishing services at a facility that was
                also required to provide a disclosure was unnecessary and could be
                overwhelming to consumers. If providers furnishing services at a
                facility were required to provide a disclosure as well, at the very
                least, the cost of printing and materials for the notices would have
                doubled, for an additional $2.5 million in costs. If, in addition,
                providers had to develop the notices they provided, there would have
                been additional costs. If all providers were required to provide a
                notice, regardless of whether the services are furnished at a
                provider's office or a health care facility, then in addition to the
                39,690,940 individuals treated in the emergency facilities,\180\
                526,685,200 individuals visiting a provider's office or a health care
                facility would have been provided a disclosure, for a total of
                566,376,140 disclosures.\181\ The cost to print the disclosures would
                have been approximately $28.3 million, approximately $25.8 million more
                than it is estimated to be under the provisions in these interim final
                rules.
                ---------------------------------------------------------------------------
                 \180\ Agency for Healthcare Research and Quality, HCUP Fast
                Stats--Trends in Emergency Department Visits. https://www.hcup-us.ahrq.gov/faststats/NationalTrendsEDServlet?measure1=01&characteristic1=14&measure2=&characteristic2=11&expansionInfoState=hide&dataTablesState=hide&definitionsState=hide&exportState=hide#export.
                 \181\ Estimates based on data on postoperative office visits.
                Centers for Disease Control, National Ambulatory Medical Care
                Survey: 2016 National Summary Tables. Available at https://www.cdc.gov/nchs/fastats/physician-visits.htm.
                ---------------------------------------------------------------------------
                [[Page 36933]]
                D. Paperwork Reduction Act--Department of Health and Human Services
                 Under the Paperwork Reduction Act of 1995 (PRA), HHS is required to
                provide 30-day notice in the Federal Register and solicit public
                comment before a collection of information requirement is submitted to
                OMB for review and approval. To fairly evaluate whether an information
                collection should be approved by OMB, section 3506(c)(2)(A) of the PRA
                requires that HHS solicit comment on the following issues:
                 The need for the information collection and its usefulness
                in carrying out the proper functions of our agency.
                 The accuracy of HHS' estimate of the information
                collection burden.
                 The quality, utility, and clarity of the information to be
                collected.
                 Recommendations to minimize the information collection
                burden on the affected public, including automated collection
                techniques.
                 HHS is soliciting public comment on each of the required issues
                under section 3506(c)(2)(A) of the PRA for the following information
                collection requirements (ICRs).
                1. Wage Estimates
                 To derive wage estimates, the Departments generally used data from
                the Bureau of Labor Statistics to derive average labor costs (including
                a 100 percent increase for fringe benefits and overhead) for estimating
                the burden associated with the ICRs.\182\ Table 4 presents the mean
                hourly wage, the cost of fringe benefits and overhead, and the adjusted
                hourly wage.
                ---------------------------------------------------------------------------
                 \182\ See May 2020 Bureau of Labor Statistics, Occupational
                Employment Statistics, National Occupational Employment and Wage
                Estimates, available at https://www.bls.gov/oes/current/oes_nat.htm.
                ---------------------------------------------------------------------------
                 As indicated, employee hourly wage estimates have been adjusted by
                a factor of 100 percent. This is necessarily a rough adjustment, both
                because fringe benefits and overhead costs vary significantly across
                employers, and because methods of estimating these costs vary widely
                across studies. Nonetheless, there is no practical alternative, and the
                Departments are of the view that doubling the hourly wage to estimate
                total cost is a reasonably accurate estimation method.
                 Table 4--Wage Rates
                ----------------------------------------------------------------------------------------------------------------
                 Fringe
                 Occupational Mean hourly benefits and Adjusted
                 Occupation title code wage ($/hour) overhead ($/ hourly wage ($/
                 hour) hour)
                ----------------------------------------------------------------------------------------------------------------
                Secretaries and Administrative Assistants, 43-6014 $19.43 $19.43 $38.86
                 Except Legal, Medical, and Executive...........
                Lawyer.......................................... 23-1011 71.59 71.59 143.18
                All Occupations................................. 00-0000 27.07 27.07 54.14
                Computer Programmers............................ 15-1251 45.98 45.98 91.96
                Medical Secretaries and Administrative 43-6013 18.75 18.75 37.50
                 Assistants.....................................
                Human Resources Specialists..................... 13-1071 33.38 33.38 66.76
                Business Operations Specialist.................. 13-1198 38.57 38.57 77.14
                General and Operations Manager.................. 11-1021 59.15 59.15 118.30
                Compensation and Benefits Manager............... 11-3111 65.94 65.94 131.88
                Computer and Information Systems Managers....... 11-3021 77.76 77.76 155.52
                ----------------------------------------------------------------------------------------------------------------
                2. ICRs Regarding Information To Be Shared About QPA (45 CFR
                149.140(d))
                 These interim final rules require plans and issuers to provide
                certain information regarding the QPA to nonparticipating providers, or
                nonparticipating emergency facilities in cases in which the recognized
                amount with respect to an item or service furnished by the provider or
                facility is the QPA (and in all cases subject to these rules for
                nonparticipating providers of air ambulance services). Specifically,
                plans and issuers must provide the following information to providers
                (including air ambulance providers) and facilities, when making an
                initial payment or notice of denial of payment: (1) The QPA for each
                item or service involved; (2) a statement certifying that the plan or
                issuer has determined that the QPA applies for the purposes of the
                recognized amount (or, in the case of air ambulance services, for
                calculating the participant's, beneficiary's, or enrollee's cost
                sharing), and each QPA was determined in compliance with the
                methodology established in these interim final rules; (3) a statement
                that if the provider or facility, as applicable, wishes to initiate a
                30-day open negotiation period for purposes of determining the amount
                of total payment, the provider or facility may contact the appropriate
                person or office to initiate open negotiation, and that if the 30-day
                negotiation period does not result in a determination, generally, the
                provider or facility may initiate the independent dispute resolution
                process within 4 days after the end of the open negotiation period; and
                (4) 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 such item or service. Additionally, upon
                request of the provider or facility, the plan or issuer must provide,
                in a timely manner, the following information: (1) Whether the QPA for
                items and services involved included contracted rates that were not on
                a fee-for-service basis for those specific items and services and
                whether the QPA for those items and services was determined using
                underlying fee schedule rates or a derived amount; (2) if a related
                service code was used to determine the QPA for a new service code,
                information to identify the related service code; (3) if the plan or
                issuer used an eligible database to determine the QPA, information to
                identify which database was used; and (4) if applicable, upon request,
                a statement that the plan's or issuer's contracted rates include risk-
                sharing, bonus, or other incentive-based or retrospective payments or
                payment adjustments for covered items and services that were excluded
                for purposes of calculating the QPA.
                 The Departments assume that TPAs will provide this information on
                behalf of self-insured plans. In addition, the Departments assume that
                issuers and TPAs will automate the process of preparing and providing
                this information in a format similar to an explanation of benefits as
                part of the system to calculate the QPA. The cost to issuers and TPAs
                of making the changes
                [[Page 36934]]
                to their IT systems is discussed previously in the RIA.
                 The Departments estimate that a total of 1,758 issuers and TPAs
                will incur burden to comply with this provision. Currently, 14 states
                have established some payment standards for services provided by
                nonparticipating providers or nonparticipating emergency facilities.
                Therefore, the Departments assume that issuers and TPAs will
                potentially need to calculate the QPA for two-thirds of the claims
                involving nonparticipating providers or nonparticipating emergency
                facilities.
                 In 2018, there were approximately 39,690,940 emergency department
                visits for patients with individual market or group health
                coverage.\183\ The Departments estimate that approximately 18 percent
                of these visits \184\ will include services provided by
                nonparticipating providers or nonparticipating emergency facilities and
                plans and issuers will need to calculate the QPA for two-thirds of such
                claims. Therefore, plans and issuers will be required to provide the
                specified information along with the initial payment or denial notice
                for approximately 4,786,727 claims annually from nonparticipating
                providers or nonparticipating emergency facilities for emergency
                department visits. In addition, in 2018, there were approximately
                4,146,476 emergency department visits that resulted in hospital
                admission for patients with individual market or group health coverage.
                Using this as an estimate of post-stabilization services provided in
                emergency facilities, and assuming that in 16 percent of cases the
                patient is treated at a nonparticipating emergency facility or by a
                nonparticipating provider at a participating facility,\185\ the
                Departments estimate that approximately 663,436 individuals will have
                the potential to be treated by a nonparticipating provider or facility.
                In the absence of data, the Departments assume that in 50 percent of
                cases services will be provided by nonparticipating providers without
                satisfying the notice and consent criteria in these interim final rules
                for reasons such as unforeseen, urgent medical needs and lack of
                participating providers in the facility. The Departments estimate that
                plans and issuers will need to calculate the QPA for two-thirds of such
                claims. Therefore, plans and issuers will be required to provide the
                required information along with the initial payment or denial notice
                for approximately 222,251 claims from nonparticipating providers or
                nonparticipating emergency facilities for post-stabilization services.
                Additionally, based on 2016 data, the Departments estimate that there
                will be 11,107,056 visits to health care facilities annually for
                surgical and non-surgical procedures for individuals with group health
                coverage or individual market coverage.\186\ The Departments assume
                that in 16 percent of cases the patient will have the potential to
                receive care from a nonparticipating provider at a participating
                facility, and that in approximately 5 percent of those cases services
                will be provided by nonparticipating providers without satisfying the
                notice and consent criteria in these interim final rules for reasons
                such as the services being ancillary services or related to unforeseen,
                urgent medical needs, and plans and issuers will need to calculate the
                QPA for two-thirds of such claims. Therefore, plans and issuers will be
                required to provide the required information along with the initial
                payment or denial notice for approximately 59,534 claims annually for
                non-emergency services furnished by a nonparticipating provider at a
                participating health care facility. In total, plans and issuers will be
                required to provide documents related to QPAs along with the initial
                payment or denial of payment for approximately 5,068,512 claims
                annually from nonparticipating providers or facilities.
                ---------------------------------------------------------------------------
                 \183\ Agency for Healthcare Research and Quality, HCUP Fast
                Stats--Trends in Emergency Department Visits. https://www.hcup-us.ahrq.gov/faststats/NationalTrendsEDServlet?measure1=01&characteristic1=14&measure2=&characteristic2=11&expansionInfoState=hide&dataTablesState=hide&definitionsState=hide&exportState=hide.
                 \184\ Estimate from Pollitz, K. et al., Surprise Bills Vary by
                Diagnosis and Type of Admission, Peterson-KFF Health System tracker,
                December 9, 2019, https://www.healthsystemtracker.org/brief/surprise-bills-vary-by-diagnosis-and-type-of-admission/.
                 \185\ Estimate from Pollitz, K. et al., Surprise Bills Vary by
                Diagnosis and Type of Admission, Peterson-KFF Health System tracker,
                December 9, 2019, https://www.healthsystemtracker.org/brief/surprise-bills-vary-by-diagnosis-and-type-of-admission/.
                 \186\ Estimates based on data on postoperative office visits.
                Centers for Disease Control, National Ambulatory Medical Care
                Survey: 2016 National Summary Tables. Available at https://www.cdc.gov/nchs/fastats/physician-visits.htm.
                ---------------------------------------------------------------------------
                 The Departments estimate that for each issuer or TPA it will take a
                medical secretary 10 minutes (at an hourly rate of $37.50) to prepare
                the documentation and attach it to each payment or denial notice or
                explanation of benefits sent to the nonparticipating provider or
                facility. The Departments assume that this information will be sent
                electronically at minimal cost. The total annual burden for all issuers
                and TPAs to provide the QPA information and certification along with
                5,068,512 payments or denial notices, is estimated to be approximately
                844,752 hours, with an associated equivalent cost of approximately
                $31.7 million.
                 The Departments assume that for the 5,068,512 QPA information sent
                to nonparticipating providers or nonparticipating emergency facilities,
                50 percent will result in requests to provide additional information
                and plans and issuers will be required to send additional information
                to approximately 2,534,256 providers or facilities. The Departments
                estimate that it will take a medical secretary 15 minutes (at an hourly
                rate of $37.50) to prepare the document and provide it to the provider
                or facility that requested it. The Departments assume that this
                information will be delivered electronically with minimal additional
                cost. The total estimated burden, for all issuers and TPAs, will be
                approximately 633,564 hours annually, with an associated equivalent
                cost of approximately $23.8 million.
                 The total annual burden for all issuers and TPAs for providing the
                initial and additional information related to QPA will be 1,478,316
                hours, with an equivalent cost of $55,436,853. As DOL, the Treasury
                Department and HHS share jurisdiction, HHS will account for 50 percent
                of the burden, or approximately 739,158 burden hours with an equivalent
                cost of approximately $27,718,427. The Departments seek comment on
                these burden estimates.
                [[Page 36935]]
                 Table 5--Annual Burden and Cost for Plans and Issuers To Provide Information Related to QPA to Nonparticipating
                 Providers and Nonparticipating Emergency Facilities
                ----------------------------------------------------------------------------------------------------------------
                 Estimated Estimated Burden per
                 number of number of response Total annual Total estimated
                 respondents responses (hours) burden (hours) cost
                ----------------------------------------------------------------------------------------------------------------
                Initial information......... 879 2,534,256 0.167 422,376 $15,839,100.93
                Additional Information...... 879 1,267,128 0.25 316,782 11,879,325.70
                 -----------------------------------------------------------------------------------
                 Total................... 879 3,801,384 .............. 739,158 27,718,427.63
                ----------------------------------------------------------------------------------------------------------------
                3. ICRs Regarding Audits of QPA (45 CFR 149.140(f))
                 The No Surprises Act provides that rulemaking must establish a
                process under which group health plans and health insurance issuers
                offering group or individual health insurance coverage are audited by
                the applicable Secretary or applicable state authority to ensure that
                such plans and coverage are in compliance with the requirement of
                applying a QPA and that the QPA applied satisfies the definition under
                the No Surprises Act with respect to the year involved.
                 These interim final rules include an audit provision establishing
                that the Departments' existing enforcement procedures will apply with
                respect to ensuring that a plan or coverage is in compliance with the
                requirement of determining and applying a QPA consistent with these
                interim final rules.
                 HHS has primary enforcement authority over issuers (in a state if
                the Secretary of HHS makes a determination that a state is failing to
                substantially enforce a provision (or provisions) of Part A or D of
                title XXVII of the PHS Act) and non-federal governmental plans, such as
                those sponsored by state and local government employers and expects to
                conduct no more than 9 audits annually. Therefore, this collection is
                exempt from the PRA under 44 U.S.C. 3502(3)(A)(i).
                4. ICRs Regarding Disclosure for Self-Insured Plans Opting-In to State
                Law (45 CFR 149.30)
                 These interim final rules allow self-insured group health plans,
                including self-insured non-federal governmental plans, to voluntarily
                opt in to state law that provides for a method for determining the
                cost-sharing amount or total amount payable under such a plan, where a
                state has chosen to expand access to such plans, to satisfy their
                obligations under section 9816(a)-(d) of the Code, section 716(a)-(d)
                of ERISA, and section 2799A-1(a)-(d) of the PHS Act. A self-insured
                plan that has chosen to opt-in to a state law must prominently display
                in its plan materials describing the coverage of out-of-network
                services a statement that the plan has opted in to a specified state
                law, identify the relevant state (or states), and include a general
                description of the items and services provided by nonparticipating
                facilities and providers that are covered by the specified state law.
                 Based on available data, HHS estimates that approximately 84 self-
                insured non-federal governmental plans in New Jersey, Nevada, Virginia
                and Washington \187\ will opt-in and incur the one-time burden and cost
                to include the disclosure in their plan documents in 2022. It is
                estimated that for each plan an administrative assistant will spend 1
                hour (at an hourly rate of $38.86) and a compensation and benefits
                manager will spend 30 minutes (at an hourly rate of $131.88) to prepare
                the disclosure. The estimated total burden for each plan will be 1.5
                hours with an equivalent cost of approximately $105. The estimated
                total annual burden for all 84 plans will be approximately 126 hours
                with an equivalent cost of approximately $8,783. HHS estimates that
                there are approximately 11,956 policyholders in these plans that will
                be provided the disclosure. HHS assumes that only printing and material
                costs are associated with the disclosure requirement, because the
                notice can be incorporated into existing plan documents. HHS estimates
                that the disclosure will require one-half of a page, at a cost of $0.05
                per page for printing and materials, and 34 percent of plan documents
                will be delivered electronically at minimal cost.\188\ Therefore, the
                cost to deliver 66 percent of these disclosures in print is estimated
                to be approximately $197. The total one-time cost for all plans,
                incurred in 2022, is estimated to be approximately $8,981.
                ---------------------------------------------------------------------------
                 \187\ Based on data on self-insured plans that have opted in
                available at: https://www.insurance.wa.gov/self-funded-group-health-plans, https://www.dol.gov/sites/dolgov/files/EBSA/researchers/data/health-and-welfare/health-insurance-coverage-bulletin-2019.pdf,
                https://scc.virginia.gov/balancebilling.
                 \188\ According to data from the National Telecommunications and
                Information Agency, 34 percent of households in the United States
                accessed health records or health insurance online. https://www.ntia.doc.gov/blog/2020/more-half-american-households-used-internet-health-related-activities-2019-ntia-data-show.
                 Table 6--One-Time Burden and Cost To Provide Disclosure Regarding Opting in to State Law
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Estimated Estimated Burden per Total estimated
                 Year number of number of response Total annual Total estimated printing and Total estimated
                 respondents responses (hours) burden (hours) labor cost materials cost cost
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                2022............................. 84 84 1.5 126 $8,783 $197 $8,981
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                5. ICRs Regarding Complaints Process for Surprise Medical Bills (45 CFR
                149.150, 45 CFR 149.450)
                 The No Surprises Act directs the Departments to establish a process
                to receive complaints regarding violations of the application of the
                QPA requirements by group health plans and health insurance issuers
                offering group or individual health coverage under section
                9816(a)(2)(B)(iv) of the Code, section 716(a)(2)(B)(iv) of ERISA, and
                section 2799A-1(a)(2)(B)(iv) of the PHS Act, and violations by health
                care provider, facilities, and providers of air
                [[Page 36936]]
                ambulance services of the requirements under sections 2799B-1, 2799B-2,
                2799B-3, and 2799B-5 of the PHS Act. The Departments are of the view
                that the complaints process should extend to all of the balance billing
                requirements and define a complainant as any individual, or their
                authorized representative, who files a complaint, as described and
                defined in these interim final rules. This regulatory action is taken
                as required by the No Surprises Act, which directs the Departments to
                create a process for balance billing complaints regarding plans and
                issuers, and directs HHS to create a process for balance billing
                complaints regarding providers and facilities.
                 HHS estimates that there will be, on average, 3,600 balance billing
                complaints against providers, facilities, providers of air ambulance
                services, plans, and issuers submitted annually. HHS estimates that it
                will take each complainant 30 minutes (at an hourly rate of $54.14)
                \189\ to collect all relevant documentation related to the alleged
                violation and to access and complete the provided complaint form, with
                an equivalent cost of approximately $27. The total burden for all
                complainants is estimated to be 1,800 hours, with an equivalent annual
                cost of approximately $97,452. As DOL, the Treasury Department and HHS
                share jurisdiction, HHS will account for 50 percent of the burden,
                approximately 900 burden hours with an equivalent cost of approximately
                $48,726.
                ---------------------------------------------------------------------------
                 \189\ The Departments use the average wage rate for all
                occupations.
                 Table 7--Annual Burden and Costs for Complaints Related to Surprise Billing
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Estimated Burden per
                 Estimated number of respondents number of response Cost per Total annual Total estimated
                 responses (hours) response burden (hours) cost
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                1,800.............................................................. 1,800 0.5 $27.07 900 $48,726
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                6. ICRs Regarding Notice of Right To Designate a Primary Care Provider
                (45 CFR 149.310(a)(4))
                 These interim final rules continue to require that if a group
                health plan or health insurance issuer requires the designation by a
                participant, beneficiary, or enrollee of a primary care provider, the
                plan or issuer must provide a notice informing each participant (in the
                individual market, primary subscriber) of the terms of the plan or
                coverage and their right to designate a primary care provider. For
                group health plans and group health insurance coverage, the notice must
                be included whenever the plan or issuer provides a participant with a
                summary plan description or other similar description of benefits under
                the plan or coverage. For individual health insurance coverage, the
                notice must be included whenever the issuer provides a primary
                subscriber with a policy, certificate, or contract of health insurance.
                These interim final rules continue to include model language to satisfy
                the notice requirements. The No Surprises Act extends the applicability
                of the patient protections for choice of health care professionals to
                grandfathered health plans. The patient protections under section 2719A
                of the PHS Act apply to only non-grandfathered group health plans and
                health insurance issuers offering non-grandfathered group or individual
                health insurance coverage. In contrast, the patient protections under
                the No Surprises Act apply generally to all group health plans and
                group and individual health insurance coverage, including grandfathered
                health plans. Therefore, the requirements regarding patient protections
                for choice of health care professional under these interim final rules
                will newly apply to grandfathered health plans for plan years beginning
                on or after January 1, 2022.
                 In order to satisfy the patient protection disclosure requirement,
                state and local government plans and issuers in the individual market
                will need to notify policy holders of their plans' policy in regards to
                designating a primary care physician and for obstetrical or
                gynecological visits and will incur a one-time burden and cost to
                incorporate the notice into plan documents. Non-federal governmental
                plans and individual market plans that are currently not grandfathered
                have already incurred the one-time cost to prepare and incorporate this
                notice in their existing plan documents.
                 There are an estimated 90,126 non-federal governmental employers
                offering health plans to employees and 388 health insurance issuers in
                the individual market. HHS estimates that there are approximately
                14,417 grandfathered non-federal government employer-sponsored plans
                and approximately 837,543 grandfathered individual market policies,
                with approximately 6,055 grandfathered non-federal governmental plans
                offering HMO and point-of-service (POS) options.\190\ HHS assumes that
                all individual market issuers offer at least one HMO, exclusive
                provider organization (EPO) or POS options.
                ---------------------------------------------------------------------------
                 \190\ According to 2020 Kaiser/HRET survey of Employer Health
                Benefits, 11 percent of employers offer a health maintenance
                organization (HMO) option and that 31 percent of employers offer a
                point-of-service (POS) option. Available at https://www.kff.org/health-costs/report/2020-employer-health-benefits-survey/.
                ---------------------------------------------------------------------------
                 It is estimated that in 2022, 5,450 grandfathered non-federal
                governmental plans and individual market policies will be subject to
                this notice requirement. While not all HMO, EPO, and POS options
                require the designation of a primary care physician or a prior
                authorization or referral before an OB/GYN visit, HHS is unable to
                estimate this number. Therefore, this estimate should be considered an
                overestimate of the number of affected entities.
                 These interim final rules continue to provide model language for
                the notice. It is estimated that each plan or issuer will require a
                compensation and benefits manager (at an hourly rate of $131.88) to
                spend 10 minutes customizing the model notice to fit the plan's
                specifications. Each plan or issuer will also require clerical staff
                (at an hourly rate of $38.86) to spend 5 minutes adding the notice to
                the plan's documents. The estimated total burden for each plan or
                issuer will be 0.25 hours with an equivalent cost of approximately $25.
                In 2022, the estimated total annual burden for all 5,450 plans and
                issuers will be approximately 1,362 hours with an equivalent cost of
                approximately $137,430. There will be no additional burden and cost in
                2023 to prepare the notice, since all plans and issuers will have
                incurred the burden and cost by 2022.
                 HHS estimates that there are approximately 1.8 million non-federal
                governmental plan policyholders in grandfathered plans, with an
                estimated
                [[Page 36937]]
                413,976 policyholders enrolled in grandfathered HMO and POS plans
                options.\191\ In addition, there are an estimated 837,543 policyholders
                with grandfathered individual market plans. It is estimated that
                approximately 75 percent of individual market enrollees are enrolled in
                HMO, EPO, and POS options.\192\ Therefore, an estimated 627,146
                policyholders in the individual market have grandfathered plans with
                HMO, EPO, and POS options. It is estimated that approximately 937,010
                policyholders will remain in grandfathered non-federal government
                employer sponsored and individual market plans with HMO, EPO, and POS
                options in 2022 and will receive the required notice for the first time
                in 2022. HHS assumes that only printing and material costs are
                associated with the disclosure requirement, because the notice can be
                incorporated into existing plan documents. HHS estimates that the
                notice will require one-half of a page, at a cost of $0.05 per page for
                printing and materials, and 34 percent of the notices will be delivered
                electronically at minimal cost.\193\ Therefore, the cost to deliver 66
                percent of these notices in print is estimated to be approximately
                $15,461.\194\
                ---------------------------------------------------------------------------
                 \191\ According to the 2020 Kaiser/HRET Survey of Employer
                Sponsored Health Benefits, 12 percent of covered workers in non-
                federal government plans have an HMO option and that 11 percent of
                covered workers have a POS option.
                 \192\ Estimate based of data reported in Unified Review Template
                Submissions for 2018 plan. Rate review data available at https://www.cms.gov/CCIIO/Resources/Data-Resources/ratereview.html.
                 \193\ According to data from the National Telecommunications and
                Information Agency, 34 percent of households in the United States
                accessed health records or health insurance online. https://www.ntia.doc.gov/blog/2020/more-half-american-households-used-internet-health-related-activities-2019-ntia-data-show.
                 \194\ 937,010 notices x 66% = 618,427 notices printed x $0.05
                per page x \1/2\ pages per notice = approximately $15,461.
                 Table 8--One-Time Burden and Cost To Provide Notice of Right To Designate a Primary Care Provider
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Estimated Estimated Burden per Total estimated
                 Year number of number of response Total annual Total estimated printing and Total estimated
                 respondents responses (hours) burden (hours) labor cost materials cost cost
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                2022............................. 5,450 5,450 0.25 1,362 $137,430 $15,461 $152,891
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 HHS will revise the burden currently approved under OMB Control
                Number 0938-1094, (Notice of Rescission of Coverage and Disclosure
                Requirements for Patient Protection under the Affordable Care Act, CMS-
                10330, expiration: July 31, 2022) to account for this burden.
                7. ICRs Regarding Notice and Consent To Waive Balance Billing
                Protections, Retention of Certain Documents, and Notice to Plan or
                Issuer (45 CFR 149.410(b)-(e), 45 CFR 149.420(c)-(i))
                 The No Surprises Act and these interim final rules require that a
                plan or issuer providing coverage of emergency services do so without
                the individual or the health care provider having to obtain prior
                authorization and without regard to whether the health care provider
                furnishing the emergency services is a participating provider or a
                participating emergency facility with respect to the services
                (regardless of the department of the hospital in which such items and
                services are furnished). Emergency services include any additional
                items and services that are covered under a plan or coverage after a
                participant, beneficiary, or enrollee is stabilized (referred to as
                post-stabilization services) unless certain notice and consent
                requirements are met. The No Surprises Act and these interim final
                rules further apply surprise billing protections in the case of non-
                emergency services furnished by nonparticipating providers during a
                visit by a participant, beneficiary, or enrollee at participating
                health care facilities unless notice and consent as specified in these
                interim final rules have been met. The requirements related to the
                notice and consent, applicable exceptions, and timing are set forth in
                section 2799B-2 of the PHS Act, and implemented at 45 CFR 149.410 and
                45 CFR 149.420 of these interim final rules.
                 In order to meet the notice and consent requirements of these
                interim final rules, nonparticipating providers and nonparticipating
                emergency facilities must provide the participant, beneficiary, or
                enrollee with a notice, meet certain timing requirements, and obtain
                consent from the participant, beneficiary, or enrollee as described in
                45 CFR 149.420 and these interim final rules. The provided notice must:
                (1) State the health care provider or facility is a nonparticipating
                provider or facility; (2) include the good faith estimate of what the
                individual may be charged, including any item or service that is
                reasonably expected to be provided in conjunction with such items and
                services; (3) provide information about whether prior authorization or
                other care management limitations may be required; and (4) clearly
                state that consent to receive such items or services is optional and
                that the participant, beneficiary, or enrollee may instead seek care
                from an available participating provider, in which case the
                individual's cost-sharing responsibility would be at the in-network
                level. In cases where post-stabilization services are furnished by a
                nonparticipating provider at a participating emergency facility, the
                notice must also include a list of participating providers at the
                participating emergency facility who are able to furnish the items or
                services involved and inform the individual that they may be referred,
                at their option, to such a participating provider. Additionally, a
                nonparticipating provider or nonparticipating emergency facility must
                provide the participant, beneficiary, or enrollee, or such individual's
                authorized representative, with the notice and consent documents in any
                of the 15 most common languages in the state, or a geographic region
                that reasonably reflects the geographic region served by the applicable
                facility. If the individual's preferred language is not among the 15
                most common languages made available or the individual cannot
                understand the language in which the notice and consent document are
                provided the individual must be provided with a qualified interpreter.
                 In addition to providing the required notice and consent,
                nonparticipating emergency facilities, participating health care
                facilities, and nonparticipating providers are obligated to retain
                written notice and consent documents for at least a 7-year period after
                the date on which the item or service in question was furnished. Where
                the notice and consent requirements described in this interim final
                rule have been met, the
                [[Page 36938]]
                nonparticipating provider, the participating health care facility on
                behalf of the nonparticipating provider, or the nonparticipating
                emergency facility, as applicable, must timely notify the plan or
                issuer, respectively, that the notice and consent criteria have been
                met, and if applicable, provide to the plan or issuer a copy of the
                signed notice and consent documents. In instances where, to the extent
                permitted by these rules, the nonparticipating provider bills the
                participant, beneficiary, or enrollee directly, the provider may
                satisfy the requirement to notify the plan or issuer by including the
                notice and consent documents with the bill to the participant,
                beneficiary, or enrollee. In addition, for items and services furnished
                by a nonparticipating provider at a participating health care facility,
                the provider (or the participating facility on behalf of the provider)
                must timely notify the plan or issuer that the item or service was
                furnished during a visit at a participating health care facility.
                 In order to meet the notice and consent requirements of the statute
                and these interim final rules, nonparticipating providers and
                nonparticipating emergency facilities must provide the participant,
                beneficiary, or enrollee with a notice. HHS is specifying in guidance
                mandatory notice and consent forms that will require customization by
                the provider or facility.
                 HHS assumes that emergency facilities and health care facilities
                will provide the notice and obtain consent on behalf of
                nonparticipating providers, retain records and notify plans and
                issuers. HHS estimates that a total of 17,467 health care facilities
                and emergency departments (including 475 hospital-affiliated satellite
                and 270 independent freestanding emergency departments) will be subject
                to these requirements. HHS assumes that for hospital-affiliated
                satellite freestanding emergency departments, the notice and consent
                will be developed by the parent hospital. Therefore, the burden to
                develop the notice and consent documents will be incurred by 16,992
                emergency facilities and health care facilities. HHS estimates that for
                each facility it will take a lawyer 1 hour (at an hourly rate of
                $143.18) to read and understand the notice and consent forms and make
                any required and applicable alteration, an administrative assistant
                half an hour (at an hourly rate of $38.86) to make any alterations to
                the provided notice and consent documents and prepare the final
                documentation, a computer programmer 1 hour (at an hourly rate of
                $91.96) to digitize and post on a shared network server or push to
                networked computers fillable versions of the notice and consent
                documents, and a Computer and Information Systems Manager half an hour
                (at an hourly rate of $155.52) to verify accessibility to, and ensure
                functionality of, the notice and consent documents. HHS also estimates
                each facility will incur an additional cost of approximately $1,000 (at
                $500 per document) to contract with an outside firm to translate the
                notice and consent documents into the 15 most common languages in the
                state or a geographic region that reasonably reflects the geographic
                region served by the applicable facility. HHS estimates the one-time
                first-year burden, to be incurred in 2021, to make alterations, prepare
                the final versions, translate and make accessible to the providers
                within the facility the notice and consent documentation, for each
                facility will be approximately 3 hours, with an associated equivalent
                cost of approximately $1,332. For all 16,992 emergency facilities and
                health care facilities, HHS estimates a total one-time first-year
                burden of 50,976 hours, with an associated equivalent cost of
                approximately $22.6 million.
                 In order to meet the notice and consent requirements of 45 CFR
                149.420 with respect to post-stabilization services, when emergency
                services are provided by nonparticipating providers or nonparticipating
                emergency facilities, the provider or facility must provide the
                participant, beneficiary, or enrollee with a notice and obtain consent
                to be treated by the nonparticipating emergency facility or
                nonparticipating provider. HHS estimates there are approximately 5,533
                emergency departments (including hospital-affiliated satellite and
                independent freestanding emergency departments) \195\ that could be
                subject to the notice and consent requirements in these interim final
                rules and will incur ongoing annual costs and burdens, beginning in
                2022. In 2018, there were approximately 4,146,476 emergency department
                visits that resulted in hospital admission for patients with individual
                market or group health coverage.\196\ Using this as an estimate of
                post-stabilization services provided in emergency facilities, and
                assuming that in 16 percent of cases the patient is treated at a
                nonparticipating emergency facility or by a nonparticipating provider
                at a participating facility, HHS estimates that approximately 663,436
                individuals will be provided with a notice and consent document for
                post-stabilization services. HHS anticipates that the notice and
                consent will be used infrequently for post-stabilization services, so
                this estimate is an upper bound. HHS estimates it will take a medical
                secretary 2 hours (at an hourly rate of $37.50) to customize the
                required notice and consent documents, generate a list of participating
                providers, provide and explain the documents to the individual (or
                authorized representative), answer questions, and obtain the signed
                consent if the individual agrees, provide the signed documents on paper
                or, as practicable, electronically, as selected by the individual, and
                retain the documentation as required by these interim final rules. The
                total burden for providing the notice and consent documents to
                individuals at all emergency facilities will be 1,326,872 hours with an
                equivalent cost of approximately $49.8 million. HHS assumes that these
                documents will be provided directly to each affected individual (or
                authorized representative) in paper format and will be 4 pages (2 pages
                printed double-sided) on average. Assuming a cost of $0.10 (at $0.05
                per page for printing and material cost) for each notice and consent
                document, the total printing and material costs for all notices will be
                approximately $66,344. The total ongoing cost for all emergency
                facilities will be approximately $49.8 million annually. HHS assumes
                that nonparticipating providers and nonparticipating emergency
                facilities will notify the plan or issuer and provide a copy of the
                signed notice and consent documents along with the claim form
                electronically at minimal cost.
                ---------------------------------------------------------------------------
                 \195\ Emergency Medicine Network, 2018 National Emergency
                Department Inventory--USA. Available at https://www.emnet-usa.org/research/studies/nedi/nedi2018/.
                 \196\ Agency for Healthcare Research and Quality, HCUP Fast
                Stats--Trends in Emergency Department Visits. Available at https://www.hcup-us.ahrq.gov/faststats/NationalTrendsEDServlet?measure1=01&characteristic1=14&measure2=&characteristic2=11&expansionInfoState=hide&dataTablesState=hide&definitionsState=hide&exportState=hide.
                ---------------------------------------------------------------------------
                 HHS estimates that each individual that receives notice and consent
                from an emergency facility will require, on average, 45 minutes (at an
                hourly rate of $54.14) to read and understand and sign the required
                notice and consent documents, with a total cost of approximately $41.
                For all 663,436 individuals that could potentially receive the notice
                and consent documents, HHS estimates a total annual burden of 497,577
                hours, with an associated total annual cost of approximately $26.9
                million.
                 In order to meet the notice and consent requirements of 45 CFR
                149.420 with respect to non-emergency services
                [[Page 36939]]
                furnished by a nonparticipating provider at a participating health care
                facility, if an individual schedules an appointment for such items or
                services at least 72 hours before the date of the appointment, the
                provider or facility must provide the notice to the individual, or
                their authorized representative, no later than 72 hours before the date
                of the appointment. If an individual schedules an appointment for such
                items or services within 72 hours of the date of the appointment, the
                provider or facility must provide the notice to the individual, or
                their authorized representative, on the day that the appointment is
                made. In the situation where an individual is provided the notice on
                the same day that the items or services are furnished, providers and
                facilities are required to provide the notice no later than 3 hours
                prior to furnishing items or services to which the notice and consent
                requirements applies.
                 HHS estimates there are approximately 16,722 health care facilities
                that will be subject to the notice requirement described in these
                interim final rules and will incur ongoing annual costs and burdens
                beginning in 2022. Based on 2016 data, HHS estimates that there will be
                11,107,056 visits to health care facilities annually for surgical and
                non-surgical procedures for individuals with group health coverage or
                individual market coverage \197\ and that approximately 16 percent of
                those visits will involve a nonparticipating provider.\198\ This
                estimate is a lower bound since it is based on the number of
                postoperative office visits and potentially excludes situations where
                such visits were not needed or such follow-up was conducted at a
                different setting. HHS therefore estimates that approximately 1,777,129
                individuals could potentially face balance billing and will be subject
                to the notice requirements of these interim final rules. With respect
                to non-emergency services furnished by a nonparticipating provider at a
                participating health care facility, HHS estimates it will take a
                medical secretary 1 hour (at an hourly rate of $37.50) to customize the
                required notice, generate a list of participating providers, provide
                the document via email or mail, as selected by the individual, and
                answer any questions. For all health care facilities, HHS estimates a
                total annual ongoing annual burden of approximately 1,777,129 hours,
                with an associated annual cost of approximately $66.6 million. HHS
                estimates that approximately 66 percent of the notices will be mailed
                to individuals (34 percent sent electronically) at a cost of $0.65 (at
                $0.05 per page for printing and material cost and $0.55 postage).\199\
                Assuming minimal cost for electronic delivery, the total cost of
                printing and mailing the notice and consent documents will be
                approximately $762,388 annually. The total ongoing cost for all health
                care facilities will be approximately $67.4 million annually.
                ---------------------------------------------------------------------------
                 \197\ Estimates based on data on postoperative office visits.
                Centers for Disease Control, National Ambulatory Medical Care
                Survey: 2016 National Summary Tables. Available at https://www.cdc.gov/nchs/fastats/physician-visits.htm.
                 \198\ Estimated based on information provided by KFF. Available
                at: https://www.kff.org/health-costs/poll-finding/data-note-public-worries-about-and-experience-with-surprise-medical-bills/.
                 \199\ According to data from the National Telecommunications and
                Information Agency, 34 percent of households in the United States
                accessed health records or health insurance online. https://www.ntia.doc.gov/blog/2020/more-half-american-households-used-internet-health-related-activities-2019-ntia-data-show.
                ---------------------------------------------------------------------------
                 HHS estimates that each individual that receives the notice will
                require, on average, 45 minutes (at an hourly rate of $54.14) to read
                and understand the required notice, with a total cost of $41. For all
                1,777,129 individuals that could receive the notice document, HHS
                estimates a total annual burden of 1,332,847 hours, with an associated
                total annual cost of $72.2 million. HHS assumes that nonparticipating
                providers (or the participating facilities on behalf of the providers)
                will notify the plan or issuer and provide a copy of the signed notice
                and consent documents along with the claim from the participating
                facility electronically at minimal cost.
                 For all emergency and health care facilities, the total ongoing
                burden will be 3,104,001 hours annually and the total cost, including
                printing and materials cost, will be approximately $117,228,780
                annually starting in 2022. For all consumers, the total annual burden
                to read and understand the notice will be 1,830,424 hours with an
                equivalent cost of $99,099,147 starting in 2022.
                 Table 9--One-Time and Annual Burden and Cost for Emergency Departments and Facilities Related to Notice and Consent
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Total
                 Estimated Estimated Total estimated
                 Year number of number of Total annual estimated translating, Total
                 respondents responses burden (hours) labor cost printing and estimated cost
                 materials cost
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                2021.................................................... 16,992 16,992 50,976 $5,646,951 $16,992,000 $22,638,951
                2022.................................................... 17,467 2,440,565 3,104,001 116,400,048 828,732 117,228,780
                2023.................................................... 17,467 2,440,565 3,104,001 116,400,048 828,732 117,228,780
                 183,634
                3 Year Average.......................................... 17,309 1,632,707 2,086,326 79,482,349 6,216,488 85,698,837
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Table 10--Annual Burden and Cost for Individuals Related to Notice and Consent Starting in 2022
                ----------------------------------------------------------------------------------------------------------------
                 Estimated number of Estimated number of Total annual burden Total estimated labor
                 respondents responses (hours) cost Total estimated cost
                ----------------------------------------------------------------------------------------------------------------
                 2,440,565 2,440,565 1,830,424 $99,099,147 $99,099,147
                ----------------------------------------------------------------------------------------------------------------
                [[Page 36940]]
                8. ICRs Regarding Provider Disclosure on Patient Protections Against
                Balance Billing (45 CFR 149.430)
                 Section 2799B-3 of the PHS Act, as added by the No Surprises Act
                and codified at 45 CFR 149.430, requires providers and facilities to
                provide disclosures regarding patient protections against balance
                billing. Specifically, health care providers and facilities (including
                an emergency department of a hospital or independent freestanding
                emergency department) are required to make publicly available, post on
                a public website of the provider or facility, and provide to
                participants, beneficiaries, and enrollees a one-page notice about
                surprise billing protections, which must include information about any
                applicable state requirements, and about how to contact appropriate
                state and federal agencies if the individual believes the provider or
                facility has violated the balance billing rules. The required notice
                must include clear and understandable language that explains the
                requirements and prohibitions relating to the prohibitions on balance
                billing in cases of emergency services and in cases of non-emergency
                services performed by a nonparticipating provider at certain
                participating facilities, explain any other applicable state laws, and
                provide contact information for the appropriate state and federal
                agencies that an individual may contact if they believe the provider or
                facility has violated a requirement described in the notice.
                 Health care providers and facilities are required to publicly post
                and make the disclosure publicly available through a public website
                accessible free of charge that is easily accessible, without barriers,
                including via search engines, and that ensures that the information is
                accessible to the general public. HHS assumes that providers and
                facilities will enter into agreements for the facilities to provide the
                disclosure on behalf of the providers and that the required language
                and information will be developed, posted within the facility, and
                posted on a public website by the facility. This will ameliorate the
                burden and cost for the individual provider. Many facilities and
                providers will be able to enter into an agreement at minimal cost if
                they renew their contracts prior to 2022. For each facility whose
                contracts with providers are not due to be renewed before 2022, the
                burden to enter into agreements related to this disclosure will vary
                based on the number of providers that practice within the facility. HHS
                estimates that for each facility, on average, it will take a lawyer 2
                hours (at an hourly rate of $143.18) to draft an agreement and an
                administrative assistant 2 hours (at an hourly rate of $38.86) to
                provide electronic copies to all providers to sign. The total burden
                for all 17,467 facilities will be 69,868 hours with an equivalent cost
                of approximately $6,359,385, to be incurred as one-time costs in 2021.
                HHS is unable to estimate how many providers will incur burden to sign
                the agreement, but anticipates that the burden to sign each agreement
                will be minimal. In future years, this agreement can be included in the
                contract between the facilities and providers at no additional cost.
                 HHS estimates a total of 17,467 health care facilities (including
                475 hospital-affiliated satellite and 270 independent freestanding
                emergency departments) will incur burden and costs to comply with this
                provision. HHS assumes that for hospital-affiliated satellite
                freestanding emergency departments, the disclosure will be developed by
                the parent hospital. HHS estimates that for each facility, on average,
                it will take a lawyer 2 hours (at an hourly rate of $143.18) to read
                and understand the provided notice and draft any additional, clear, and
                understandable language as may be needed, an administrative assistant
                30 minutes (at an hourly rate of $38.86) to prepare the final document
                for distribution and make the information publicly available within the
                facility, and a computer programmer 1 hour (at an hourly rate of
                $91.96) to post the information on a separate or existing web page, in
                a searchable manner, and to make the content available in an easily
                downloadable format. The burden will be higher for facilities in states
                with state laws or All-Payer Model Agreements, but lower for facilities
                in states without any state laws. HHS assumes that each facility will
                post a single page document in at least two prominent locations, such
                as where individuals schedule care, check-in for appointments, or pay
                bills, and estimates that each facility will incur a printing cost of
                $0.10 (at $0.05 per page for printing and materials) in order to post
                the required disclosure information prominently at each health care
                facility. HHS anticipates that hospitals will post 6 notices on
                average, and incur an additional cost of $0.20 each. In addition, HHS
                assumes that each of the 475 hospital-affiliated satellite freestanding
                emergency departments will post two notices on average and incur a cost
                of $0.10 each. HHS estimates the one-time burden, to be incurred in
                2021, to develop, prepare, and post the required disclosure
                information, for each facility will be approximately 3.5 hours, with an
                associated equivalent cost of approximately $398. For all facilities,
                HHS estimates a total one-time burden of 59,472 hours, with an
                associated cost of approximately $6.8 million, including materials and
                printing costs. HHS recognizes that there are some small providers and
                facilities that do not maintain or provide a publicly available
                website. Such entities are not required to make a disclosure on a
                public website. Therefore, HHS considers the estimate to be a high-end
                estimate.
                 HHS encourages states to develop language to assist providers and
                facilities in fulfilling this disclosure requirement. There are
                currently 33 states that have enacted laws to provide some protection
                to consumers for surprise billing. Some or all of these states may
                choose to develop model language. HHS assumes that it will take a
                lawyer 2 hours (at an hourly rate of $143.18) and an administrative
                assistant 1 hour (at an hourly rate of $38.86) to develop and amend the
                model language. The total one-time burden, to be incurred in 2021, for
                each state will be 3 hours with an equivalent cost of approximately
                $325. For all 33 states, HHS estimates the total one-time burden will
                be 99 hours with an equivalent cost of approximately $10,732.
                 In addition to requiring providers and facilities to publicly post
                and make the required disclosure publicly available through a public
                website, providers and facilities are required to provide individuals
                the required disclosure information in a one-page notice. The required
                notice must be provided in-person, through the mail or via email, as
                selected by the participant, beneficiary, or enrollee no later than the
                date on which the health care provider or health care facility requests
                payment from the individual (including requests for copayment made at
                the time of a visit to the provider or facility), or with respect to
                individual from whom the health care facility or health care provider
                does not request payment, no later than the date on which the health
                care provider or health care facility submits a claim to the group
                health plan or health insurance issuer. HHS assumes that, in order to
                reduce burden and costs, facilities will choose to provide the required
                disclosure to the individual (or their selected representative) at the
                time the individual is processed for any visit, upon check-in, or when
                other standard disclosures are shared with individuals with minimal
                additional burden. HHS estimates that there will be approximately
                39,690,940 emergency
                [[Page 36941]]
                department visits \200\ and 11,107,056 visits to health care facilities
                annually for surgical and non-surgical procedures \201\ for individuals
                with group health coverage or individual market coverage. This is a
                lower bound for the number of patients who will receive the disclosure
                since HHS lacks comprehensive data on patients who receive services on
                all health care facilities. In order to provide the required disclosure
                to individuals each facility will incur a cost of approximately $0.05
                for printing and materials for each disclosure. HHS assumes that this
                disclosure will be provided along with other forms and notices usually
                provided to individuals without incurring significant labor cost. For
                all facilities, HHS estimates a total annual ongoing annual cost of
                $2.5 million, starting in 2022. HHS recognizes that the number of
                notices provided by each facility will vary depending on the number of
                annual visits and that some facilities could incur higher costs to
                provide the disclosure while others could incur lower costs. HHS
                assumes that all disclosures will be provided in-person; however, HHS
                acknowledges that some individuals will choose to have this notice
                provided to them via email, at a minimal cost to the facility, and
                others may choose to receive the disclosure via mail, in which case the
                facility will incur additional postage costs.
                ---------------------------------------------------------------------------
                 \200\ Agency for Healthcare Research and Quality, HCUP Fast
                Stats--Trends in Emergency Department Visits.
                 \201\ Estimates based on data on postoperative office visits.
                Centers for Disease Control, National Ambulatory Medical Care
                Survey: 2016 National Summary Tables. Available at https://www.cdc.gov/nchs/fastats/physician-visits.htm.
                 \201\ Estimated based on information provided by KFF. Available
                at: https://www.kff.org/health-costs/poll-finding/data-note-public-worries-about-and-experience-with-surprise-medical-bills/.
                ---------------------------------------------------------------------------
                 HHS seeks comment on these burden estimates. Specifically, HHS
                seeks comment on the costs and burdens associated with posting the
                required information on a public website. HHS also seeks comment on the
                number of facilities that will be affected by these requirements and
                the number of individuals that would be required to receive the
                required notice.
                 Table 11--One-Time Burden and Costs Related to Agreements Between Facilities and Providers
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Estimated Estimated Burden per
                 Year number of number of response Cost per Total annual Total estimated
                 respondents responses (hours) response burden (hours) cost
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                2021.............................................. 17,467 17,467 4 $364.08 69,868 $6,359,385
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Table 12--One-Time and Annual Burden and Cost for Facilities To Provide Disclosure on Patient Protections Against Balance Billing
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Total
                 Estimated Estimated Total annual Total estimated Total
                 Year number of number of burden (hours) estimated printing and estimated cost
                 respondents responses labor cost materials cost
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                2021.................................................... 17,467 17,467 59,472 $6,758,568 $2,965 $6,761,533
                2022.................................................... 17,467 50,797,996 0 0 2,539,900 2,539,900
                2023.................................................... 17,467 50,797,996 0 0 2,539,900 2,539,900
                3 Year Average.......................................... 17,467 33,871,153 19,824 2,252,856 1,694,255 3,947,111
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Table 13--One-Time Burden and Cost for States To Develop State Specific Language for Facilities To Provide
                 Disclosure on Patient Protections Against Balance Billing
                ----------------------------------------------------------------------------------------------------------------
                 Estimated Estimated
                 Year number of number of Total annual Total estimated
                 respondents responses burden (hours) labor cost
                ----------------------------------------------------------------------------------------------------------------
                2021........................................ 33 33 99 $10,732.26
                ----------------------------------------------------------------------------------------------------------------
                9. ICRs Regarding Plan and Issuer Disclosure on Patient Protections
                Against Balance Billing
                 Section 9820(c) of the Code, section 720(c) of ERISA, and section
                2799A-5(c) of the PHS Act require plans and issuers to make publicly
                available, post on a public website of the plan or issuer, and include
                on each explanation of benefits for an item or service with respect to
                which the requirements under section 9816 of the Code, section 716 of
                ERISA, and section 2799A-1 of the PHS Act apply, information in plain
                language on the provisions in these sections, and sections 2799B-1 and
                2799B-2 of the PHS Act, and other applicable state laws on out-of-
                network balance billing, and information on contacting appropriate
                state and federal agencies in the case that an individual believes that
                such a provider or facility has violated the prohibition against
                balance billing.
                 The Departments assume that plans and issuers will use the model
                notice developed by HHS, and that TPAs will develop the notice for
                self-insured plans. The Departments estimate that on average for each
                plan or issuer it will take a lawyer 2 hours (at an hourly rate of
                $143.18) to read and understand the provided notice and draft any
                additional, clear, and understandable language as may be needed, an
                administrative assistant 30 minutes (at an hourly rate of $38.86) to
                prepare the final document for distribution and make the information
                publicly available within the facility, and a computer programmer 1
                hour (at an hourly rate of $91.96) to post the information on a
                separate or existing web page, in a searchable manner, and to make the
                content available in an easily
                [[Page 36942]]
                downloadable format. The total burden for an individual plan or issuer
                will be 3.5 hours with an equivalent cost of approximately $398. The
                burden will be higher for issuers and TPAs in states with applicable
                state laws or All-Payer Model Agreements, but lower for issuers and
                TPAs in states without any applicable state laws. The Departments
                estimate that there are 1,553 issuers and 205 TPAs. The total burden
                for all issuers and TPAs will be 6,153 hours with an equivalent cost of
                $699,245, to be incurred as a one-time cost in 2021. As DOL, the
                Treasury Department, and HHS share jurisdiction, HHS will account for
                50 percent of the burden, or approximately 3,077 hours with an
                equivalent cost of approximately $349,622.
                 The Departments assume that plans and issuers will also include the
                disclosure along with the explanation of benefits at no additional
                cost. Under the same assumptions used to estimate the number of
                disclosures provided by nonparticipating facilities and
                nonparticipating providers, the Departments estimate that issuers and
                TPAs will include the disclosure to approximately 39,690,940
                individuals who receive services at emergency facilities and 11,107,056
                individuals who received non-emergency services at health care
                facilities, for a total of 50,797,996 disclosures. The Departments
                assume that 66 percent of these notices will be provided by mail and
                the cost of printing is $0.05 per page.\202\ Therefore, the total
                printing and materials cost for sending 33,526,677 notices by mail will
                be $1,676,334 annually, starting in 2022. The Departments assume that
                for the disclosures sent by mail, it will take an administrative
                assistant 1 minute (at an hourly rate of $38.86) to print and enclose
                the notice with the explanation of benefits. The disclosures sent
                electronically can be sent at minimal cost. The total burden for all
                issuers and TPAs is estimated to be 558,778 hours with an equivalent
                cost of $21,714,111. There will be no additional mailing costs, since
                the disclosure will be enclosed with the explanation of benefits. The
                total annual cost to all issuers and TPAs for sending the notices is
                estimated to be approximately $23,390,445 starting in 2022. As DOL, the
                Treasury Department and HHS share jurisdiction, HHS will account for 50
                percent of the burden, or approximately 279,389 hours, with an
                equivalent cost of $10,857,056, and printing and materials cost of
                $838,167, for a total annual cost of $11,695,223 starting in 2022.
                ---------------------------------------------------------------------------
                 \202\ According to data from the National Telecommunications and
                Information Agency, 34 percent of households in the United States
                accessed health records or health insurance online. https://www.ntia.doc.gov/blog/2020/more-half-american-households-used-internet-health-related-activities-2019-ntia-data-show.
                 Table 14--One-Time and Annual Burden and Cost for Plans and Issuers To Provide Disclosure on Patient Protections Against Balance Billing
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Total
                 Estimated Estimated Total annual Total estimated Total
                 Year number of number of burden (hours) estimated printing and estimated cost
                 respondents responses labor cost materials cost
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                2021.................................................... 879 879 3,077 $349,622 0 $349,622
                2022.................................................... 879 25,398,998 279,389 10,857,056 838,167 11,695,223
                2023.................................................... 879 25,398,998 279,389 10,857,056 838,167 11,695,223
                3 year Average.......................................... 879 16,932,958 187,285 7,354,578 558,778 7,913,356
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                10. Summary of Annual Burden Estimates for Information Collection
                Requirements
                 Table 15--Annual Recordkeeping and Reporting Requirements
                ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                 Burden Total Hourly Printing
                 per annual labor Total labor and
                 Regulation section OMB control No. Respondents Responses response burden cost of cost of materials Total cost
                 (hours) (hours) reporting reporting cost
                ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                45 CFR 149.140(d)............................. 0938-NEW........................ 879 3,801,384 0.19 739,158 $37.50 $27,718,427 0 $27,718,427
                45 CFR 149.30................................. 0938-NEW........................ 84 84 1.50 126 69.87 8,783 197 8,981
                45 CFR 149.150, 149.450....................... 0938-NEW........................ 1,800 1,800 0.5 900 54.14 48,726 0 48,726
                45 CFR 149.310(a)(4).......................... 0938-1094....................... 5,450 5,450 0.25 1362 100.87 137,430 15,461 152,891
                45 CFR 149.410(b)--(e), 149.420(c)-(i)-- 0938-NEW........................ 17,309 1,632,707 1.28 2,086,326 38.10 79,482,349 6,216,488 85,698,837
                 Facilities and Providers.
                45 CFR 149.410(b)-(e), 149.420(c)--(i) - 0938-NEW........................ 2,440,565 2,440,565 0.75 1,830,424 54.14 99,099,147 0 99,099,147
                 Consumers.
                45 CFR 149.430--Facilities and Providers...... 0938-NEW........................ 17,467 33,871,153 * 3.5 19,824 * 113.67 2,252,856 1,694,255 3,947,111
                45 CFR 149.430--Facility and Provider 0938-NEW........................ 17,467 17,467 4 69,868 91.02 6,359,385 0 6,359,385
                 agreements.
                45 CFR 149.430--States........................ 0938-NEW........................ 33 33 3 99 108.41 10,732 0 10,732
                Section 2799A-5(c) of the PHS Act............. 0938-NEW........................ 879 16,932,958 0.01 187,285 39.27 7,354,578 558,778 7,913,356
                 ---------------------------------------------------------------------------------------------------------------
                 Total..................................... ................................ 2,501,933 58,703,602 ......... 4,935,372 ......... 222,472,414 8,485,179 230,957,592
                ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                * Estimate based on burden incurred in first year only.
                [[Page 36943]]
                11. Submission of PRA-Related Comments
                 HHS has submitted a copy of this final rule to OMB for its review
                of the rule's information collection requirements. The requirements are
                not effective until they have been approved by OMB.
                 To obtain copies of the supporting statement and any related forms
                for the collections discussed in this rule (CMS-9909-IFC), please visit
                the CMS website at www.cms.hhs.gov/PaperworkReductionActof1995, or call
                the Reports Clearance Office at 410-786-1326.
                E. Paperwork Reduction Act--Department of Labor and Department of the
                Treasury
                 As part of the continuing effort to reduce paperwork and respondent
                burden, the Departments conduct a preclearance consultation program to
                provide the general public and federal agencies with an opportunity to
                comment on proposed and continuing collections of information in
                accordance with the PRA. This helps to ensure that the public
                understands the Departments' collection instructions, respondents can
                provide the requested data in the desired format, reporting burden
                (time and financial resources) is minimized, collection instruments are
                clearly understood, and the Departments can properly assess the impact
                of collection requirements on respondents.
                 Under the PRA, an agency may not conduct or sponsor, and an
                individual is not required to respond to, a collection of information
                unless it displays a valid OMB control number.
                 The information collections are summarized as follows:
                1. ICRs Regarding Notice of Right To Designate a Primary Care Provider
                (26 CFR 54.9822-1T, 29 CFR 2590.722)
                 These interim final rules require that if a group health plan or
                health insurance issuer requires the designation by a participant,
                beneficiary, or enrollee of a primary care provider, the plan or issuer
                must provide a notice informing each participant (in the individual
                market, primary subscriber) of the terms of the plan or coverage and
                their right to designate a primary care provider. For group health
                plans and group health insurance coverage, the notice must be included
                whenever the plan or issuer provides a participant with a summary plan
                description or other similar description of benefits under the plan or
                coverage. For individual health insurance coverage, the notice must be
                included whenever the issuer provides a primary subscriber with a
                policy, certificate, or contract of health insurance. These interim
                final rules include model language to satisfy the notice requirements.
                The No Surprises Act extends the applicability of the patient
                protections for choice of health care professionals. The patient
                protections under section 2719A of the PHS Act apply to only non-
                grandfathered group health plans and health insurance issuers offering
                non-grandfathered group or individual health insurance coverage. In
                contrast, the patient protections under the No Surprises Act apply
                generally to all group health plans and group and individual health
                insurance coverage, including grandfathered health plans. Therefore,
                the requirements regarding patient protections for choice of health
                care professional under these interim final rules will newly apply to
                grandfathered health plans for plan years beginning on or after January
                1, 2022.
                 DOL estimates that there are 2.5 million ERISA-covered plans. Data
                obtained from the 2020 Kaiser/HRET Survey of Employer Sponsored Health
                Benefits finds that 16 percent of firms offering health benefits offer
                at least one grandfathered health plan. DOL estimates that five percent
                of plans will relinquish their grandfathered status in 2021. The data
                from the 2020 Kaiser/HRET Survey of Employer Sponsored Health Benefits
                also finds that 11 percent of plans have an HMO option and that 31
                percent of plans offer a POS option. Thus, DOL estimates that in 2022,
                161,148 grandfathered plans will be subject to this notice
                requirement.\203\
                ---------------------------------------------------------------------------
                 \203\ 2.5 million ERISA-covered plans x 16% grandfathered plans
                x (100% minus 5% newly non-grandfathered plans) x (11% HMOs + 31%
                POSs) = 161,148 affected plans.
                ---------------------------------------------------------------------------
                 While not all HMO and POS options require the designation of a
                primary care physician or a prior authorization or referral before an
                OB/GYN visit, DOL is unable to estimate this number. Therefore, these
                estimates should be considered an overestimate of the number of
                affected entities.
                 Each of the plans will require a compensation and benefits manager
                to spend 10 minutes individualizing the model notice to fit the plan's
                specifications at an hourly rate of $134.21.\204\ In 2022, this results
                in 26,858 hours of burden at an equivalent cost of $3,604,602.
                ---------------------------------------------------------------------------
                 \204\ For more information on how the Department estimates labor
                costs see: https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/rules-and-regulations/technical-appendices/labor-cost-inputs-used-in-ebsa-opr-ria-and-pra-burden-calculations-june-2019.pdf.
                ---------------------------------------------------------------------------
                 Each plan will also require clerical staff to spend 5 minutes
                adding the notice to the plan's documents at an hourly rate of $55.14.
                In 2022, this results in 13,429 hours of burden at an equivalent cost
                of $740,473.
                 Thus, the total hour burden associated with this ICR is 40,287
                hours at an equivalent cost of $4,345,075. DOL shares this burden
                equally with the Department of the Treasury. Therefore, the total hour
                burden for DOL and the Treasury Department is each approximately 20,143
                hours at an equivalent cost of $2,172,537.
                 The Departments assume that only printing and material costs are
                associated with the disclosure requirement, because the final
                regulations provide model language that can be incorporated into
                existing plan documents, such as an SPD. The Departments estimate that
                the notice will require one-half of a page, five cents per page
                printing and material cost will be incurred, and 58.2 percent of the
                notices will be delivered electronically.\205\
                ---------------------------------------------------------------------------
                 \205\ According to data from the National Telecommunications and
                Information Agency (NTIA), 40.0 percent of individuals age 25 and
                over have access to the internet at work. According to a Greenwald &
                Associates survey, 84 percent of plan participants find it
                acceptable to make electronic delivery the default option, which is
                used as the proxy for the number of participants who will not opt-
                out of electronic disclosure that are automatically enrolled (for a
                total of 33.6 percent receiving electronic disclosure at work).
                Additionally, the NTIA reports that 40.4 percent of individuals age
                25 and over have access to the internet outside of work. According
                to a Pew Research Center survey, 61.0 percent of internet users use
                online banking, which is used as the proxy for the number of
                internet users who will affirmatively consent to receiving
                electronic disclosures (for a total of 24.7 percent receiving
                electronic disclosure outside of work). Combining the 33.6 percent
                who receive electronic disclosure at work with the 24.7 percent who
                receive electronic disclosure outside of work produces a total of
                58.2 percent who will receive electronic disclosure overall.
                ---------------------------------------------------------------------------
                 DOL estimates that there are 62.6 million ERISA-covered
                policyholders. Data obtained from the 2020 Kaiser/HRET Survey of
                Employer Sponsored Health Benefits finds that 14 percent of covered
                workers are enrolled in a grandfathered plan. DOL estimates that 5
                percent of plans would relinquish their grandfathered status annually
                in 2021. The data from the 2020 Kaiser/HRET Survey of Employer
                Sponsored Health Benefits also finds that 13 percent of covered workers
                have an HMO option and that 8 percent of covered workers have a POS
                option. DOL estimates that plans will produce
                [[Page 36944]]
                730,346 notices in 2022.\206\ This results in a cost burden of
                approximately $18,259 in 2022.\207\ DOL shares this burden equally with
                the Department of the Treasury. Therefore, the total cost burden for
                DOL is approximately $9,129 and the total cost burden for the Treasury
                Department is $9,129. The summary of burden for this information
                collection has also been provided below.
                ---------------------------------------------------------------------------
                 \206\ 2022: 62.6 million ERISA-covered policyholders x 14% of
                covered employees in grandfathered plans x (100% minus 5% newly non-
                grandfathered plans) x (13% in HMOs + 8% in POSs) * 41.8% = 730,346
                notices.
                 \207\ 2022: $0.05 per page * 1/2 pages per notice * 730,346
                notices = $18,259.
                ---------------------------------------------------------------------------
                Summary of Burden
                 Type of Review: Revised Collection.
                 Agency: DOL-EBSA, Treasury-IRS.
                 Title: Affordable Care Act Patient Protection Notice.
                 OMB Numbers: 1210-0142, 1545-2181.
                 Affected Public: Businesses or other for-profits, Not-for-profit
                institutions.
                 Total Respondents: 161,148.
                 Total Responses: 730,346.
                 Frequency of Response: Occasionally.
                 Estimated Total Annual Burden Hours: 40,287 (DOL--20,143;
                Treasury--20,143).
                 Estimated Total Annual Burden Cost: $18,259 (DOL--$9,129;
                Treasury-- $9,129).
                2. ICRs Regarding Information To Be Shared About QPA (26 CFR 54.9816-
                6T(d), 29 CFR 2590.716-6(d))
                 These interim final rules require plans and issuers to provide
                certain information to nonparticipating providers or nonparticipating
                emergency facilities in cases in which the recognized amount with
                respect to an item or service furnished by a nonparticipating provider
                or nonparticipating emergency facility is the QPA. Specifically, plans
                and issuers must provide the following information to providers
                (including air ambulance providers) and facilities, when making an
                initial payment or notice of denial of payment: (i) The QPA for each
                item or service involved; and (ii) a statement certifying that the plan
                or issuer has determined that the QPA applies for the purposes of the
                recognized amount (or, in the case of air ambulance services, for
                calculating the participant's, beneficiary's, or enrollee's cost
                sharing), and that each QPA was determined in compliance with 26 CFR
                54.9816-6T(d), 29 CFR 2590.716-6, or 45 CFR 149.140, as applicable.
                Additionally, upon request of the provider or facility, the plan or
                issuer must provide in a timely manner the following information: (i)
                Whether the QPA for items and services involved included contracted
                rates that were not on a fee-for-service basis for those specific items
                and services and whether the QPA for those items and services was
                determined using underlying fee schedule rates or a derived amount;
                (ii) if applicable, information to identify which database was used to
                determine the QPA; and (iii) if applicable, a statement that the plan's
                or issuer's contracted rates include risk-sharing, bonus, or incentive
                based payments for covered items and services (as applicable) that were
                excluded for purposes of calculating the QPA.
                 As discussed earlier in HHS' PRA section, the total annual burden
                for all issuers and TPAs for providing the initial and additional
                information related to QPA will be 1,478,316 hours, with an equivalent
                cost of $55,436,853. As HHS, DOL, and the Treasury Department share
                jurisdiction, it is estimated that 50 percent of the burden will be
                accounted for by the HHS, 25 percent of the burden will be accounted
                for by the Treasury Department, and the remaining 25 percent will be
                accounted for by DOL. Thus, HHS will account for approximately 739,158
                burden hours with an equivalent cost of approximately $27,718,427. DOL
                and the Treasury Department will each account for 369,579 burden hours
                with an equivalent cost of approximately $13,859,214.
                3. ICRs Regarding Complaints Process for Surprise Medical Bills (26 CFR
                54.9816-7T, 29 CFR 2590.716-7)
                 The No Surprises Act directs the Departments to establish a process
                to receive complaints regarding violations of the application of the
                QPA by group health plans and health insurance issuers offering group
                or individual health coverage, and violations by health care providers,
                facilities, and providers of air ambulance services of the requirements
                under sections 2799B-2 and 2799B-3 of the PHS Act. The Departments
                define a complainant as any individual, or their authorized
                representative, who files a complaint, as described and defined in
                these interim final rules. This regulatory action is taken as required
                by the No Surprises Act, which directs the Departments to create a
                process for balance billing complaints regarding plans and issuers, and
                directs HHS to create a process for balance billing complaints
                regarding providers and facilities.
                 As discussed earlier in HHS' PRA section, the total burden for all
                complainants is estimated to be 1,800 hours, with an equivalent annual
                cost of approximately $97,452. As HHS, DOL, and the Treasury Department
                share jurisdiction, it is estimated that 50 percent of the burden will
                be accounted for by the HHS, 25 percent of the burden will be accounted
                for by the Treasury Department, and the remaining 25 percent will be
                accounted for by DOL. HHS will account for approximately 900 burden
                hours with an equivalent cost of approximately $48,726. DOL and the
                Treasury Department will each account for approximately 450 burden
                hours with an equivalent cost of approximately $24,363.
                4. ICRs Regarding Opt-In State Balance Bill Process (26 CFR 54.9816-3T,
                29 CFR 2590.716-3)
                 The interim final rules allow plans to voluntarily opt in to state
                law that provides for a method for determining the cost-sharing amount
                or total amount payable under such a plan, where a state has chosen to
                expand access to such plans, to satisfy their obligations under section
                9816(a)-(d) of the Code, section 716(a)-(d) of ERISA, and section
                2799A-1(a)-(d) of the PHS Act. A plan that has chosen to opt into a
                state law must prominently display in its plan materials describing the
                coverage of out-of-network services a statement that the plan has opted
                into a specified state law, identify the state (or states), and include
                a general description of the items and services provided by
                nonparticipating facilities and providers that are covered by the
                specified state law.
                 Currently, there are four states that allow self-insured plans to
                opt in: Nevada, New Jersey, Washington, and Virginia. According to the
                Nevada Department of Health and Human Services' 2020 Annual Report, 20
                private entities or organizations have elected to participate in the
                state's balance billing law. In addition, according to the Virginia
                State Corporation Commission, 231 private self-insured plans in
                Virginia have elected to participate in the state's balance billing
                law.\208\ Furthermore, according to Washington's Office of the
                Insurance Commissioner, 309 private self-insured plans in Washington
                have elected to participate in the state's balance billing law.\209\
                DOL does not have data on the number of self-insured plans that have
                opted into New Jersey's
                [[Page 36945]]
                balance billing law. In order to estimate the number of self-insured
                plans that have opted into the balance billing law for New Jersey, DOL
                has scaled Washington's estimate by the number of participants with
                self-insured ERISA-covered plans.\210\ According to the 2019 Health
                Insurance Coverage Bulletin, there are respectively, 0.7 million, 2.1
                million, and 2.7 million with self-insured ERISA-covered plans in
                Nevada, Virginia, and New Jersey. Additionally, according to the
                Washington's Office of Insurance Commissioner, about 0.5 million self-
                insured participants have opted into Washington's balance billing
                law.\211\ This results in a total of 6 million participants.\212\ Thus,
                DOL estimates that 20, 231, 309, and 57 private self-insured plans will
                opt in respectively in Nevada, Virginia, Washington, and New Jersey,
                resulting in a total of 617 self-insured plans.\213\ These plans will
                incur the one-time burden and cost to include the disclosure in their
                plan documents in 2022.
                ---------------------------------------------------------------------------
                 \208\ Virginia State Corporation Commission. https://scc.virginia.gov/balancebilling#.
                 \209\ Washington's Office of Insurance Commissioner. ``Self-
                Funded Group Health Plans Participating in the Balance Billing
                Protection Act.'' https://www.insurance.wa.gov/self-funded-group-health-plans.
                 \210\ Nevada Department of Health and Human Services' Office of
                Consumer Health Assistance. ``Payment for Medically Necessary
                Emergency Services Provided Out-of-Network 2020 Annual Report.''
                (2020). https://dhhs.nv.gov/uploadedFiles/dhhsnvgov/content/Programs/CHA/AB469%20LCB%20Annual%20Report%202020.pdf.
                 \211\ Washington's Office of Insurance Commissioner. ``Self-
                Funded Group Health Plans Participating in the Balance Billing
                Protection Act.'' https://www.insurance.wa.gov/self-funded-group-health-plans.
                 \212\ Employee Benefits Security Administration. ``Health
                Insurance Coverage Bulletin: Abstract of Auxiliary Data for the
                March 2019 Annual Social and Economic Supplement to the Current
                Population Survey.'' (2019). https://www.dol.gov/sites/dolgov/files/EBSA/researchers/data/health-and-welfare/health-insurance-coverage-bulletin-2019.pdf.
                 \213\ New Jersey: 335 x (0.5/2.7) = 62 self-insured plans; 62
                self-insured plans--5 non-federal self-insured plans = 57 private
                self-insured plans.
                ---------------------------------------------------------------------------
                 DOL estimates that it will take 1 hour for an administrative
                assistant, with a wage rate of $55.14, to gather information and review
                information.\214\ This results in hour burden of 617 hours, with an
                equivalent cost of $34,023. DOL estimates that it will take 30 minutes
                for a benefits manager, with a wage rate of $134.21, to gather
                information and review information.\215\ This results in hour burden of
                309 hours, with an equivalent cost of $41,406. In 2022, the total hour
                burden is 926 hours, with an equivalent cost of $75,430.
                ---------------------------------------------------------------------------
                 \214\ For more information on how the Department estimates labor
                costs see: https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/rules-and-regulations/technical-appendices/labor-cost-inputs-used-in-ebsa-opr-ria-and-pra-burden-calculations-june-2019.pdf.
                 \215\ For more information on how the Department estimates labor
                costs see: https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/rules-and-regulations/technical-appendices/labor-cost-inputs-used-in-ebsa-opr-ria-and-pra-burden-calculations-june-2019.pdf.
                ---------------------------------------------------------------------------
                 The average number of participants in a self-insured ERISA-covered
                plan that will opt into the four states' balance billing laws is
                9,724.\216\ DOL assumes that only printing and material costs are
                associated with the disclosure requirement, because the notice can be
                incorporated into existing plan documents. DOL estimates that the
                disclosure will require one-half of a page, at a cost of $0.05 per page
                for printing and materials, and 34 percent of plan documents will be
                delivered electronically at minimal cost.\217\ Thus, in 2022, the cost
                to deliver 66 percent of these disclosures in print is estimated to be
                approximately $321.\218\
                ---------------------------------------------------------------------------
                 \216\ (6,000,000 participants with self-insured ERISA-covered
                plans) / 617 self-insured ERISA-covered plans = 9,724 participants
                per self-insured ERISA-covered plan.
                 \217\ According to data from the National Telecommunications and
                Information Agency, 34 percent of households in the United States
                accessed health records or health insurance online. https://www.ntia.doc.gov/blog/2020/more-half-american-households-used-internet-health-related-activities-2019-ntia-data-show.
                 \218\ 9,724 participants x 0.66 x $0.05 = $321.
                ---------------------------------------------------------------------------
                 Thus, the 3-year average hour burden is 309 hours, with an
                equivalent cost of $25,143. The 3-year average cost burden is $107.
                5. ICRs Regarding Plan and Issuer Disclosure on Patient Protections
                Against Balance Billing
                 Section 9820(c) of the Code, section 720(c) of ERISA, and section
                2799A-5(c) of the PHS Act require plans and issuers to make publicly
                available, post on a public website of the plan or issuer, and include
                on each explanation of benefits for an item or service with respect to
                which the requirements under section 9816 of the Code, section 716 of
                ERISA, and section 2799A-1 of the PHS Act apply, information in plain
                language on the provisions in these sections, and sections 2799B-1 and
                2799B-2 of the PHS Act, and other applicable state laws on out-of-
                network balance billing, and information on contacting appropriate
                state and federal agencies in the case that an individual believes that
                such a provider or facility has violated the prohibition against
                balance billing.
                 As discussed earlier in HHS' PRA section, the total burden for all
                issuers and TPAs will be 6,153 hours with an equivalent cost of
                $699,245 in 2021. As HHS, DOL, and the Treasury Department share
                jurisdiction, it is estimated that 50 percent of the burden will be
                accounted for by the HHS, 25 percent of the burden will be accounted
                for by the Treasury Department, and the remaining 25 percent will be
                accounted for by DOL. HHS will account for approximately 3,077 hours
                with an equivalent cost of approximately $349,622. DOL and the Treasury
                Department will each account for approximately 1,539 hours with an
                equivalent cost of approximately $174,811.
                 Starting in 2022, the total burden for all issuers and TPAs is
                estimated to be 558,778 hours with an equivalent cost of $21,714,111.
                The total printing and materials cost for sending 33,526,677 notices by
                mail will be $1,676,334 annually. As HHS, DOL, and the Treasury
                Department share jurisdiction, it is estimated that 50 percent of the
                burden will be accounted for by the HHS, 25 percent of the burden will
                be accounted for by the Treasury Department, and the remaining 25
                percent will be accounted for by DOL. Thus, HHS will account for
                279,389 hours, with an equivalent cost of $10,857,056, and printing and
                materials cost of $838,167 starting in 2022. DOL and the Treasury
                Department will each account for 139,695 hours with an equivalent cost
                of $419,084.
                 Thus, the 3-year average hour burden associated with this
                requirement for DOL and the Treasury Department is 93,643 hours each
                with an equivalent cost of $7,354,578. The 3-year average cost burden
                for DOL and Treasury is $279,389 each.
                 The summary of burden below encompasses the following ICRs: (1)
                Information to be Shared about the QPA (26 CFR 54.9816-6T(d), 29 CFR
                2590.716-6(d)), (2) Complaints Process for Surprise Medical Bills (26
                CFR 54.9816-7T, 29 CFR 2590.716-7), (3) Opt-In State Balance Bill
                Process (26 CFR 54.9816-3T, 29 CFR 2590.716-3), and (4) Plan and Issuer
                Disclosure on Patient Protections Against Balance Billing.
                Summary of Burden
                 Type of Review: New Collection.
                 Agency: DOL-EBSA, Treasury.
                 Title: No Surprise Billing.
                 OMB Numbers: 1210-NEW, 1545-NEW.
                 Affected Public: Businesses or other for-profits, Not-for-profit
                institutions.
                 Total Respondents: DOL--1,985; Treasury--1,779.
                 Total Responses: DOL--10,368,277; Treasury--10,368,071.
                 Frequency of Response: Occasionally.
                 Estimated Total Annual Burden Hours: 927,652 (DOL--463,980,
                Treasury--463,672).
                [[Page 36946]]
                 Estimated Total Annual Burden Cost: $558,885 (DOL--$279,496,
                Treasury--$279, 389).
                F. Regulatory Flexibility Act
                 The Regulatory Flexibility Act (RFA), (5 U.S.C. 601 et seq.),
                requires agencies to analyze options for regulatory relief of small
                entities to prepare an initial regulatory flexibility analysis to
                describe the impact of the proposed rule on small entities, unless the
                head of the agency can certify that the rule will not have a
                significant economic impact on a substantial number of small entities.
                The RFA generally defines a ``small entity'' as (1) a proprietary firm
                meeting the size standards of the Small Business Administration (SBA),
                (2) a not-for-profit organization that is not dominant in its field, or
                (3) a small government jurisdiction with a population of less than
                50,000. States and individuals are not included in the definition of
                ``small entity.'' HHS uses a change in revenues of more than 3 to 5
                percent as its measure of significant economic impact on a substantial
                number of small entities. Individuals and states are not included in
                the definition of a small entity. These interim final rules are not
                preceded by a general notice of proposed rulemaking, and thus the
                requirements of RFA do not apply.
                G. Unfunded Mandates Reform Act
                 Section 202 of the Unfunded Mandates Reform Act of 1995 (UMRA)
                requires that agencies assess anticipated costs and benefits and take
                certain other actions before issuing a proposed rule or any final rule
                for which a general notice of proposed rulemaking was published that
                includes any Federal mandate that may result in expenditures in any 1
                year by state, local, or Tribal governments, in the aggregate, or by
                the private sector, of $100 million in 1995 dollars, updated annually
                for inflation. In 2021, that threshold is approximately $158 million.
                These interim final rules were not preceded by a general notice of
                proposed rulemaking, and thus the requirements of UMRA do not apply.
                H. Federalism
                 Executive Order 13132 outlines fundamental principles of
                federalism. It requires adherence to specific criteria by federal
                agencies in formulating and implementing policies that have
                ``substantial direct effects'' on the states, the relationship between
                the national government and states, or on the distribution of power and
                responsibilities among the various levels of government. Federal
                agencies promulgating regulations that have these federalism
                implications must consult with state and local officials, and describe
                the extent of their consultation and the nature of the concerns of
                state and local officials in the preamble to the interim final rules.
                 These interim final rules protect participants, beneficiaries, or
                enrollees in group health plans and group and individual health
                insurance coverage, and covered individuals in FEHB plans, from
                surprise medical bills for emergency services, air ambulance services
                furnished by nonparticipating providers, and non-emergency services
                furnished by nonparticipating providers at participating facilities in
                certain circumstances. A number of states currently have laws related
                to surprise medical bills. The Departments are of the view that
                Congress did not intend to supplant state laws regarding balance
                billing, but rather to supplement such laws. The provisions in these
                interim final rules are consistent with the statute's general approach
                of supplementing state law. In addition, the No Surprises Act and these
                interim final rules recognize states' traditional role as the primary
                regulators of health insurance issuers, providers, and facilities. The
                No Surprises Act authorizes states to enforce the new requirements
                regarding health insurance coverage, including those related to balance
                billing, with respect to issuers, providers, facilities, and providers
                of air ambulance services, with HHS enforcing only in cases where the
                state has notified HHS that the state does not have the authority to
                enforce or is not otherwise enforcing, or HHS has made a determination
                that a state has failed to substantially enforce the requirements.
                 In compliance with the requirement of Executive Order 13132 that
                agencies examine closely any policies that may have federalism
                implications or limit the policy making discretion of the states, the
                Departments have engaged in efforts to consult with and work
                cooperatively with affected states, including participating in
                conference calls with and attending conferences of the NAIC, and
                consulting with state insurance officials on a state-by-state basis. In
                addition, the Departments consulted with the NAIC, as required by the
                No Surprises Act, to establish the geographic regions to be used in the
                methodology for calculating the QPA.
                 OPM concluded that it would be inappropriate for FEHB plans to
                adopt varying state standards, and consistent with the FEHBA, it would
                adopt state laws where appropriate pursuant to bilaterally negotiated
                FEHB contracts.
                 While developing these interim final rules, the Departments
                attempted to balance the states' interests in regulating health
                insurance issuers, providers, and facilities with the need to ensure at
                least the minimum federal consumer protections in every state. By doing
                so, the Departments complied with the requirements of Executive Order
                13132.
                I. Congressional Review Act
                 These interim final rules are subject to the Congressional Review
                Act provisions of the Small Business Regulatory Enforcement Fairness
                Act of 1996 (5 U.S.C. 801 et seq.) and will be transmitted to the
                Congress and to the Comptroller General for review in accordance with
                such provisions.
                Statutory Authority
                 The Office of Personnel Management regulations are adopted pursuant
                to the authority contained in 5 U.S.C. 8902(p) and 5 U.S.C. 8913.
                 The Department of the Treasury regulations are adopted pursuant to
                the authority contained in sections 7805 and 9833 of the Code.
                 The Department of Labor regulations are adopted pursuant to the
                authority contained in 29 U.S.C. 1002, 1135, 1182, 1185d, 1191a, 1191b,
                and 1191c; Secretary of Labor's Order 1-2011, 77 FR 1088 (Jan. 9,
                2012).
                 The Department of Health and Human Services regulations are adopted
                pursuant to the authority contained in sections 2701 through 2763,
                2791, 2792, 2794, 2799A-1 through 2799B-9 of the PHS Act (42 U.S.C.
                300gg--300gg-63, 300gg-91, 300gg-92, 300gg-94, 300gg-300gg139), as
                amended; sections 1311 and 1321 of the ACA (42 U.S.C. 13031 and 18041).
                List of Subjects
                5 CFR Part 890
                 Administrative practice and procedure, Government employees, Health
                facilities, Health insurance, Health professions, Hostages, Iraq,
                Kuwait, Lebanon, Military personnel, Reporting and recordkeeping
                requirements, Retirement.
                26 CFR Part 54
                 Excise taxes, Health care, Health insurance, Pensions, Reporting
                and recordkeeping requirements.
                29 CFR Part 2590
                 Continuation coverage, Disclosure, Employee benefit plans, Group
                health plans, Health care, Health insurance, Medical child support,
                Reporting and recordkeeping requirements.
                45 CFR Part 144
                 Health care, Health insurance, Reporting and recordkeeping
                requirements.
                [[Page 36947]]
                45 CFR Part 147
                 Health care, Health insurance, Reporting and recordkeeping
                requirements, and State regulation of health insurance.
                45 CFR Part 149
                 Balance billing, Health care, Health insurance, Reporting and
                recordkeeping requirements, Surprise billing, State regulation of
                health insurance, Transparency in coverage.
                45 CFR Part 156
                 Administrative practice and procedure, Advertising, Advisory
                committees, Age discrimination, Alaska, Brokers, Citizenship and
                naturalization, Civil rights, Conflict of interests, Consumer
                protection, Grant programs-health, Grants administration, Health care,
                Health insurance, Health maintenance organization (HMO), Health
                records, Hospitals, Indians, Individuals with disabilities,
                Intergovernmental relations, Loan programs-health, Medicaid,
                Organization and functions (Government agencies), Prescription drugs,
                Public assistance programs, Reporting and recordkeeping requirements,
                Sex discrimination, State and local governments, Sunshine Act,
                Technical assistance, Women, Youth.
                Laurie Bodenheimer,
                Associate Director, Healthcare and Insurance Office of Personnel
                Management.
                Douglas W. O'Donnell,
                Deputy Commissioner for Services and Enforcement, Internal Revenue
                Service.
                Mark J. Mazur,
                Acting Assistant Secretary of the Treasury (Tax Policy).
                Ali Khawar,
                Assistant Secretary, Employee Benefits Security Administration,
                Department of Labor.
                Xavier Becerra,
                Secretary, Department of Health and Human Services.
                Office of Personnel Management
                 For the reasons stated in the preamble, the Office of Personnel
                Management amends 5 CFR part 890 as follows:
                PART 890--FEDERAL EMPLOYEES HEALTH BENEFITS PROGRAM
                0
                1. The authority citation for part 890 continues to read as follows:
                 Authority: 5 U.S.C. 8913; Sec. 890.102 also issued under
                sections 11202(f), 11232(e), and 11246 (b) of Pub. L. 105-33, 111
                Stat. 251; Sec. 890.111 also issued under section 1622(b) of Pub. L.
                104-106, 110 Stat. 521 (36 U.S.C. 5522); Sec. 890.112 also issued
                under section 1 of Pub. L. 110-279, 122 Stat. 2604 (2 U.S.C. 2051);
                Sec. 890.113 also issued under section 1110 of Pub. L. 116-92, 133
                Stat. 1198 (5 U.S.C. 8702 note); Sec. 890.301 also issued under
                section 311 of Pub. L. 111-3, 123 Stat. 64 (26 U.S.C. 9801); Sec.
                890.302(b) also issued under section 1001 of Pub. L. 111-148, 124
                Stat. 119, as amended by Pub. L. 111-152, 124 Stat. 1029 (42 U.S.C.
                300gg-14); Sec. 890.803 also issued under 50 U.S.C. 3516 (formerly
                50 U.S.C. 403p) and 22 U.S.C. 4069c and 4069c-1; subpart L also
                issued under section 599C of Pub. L. 101-513, 104 Stat. 2064 (5
                U.S.C. 5561 note), as amended; and subpart M also issued under
                section 721 of Pub. L. 105-261 (10 U.S.C. 1108), 112 Stat. 2061.
                Subpart A--Administration and General Provisions
                0
                2. Section 890.107 is amended by adding paragraph (e) to read as
                follows:
                Sec. 890.107 Court review.
                * * * * *
                 (e) A suit for equitable relief founded on 5 U.S.C. chapter 89 that
                is based on 5 U.S.C. 8902(p) and is governed by 5 CFR part 890 must be
                brought against OPM by December 31 of the 3rd year after the year in
                which disputed services were rendered.
                0
                3. Section 890.114 is added to subpart A to read as follows:
                Sec. 890.114 Surprise billing.
                 (a) A carrier must comply with requirements described in 26 CFR
                54.9816-3T through 54.9816-6T, 54.9817-1T, and 54.9822-1T, 29 CFR
                2590.716-3 through 2590.716-6, 2590.717-1, and 2590.722, and 45 CFR
                149.30, 149.110 through 149.140, and 149.310 in the same manner as such
                provisions apply to a group health plan or health insurance issuer
                offering group or individual health insurance coverage, subject to 5
                U.S.C. 8902(m)(1), and the provisions of the carrier's contract. For
                purposes of application of such sections, all carriers are deemed to
                offer health benefits in the large group market.
                 (b) For purposes of the provisions referenced in paragraph (a) of
                this section:
                 Group health plan or plan shall mean a ``health benefits plan''
                defined at 5 U.S.C. 8901(6), which is a Federal governmental plan
                offered pursuant to 5 U.S.C. chapter 89.
                 Health insurance issuer or issuer shall include a carrier defined
                at 5 U.S.C. 8901(7). Where the carrier for a health benefits plan is a
                voluntary association, an association of organizations or entities, or
                is otherwise comprised of multiple entities, each entity is responsible
                for compliance in the same manner as such sections apply to group
                health plans and issuers. If and to the extent an entity offering a
                health benefits plan under 5 U.S.C. chapter 89 is licensed under state
                law and is properly considered an issuer as defined at section 2791 of
                the Public Health Service Act, the entity is considered a carrier to
                the extent of its FEHB health benefits plan contractual and regulatory
                compliance.
                 Participant, beneficiary, or enrollee shall include an ``enrollee''
                or ``covered individual'' as defined by 5 CFR 890.101, as appropriate.
                 (c) When a complaint challenges a carrier's action or inaction with
                respect to the surprise billing provisions, OPM will coordinate with
                the Departments of Health and Human Services, Labor, and the Treasury
                to resolve the complaint.
                Department of the Treasury
                Internal Revenue Service
                 Accordingly, 26 CFR part 54 is amended as follows:
                PART 54--PENSION EXCISE TAXES
                0
                Paragraph 4. The authority citation for part 54 continues to read, in
                part, as follows:
                 Authority: 26 U.S.C. 7805, unless otherwise noted.
                * * * * *
                0
                Par. 5. Section 54.9801-1T is added to read as follows:
                Sec. 54.9801-1T Basis and scope (temporary).
                 (a) Statutory basis. This section and Sec. Sec. 54.9801-2 through
                54.9801-6, 54.9802-1, 54.9802-2, 54.9802-3T, 54.9802-4, 54.9811-1,
                54.9812-1, 54.9815-1251, 54.9815-2704, 54.9815-2705, 54.9815-2708,
                54.9815-2711, 54.9815-2712, 54.9815-2713, 54.9815-2713A, 54.9815-2714,
                54.9815-2715, 54.9815-2715A1, 54.9815-2715A2, 54.9815-2715A3, 54.9815-
                2719, 54.9815-2715A, 54.9816-1 through 9816-7, 54.9831-1, and 54.9833-1
                implement Chapter 100 of Subtitle K of the Internal Revenue Code of
                1986.
                 (b) Scope. A group health plan or health insurance issuer offering
                group health insurance coverage may provide greater rights to
                participants and beneficiaries than those set forth in the portability
                and market reform sections of this part. This part sets forth minimum
                requirements for group health plans and group health insurance issuers
                offering group health insurance coverage concerning certain consumer
                protections of the Health Insurance Portability and Accountability Act
                (HIPAA), including special enrollment periods and the prohibition
                against
                [[Page 36948]]
                discrimination based on a health factor, as amended by the Patient
                Protection and Affordable Care Act (Affordable Care Act). Other
                consumer protection provisions, including other protections provided by
                the Affordable Care Act, the Mental Health Parity and Addiction Equity
                Act, and the No Surprises Act are set forth in this part.
                 (c) Similar requirements under the Employee Retirement Income
                Security Act and the Public Health Service Act. Sections 701, 702, 703,
                711, 712, 716, 717, 732, and 733 of the Employee Retirement Income
                Security Act of 1974 and sections 2701, 2702, 2704, 2705, 2721, 2791,
                2799A-1, and 2799A-2 of the Public Health Service Act impose
                requirements similar to those imposed under Chapter 100 of Subtitle K
                with respect to health insurance issuers offering group health
                insurance coverage. See 29 CFR part 2590 and 45 CFR parts 144, 146,
                148, and 149. See also part B of Title XXVII of the Public Health
                Service Act and 45 CFR parts 148 and 149 for other rules applicable to
                health insurance offered in the individual market (defined in Sec.
                54.9801-2).
                0
                Par. 6. Section 54.9801-2T is added to read as follows:
                Sec. 54.9801-2T Definitions (temporary).
                 Unless otherwise provided, the definitions in this section and
                Sec. 54.9801-2 govern in applying the provisions of sections 9801
                through 9825 and 9831 through 9834.
                 Affiliation period means a period of time that must expire before
                health insurance coverage provided by an HMO becomes effective, and
                during which the HMO is not required to provide benefits.
                 COBRA definitions:
                 (1) COBRA means title X of the Consolidated Omnibus Budget
                Reconciliation Act of 1985, as amended.
                 (2) COBRA continuation coverage means coverage, under a group
                health plan, that satisfies an applicable COBRA continuation provision.
                 (3) COBRA continuation provision means section 4980B (other than
                paragraph (f)(1) of section 4980B insofar as it relates to pediatric
                vaccines), sections 601-608 of ERISA, or title XXII of the PHS Act.
                 (4) Exhaustion of COBRA continuation coverage means that an
                individual's COBRA continuation coverage ceases for any reason other
                than either failure of the individual to pay premiums on a timely
                basis, or for cause (such as making a fraudulent claim or an
                intentional misrepresentation of a material fact in connection with the
                plan). An individual is considered to have exhausted COBRA continuation
                coverage if such coverage ceases--
                 (i) Due to the failure of the employer or other responsible entity
                to remit premiums on a timely basis;
                 (ii) When the individual no longer resides, lives, or works in the
                service area of an HMO or similar program (whether or not within the
                choice of the individual) and there is no other COBRA continuation
                coverage available to the individual; or
                 (iii) When the individual incurs a claim that would meet or exceed
                a lifetime limit on all benefits and there is no other COBRA
                continuation coverage available to the individual.
                 Condition means a medical condition.
                 Creditable coverage means creditable coverage within the meaning of
                Sec. 54.9801-4(a).
                 Dependent means any individual who is or may become eligible for
                coverage under the terms of a group health plan because of a
                relationship to a participant.
                 Employee Retirement Income Security Act of 1974 (ERISA) means the
                Employee Retirement Income Security Act of 1974, as amended (29 U.S.C.
                1001 et seq.).
                 Enroll means to become covered for benefits under a group health
                plan (that is, when coverage becomes effective), without regard to when
                the individual may have completed or filed any forms that are required
                in order to become covered under the plan. For this purpose, an
                individual who has health coverage under a group health plan is
                enrolled in the plan regardless of whether the individual elects
                coverage, the individual is a dependent who becomes covered as a result
                of an election by a participant, or the individual becomes covered
                without an election.
                 Enrollment date means the first day of coverage or, if there is a
                waiting period, the first day of the waiting period. If an individual
                receiving benefits under a group health plan changes benefit packages,
                or if the plan changes group health insurance issuers, the individual's
                enrollment date does not change.
                 Excepted benefits means the benefits described as excepted in Sec.
                54.9831(c).
                 First day of coverage means, in the case of an individual covered
                for benefits under a group health plan, the first day of coverage under
                the plan and, in the case of an individual covered by health insurance
                coverage in the individual market, the first day of coverage under the
                policy or contract.
                 Genetic information has the meaning given the term in Sec.
                54.9802-3T(a)(3).
                 Group health insurance coverage means health insurance coverage
                offered in connection with a group health plan. Individual health
                insurance coverage reimbursed by the arrangements described in 29 CFR
                2510.3-1(l) is not offered in connection with a group health plan, and
                is not group health insurance coverage, provided all the conditions in
                29 CFR 2510.3-1(l) are satisfied.
                 Group health plan or plan means a group health plan within the
                meaning of Sec. 54.9831-1(a).
                 Group market means the market for health insurance coverage offered
                in connection with a group health plan. (However, certain very small
                plans may be treated as being in the individual market, rather than the
                group market; see the definition of individual market in this section.)
                 Health insurance coverage means benefits consisting of medical care
                (provided directly, through insurance or reimbursement, or otherwise)
                under any hospital or medical service policy or certificate, hospital
                or medical service plan contract, or HMO contract offered by a health
                insurance issuer. Health insurance coverage includes group health
                insurance coverage, individual health insurance coverage, and short-
                term, limited-duration insurance. However, benefits described in Sec.
                54.9831(c)(2) are not treated as benefits consisting of medical care.
                 Health insurance issuer or issuer means an insurance company,
                insurance service, or insurance organization (including an HMO) that is
                required to be licensed to engage in the business of insurance in a
                State and that is subject to State law that regulates insurance (within
                the meaning of section 514(b)(2) of ERISA). Such term does not include
                a group health plan.
                 Health maintenance organization or HMO means--
                 (1) A federally qualified health maintenance organization (as
                defined in section 1301(a) of the PHS Act);
                 (2) An organization recognized under State law as a health
                maintenance organization; or
                 (3) A similar organization regulated under State law for solvency
                in the same manner and to the same extent as such a health maintenance
                organization.
                 Individual health insurance coverage means health insurance
                coverage offered to individuals in the individual market, but does not
                include short-term, limited-duration insurance. Individual health
                insurance coverage can include dependent coverage.
                 Individual market means the market for health insurance coverage
                offered to individuals other than in connection
                [[Page 36949]]
                with a group health plan. Unless a State elects otherwise in accordance
                with section 2791(e)(1)(B)(ii) of the PHS Act, such term also includes
                coverage offered in connection with a group health plan that has fewer
                than two participants who are current employees on the first day of the
                plan year.
                 Issuer means a health insurance issuer.
                 Late enrollee means an individual whose enrollment in a plan is a
                late enrollment.
                 Late enrollment means enrollment of an individual under a group
                health plan other than on the earliest date on which coverage can
                become effective for the individual under the terms of the plan; or
                through special enrollment. (For rules relating to special enrollment,
                see Sec. 54.9801-6.) If an individual ceases to be eligible for
                coverage under a plan, and then subsequently becomes eligible for
                coverage under the plan, only the individual's most recent period of
                eligibility is taken into account in determining whether the individual
                is a late enrollee under the plan with respect to the most recent
                period of coverage. Similar rules apply if an individual again becomes
                eligible for coverage following a suspension of coverage that applied
                generally under the plan.
                 Medical care has the meaning given such term by section 213(d),
                determined without regard to section 213(d)(1)(C) and so much of
                section 213(d)(1)(D) as relates to qualified long-term care insurance.
                 Medical condition or condition means any condition, whether
                physical or mental, including, but not limited to, any condition
                resulting from illness, injury (whether or not the injury is
                accidental), pregnancy, or congenital malformation. However, genetic
                information is not a condition.
                 Participant means participant within the meaning of section 3(7) of
                ERISA.
                 Placement, or being placed, for adoption means the assumption and
                retention of a legal obligation for total or partial support of a child
                by a person with whom the child has been placed in anticipation of the
                child's adoption. The child's placement for adoption with such person
                ends upon the termination of such legal obligation.
                 Plan year means the year that is designated as the plan year in the
                plan document of a group health plan, except that if the plan document
                does not designate a plan year or if there is no plan document, the
                plan year is--
                 (1) The deductible or limit year used under the plan;
                 (2) If the plan does not impose deductibles or limits on a yearly
                basis, then the plan year is the policy year;
                 (3) If the plan does not impose deductibles or limits on a yearly
                basis, and either the plan is not insured or the insurance policy is
                not renewed on an annual basis, then the plan year is the employer's
                taxable year; or
                 (4) In any other case, the plan year is the calendar year.
                 Preexisting condition exclusion means a limitation or exclusion of
                benefits (including a denial of coverage) based on the fact that the
                condition was present before the effective date of coverage (or if
                coverage is denied, the date of the denial) under a group health plan
                or group or individual health insurance coverage (or other coverage
                provided to federally eligible individuals pursuant to 45 CFR part
                148), whether or not any medical advice, diagnosis, care, or treatment
                was recommended or received before that day. A preexisting condition
                exclusion includes any limitation or exclusion of benefits (including a
                denial of coverage) applicable to an individual as a result of
                information relating to an individual's health status before the
                individual's effective date of coverage (or if coverage is denied, the
                date of the denial) under a group health plan, or group or individual
                health insurance coverage (or other coverage provided to federally
                eligible individuals pursuant to 45 CFR part 148), such as a condition
                identified as a result of a pre-enrollment questionnaire or physical
                examination given to the individual, or review of medical records
                relating to the pre-enrollment period.
                 Public health plan means public health plan within the meaning of
                Sec. 54.9801-4(a)(1)(ix).
                 Public Health Service Act (PHS Act) means the Public Health Service
                Act (42 U.S.C. 201, et seq.).
                 Short-term, limited-duration insurance means health insurance
                coverage provided pursuant to a contract with an issuer that:
                 (1) Has an expiration date specified in the contract that is less
                than 12 months after the original effective date of the contract and,
                taking into account renewals or extensions, has a duration of no longer
                than 36 months in total;
                 (2) With respect to policies having a coverage start date before
                January 1, 2019, displays prominently in the contract and in any
                application materials provided in connection with enrollment in such
                coverage in at least 14 point type the language in the following Notice
                1, excluding the heading ``Notice 1,'' with any additional information
                required by applicable state law:
                Notice 1
                 This coverage is not required to comply with certain federal
                market requirements for health insurance, principally those
                contained in the Affordable Care Act. Be sure to check your policy
                carefully to make sure you are aware of any exclusions or
                limitations regarding coverage of preexisting conditions or health
                benefits (such as hospitalization, emergency services, maternity
                care, preventive care, prescription drugs, and mental health and
                substance use disorder services). Your policy might also have
                lifetime and/or annual dollar limits on health benefits. If this
                coverage expires or you lose eligibility for this coverage, you
                might have to wait until an open enrollment period to get other
                health insurance coverage. Also, this coverage is not ``minimum
                essential coverage.'' If you don't have minimum essential coverage
                for any month in 2018, you may have to make a payment when you file
                your tax return unless you qualify for an exemption from the
                requirement that you have health coverage for that month.
                 (3) With respect to policies having a coverage start date on or
                after January 1, 2019, displays prominently in the contract and in any
                application materials provided in connection with enrollment in such
                coverage in at least 14 point type the language in the following Notice
                2, excluding the heading ``Notice 2,'' with any additional information
                required by applicable state law:
                Notice 2
                 This coverage is not required to comply with certain federal
                market requirements for health insurance, principally those
                contained in the Affordable Care Act. Be sure to check your policy
                carefully to make sure you are aware of any exclusions or
                limitations regarding coverage of preexisting conditions or health
                benefits (such as hospitalization, emergency services, maternity
                care, preventive care, prescription drugs, and mental health and
                substance use disorder services). Your policy might also have
                lifetime and/or annual dollar limits on health benefits. If this
                coverage expires or you lose eligibility for this coverage, you
                might have to wait until an open enrollment period to get other
                health insurance coverage.
                 (4) If a court holds the 36-month maximum duration provision set
                forth in paragraph (1) of this definition or its applicability to any
                person or circumstances invalid, the remaining provisions and their
                applicability to other people or circumstances shall continue in
                effect.
                 Significant break in coverage means a significant break in coverage
                within the meaning of Sec. 54.9801-4(b)(2)(iii).
                 Special enrollment means enrollment in a group health plan under
                the rights described in Sec. 54.9801-6 or in group health insurance
                coverage under the rights described in 29 CFR 2590.701-6 or 45 CFR
                146.117.
                [[Page 36950]]
                 State health benefits risk pool means a State health benefits risk
                pool within the meaning of Sec. 54.9801-4(a)(1)(vii).
                 Travel insurance means insurance coverage for personal risks
                incident to planned travel, which may include, but is not limited to,
                interruption or cancellation of trip or event, loss of baggage or
                personal effects, damages to accommodations or rental vehicles, and
                sickness, accident, disability, or death occurring during travel,
                provided that the health benefits are not offered on a stand-alone
                basis and are incidental to other coverage. For this purpose, the term
                travel insurance does not include major medical plans that provide
                comprehensive medical protection for travelers with trips lasting 6
                months or longer, including, for example, those working overseas as an
                expatriate or military personnel being deployed.
                 Waiting period means waiting period within the meaning of Sec.
                54.9815-2708(b).
                0
                Par. 7. Section 54.9815-2719AT is added to read as follows:
                Sec. 54.9815-2719AT Patient protections (temporary).
                 (a)-(b) [Reserved]
                 (c) Applicability date. The provisions of this section are
                applicable to group health plans and health insurance issuers for plan
                years beginning before January 1, 2022. See also Sec. Sec. 54.9816-4T
                through 54.9816-7T, 54.9817-1T, and 54.9822-1T for rules applicable
                with respect to plan years beginning on or after January 1, 2022.
                0
                Par. 8. Sections 54.9816-1T, 54.9816-2T, 54.9816-3T, 54.9816-4T,
                54.9816-5T, 54.9816-6T, 54.9816-7T, 54.9817-1T, and 54.9822-1T are
                added to read as follows:
                Sec.
                54.9816-1T Basis and scope (temporary).
                54.9816-2T Applicability (temporary).
                54.9816-3T Definitions (temporary).
                54.9816-4T Preventing surprise medical bills for emergency services
                (temporary).
                54.9816-5T Preventing surprise medical bills for non-emergency
                services performed by nonparticipating providers at certain
                participating facilities (temporary).
                54.9816-6T Methodology for calculating qualifying payment amount
                (temporary).
                54.9816-7T Complaints process for surprise medical bills regarding
                group health plans (temporary).
                54.9817-1T Preventing surprise medical bills for air ambulance
                services (temporary).
                54.9822-1T Choice of health care professional (temporary).
                * * * * *
                Sec. 54.9816-1T Basis and scope (temporary).
                 (a) Basis. This section and Sec. Sec. 54.9816-2T through 54.9816-
                7T, 54.9817-1T, and 54.9822-1T implement subchapter B of chapter 100 of
                the Internal Revenue Code of 1986.
                 (b) Scope. This part establishes standards for group health plans
                with respect to surprise medical bills, transparency in health care
                coverage, and additional patient protections.
                Sec. 54.9816-2T Applicability (temporary).
                 (a) In general. The requirements in Sec. Sec. 54.9816-4T through
                54.9816-7T, 54.9817-1T, and 54.9822-1T apply to group health plans
                (including grandfathered health plans as defined in Sec. 54.9815-
                1251T), except as specified in paragraph (b) of this section.
                 (b) Exceptions. The requirements in Sec. Sec. 54.9816-4T through
                54.9816-7T, 54.9817-1T, and 54.9822-1T do not apply to the following:
                 (1) Excepted benefits as described in Sec. 54.9831-1(c).
                 (2) Short-term, limited-duration insurance as defined in Sec.
                54.9801-2.
                 (3) Health reimbursement arrangements or other account-based group
                health plans as described in Sec. 54.9815-2711(d).
                Sec. 54.9816-3T Definitions (temporary).
                 The definitions in Sec. 54.9801-2T apply to Sec. Sec. 54.9816-4T
                through 54.9816-7T, 54.9817-1T, and 54.9822-1T unless otherwise
                specified. In addition, for purposes of Sec. Sec. 54.9816-4T through
                54.9816-7T, 54.9817-1T, and 54.9822-1T, the following definitions
                apply:
                 Air ambulance service means medical transport by a rotary wing air
                ambulance, as defined in 42 CFR 414.605, or fixed wing air ambulance,
                as defined in 42 CFR 414.605, for patients.
                 Cost sharing means the amount a participant, beneficiary, or
                enrollee is responsible for paying for a covered item or service under
                the terms of the group health plan or health insurance coverage. Cost
                sharing generally includes copayments, coinsurance, and amounts paid
                towards deductibles, but does not include amounts paid towards
                premiums, balance billing by out-of-network providers, or the cost of
                items or services that are not covered under a group health plan or
                health insurance coverage.
                 Emergency department of a hospital includes a hospital outpatient
                department that provides emergency services.
                 Emergency medical condition has the meaning given the term in Sec.
                54.9816-4T(c)(1).
                 Emergency services has the meaning given the term in Sec. 54.9816-
                4T(c)(2).
                 Health care facility, with respect to a group health plan, in the
                context of non-emergency services, is each of the following:
                 (1) A hospital (as defined in section 1861(e) of the Social
                Security Act);
                 (2) A hospital outpatient department;
                 (3) A critical access hospital (as defined in section 1861(mm)(1)
                of the Social Security Act); and
                 (4) An ambulatory surgical center described in section
                1833(i)(1)(A) of the Social Security Act.
                 Independent freestanding emergency department means a health care
                facility (not limited to those described in the definition of health
                care facility with respect to non-emergency services) that--
                 (1) Is geographically separate and distinct and licensed separately
                from a hospital under applicable State law; and
                 (2) Provides any emergency services as described in Sec. 54.9816-
                4T(c)(2)(i).
                 Nonparticipating emergency facility means an emergency department
                of a hospital, or an independent freestanding emergency department (or
                a hospital, with respect to services that pursuant to Sec. 54.9816-
                4T(c)(2)(ii) are included as emergency services), that does not have a
                contractual relationship directly or indirectly with a group health
                plan, with respect to the furnishing of an item or service under the
                plan.
                 Nonparticipating provider means any physician or other health care
                provider who does not have a contractual relationship directly or
                indirectly with a group health plan, with respect to the furnishing of
                an item or service under the plan.
                 Notice of denial of payment means, with respect to an item or
                service for which benefits subject to the protections of Sec. Sec.
                54.9816-4T, 54.9816-5T, and 54.9817-1T are provided or covered, a
                written notice from the plan to the health care provider, facility, or
                provider of air ambulance services, as applicable, that payment for
                such item or service will not be made by the plan and which explains
                the reason for denial. The term notice of denial of payment does not
                include a notice of benefit denial due to an adverse benefit
                determination as defined in 29 CFR 2560.503-1.
                 Out-of-network rate means, with respect to an item or service
                furnished by a nonparticipating provider, nonparticipating emergency
                facility, or nonparticipating provider of air ambulance services--
                 (1) Subject to paragraph (3) of this definition, in a State that
                has in effect a specified State law, the amount determined in
                accordance with such law;
                [[Page 36951]]
                 (2) Subject to paragraph (3) of this definition, in a State that
                does not have in effect a specified State law--
                 (i) Subject to paragraph (2)(ii) of this definition, if the
                nonparticipating provider or nonparticipating emergency facility and
                the plan agree on an amount of payment (including if the amount agreed
                upon is the initial payment sent by the plan under Sec. 54.9816-
                4T(b)(3)(iv)(A), Sec. 54.9816-5T(c)(3), or Sec. 54.9817-1T(b)(4)(i);
                29 CFR 2590.716-4(b)(3)(iv)(A), 2590.716-5(c)(3), or 2590.717-
                1(b)(4)(i); or 45 CFR 149.110(b)(3)(iv)(A), 149.120(c)(3), or
                149.130(b)(4)(i), as applicable, or is agreed on through negotiations
                with respect to such item or service), such agreed on amount; or
                 (ii) If the nonparticipating provider or nonparticipating emergency
                facility and the plan enter into the independent dispute resolution
                (IDR) process under section 9816(c) or 9817(b) of the Internal Revenue
                Code, section 716(c) or 717(b) of ERISA, or section 2799A-1(c) or
                2799A-2(b) of the PHS Act, as applicable, and do not agree before the
                date on which a certified IDR entity makes a determination with respect
                to such item or service under such subsection, the amount of such
                determination; or
                 (3) In a State that has an All-Payer Model Agreement under section
                1115A of the Social Security Act that applies with respect to the plan;
                the nonparticipating provider or nonparticipating emergency facility;
                and the item or service, the amount that the State approves under the
                All-Payer Model Agreement for the item or service.
                 Participating emergency facility means any emergency department of
                a hospital, or an independent freestanding emergency department (or a
                hospital, with respect to services that pursuant to Sec. 54.9816-
                4T(c)(2)(ii) are included as emergency services), that has a
                contractual relationship directly or indirectly with a group health
                plan setting forth the terms and conditions on which a relevant item or
                service is provided to a participant or beneficiary under the plan. A
                single case agreement between an emergency facility and a plan that is
                used to address unique situations in which a participant or beneficiary
                requires services that typically occur out-of-network constitutes a
                contractual relationship for purposes of this definition, and is
                limited to the parties to the agreement.
                 Participating health care facility means any health care facility
                described in this section that has a contractual relationship directly
                or indirectly with a group health plan setting forth the terms and
                conditions on which a relevant item or service is provided to a
                participant or beneficiary under the plan. A single case agreement
                between a health care facility and a plan that is used to address
                unique situations in which a participant or beneficiary requires
                services that typically occur out-of-network constitutes a contractual
                relationship for purposes of this definition, and is limited to the
                parties to the agreement.
                 Participating provider means any physician or other health care
                provider who has a contractual relationship directly or indirectly with
                a group health plan setting forth the terms and conditions on which a
                relevant item or service is provided to a participant or beneficiary
                under the plan.
                 Physician or health care provider means a physician or other health
                care provider who is acting within the scope of practice of that
                provider's license or certification under applicable State law, but
                does not include a provider of air ambulance services.
                 Provider of air ambulance services means an entity that is licensed
                under applicable State and Federal law to provide air ambulance
                services.
                 Same or similar item or service has the meaning given the term in
                Sec. 54.9816-6T(a)(13).
                 Service code has the meaning given the term in Sec. 54.9816-
                6T(a)(14).
                 Qualifying payment amount has the meaning given the term in Sec.
                54.9816-6T(a)(16).
                 Recognized amount means, with respect to an item or service
                furnished by a nonparticipating provider or nonparticipating emergency
                facility--
                 (1) Subject to paragraph (3) of this definition, in a State that
                has in effect a specified State law, the amount determined in
                accordance with such law.
                 (2) Subject to paragraph (3) of this definition, in a State that
                does not have in effect a specified State law, the lesser of--
                 (i) The amount that is the qualifying payment amount (as determined
                in accordance with Sec. 54.9816-6T); or
                 (ii) The amount billed by the provider or facility.
                 (3) In a State that has an All-Payer Model Agreement under section
                1115A of the Social Security Act that applies with respect to the plan;
                the nonparticipating provider or nonparticipating emergency facility;
                and the item or service, the amount that the State approves under the
                All-Payer Model Agreement for the item or service.
                 Specified State law means a State law that provides for a method
                for determining the total amount payable under a group health plan to
                the extent such State law applies for an item or service furnished by a
                nonparticipating provider or nonparticipating emergency facility
                (including where it applies because the State has allowed a plan that
                is not otherwise subject to applicable State law an opportunity to opt
                in, subject to section 514 of the Employee Retirement Income Security
                Act of 1974). A group health plan that opts into such a specified State
                law must do so for all items and services to which the specified State
                law applies and in a manner determined by the applicable State
                authority, and must prominently display in its plan materials
                describing the coverage of out-of-network services a statement that the
                plan has opted into the specified State law, identify the relevant
                State (or States), and include a general description of the items and
                services provided by nonparticipating facilities and providers that are
                covered by the specified State law.
                 State means each of the 50 States, the District of Columbia, Puerto
                Rico, the Virgin Islands, Guam, American Samoa, and the Northern
                Mariana Islands.
                 Treating provider is a physician or health care provider who has
                evaluated the individual.
                 Visit, with respect to items and services furnished to an
                individual at a health care facility, includes, in addition to items
                and services furnished by a provider at the facility, equipment and
                devices, telemedicine services, imaging services, laboratory services,
                and preoperative and postoperative services, regardless of whether the
                provider furnishing such items or services is at the facility.
                Sec. 54.9816-4T Preventing surprise medical bills for emergency
                services (temporary).
                 (a) In general. If a group health plan provides or covers 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, the plan must cover emergency
                services, as defined in paragraph (c)(2) of this section, and this
                coverage must be provided in accordance with paragraph (b) of this
                section.
                 (b) Coverage requirements. A plan described in paragraph (a) of
                this section must provide coverage for emergency services in the
                following manner--
                 (1) Without the need for any prior authorization determination,
                even if the services are provided on an out-of-network basis.
                [[Page 36952]]
                 (2) Without regard to whether the health care provider furnishing
                the emergency services is a participating provider or a participating
                emergency facility, as applicable, with respect to the services.
                 (3) If the emergency services are provided by a nonparticipating
                provider or a nonparticipating emergency facility--
                 (i) Without imposing any administrative requirement or limitation
                on coverage that is more restrictive than the requirements or
                limitations that apply to emergency services received from
                participating providers and participating emergency facilities.
                 (ii) Without imposing cost-sharing requirements that are greater
                than the requirements that would apply if the services were provided by
                a participating provider or a participating emergency facility.
                 (iii) By calculating the cost-sharing requirement as if the total
                amount that would have been charged for the services by such
                participating provider or participating emergency facility were equal
                to the recognized amount for such services.
                 (iv) The plan--
                 (A) Not later than 30 calendar days after the bill for the services
                is transmitted by the provider or facility (or, in cases where the
                recognized amount is determined by a specified State law or All-Payer
                Model Agreement, such other timeframe as specified by the State law or
                All-Payer Model Agreement), determines whether the services are covered
                under the plan and, if the services are covered, sends to the provider
                or facility, as applicable, an initial payment or a notice of denial of
                payment. For purposes of this paragraph (b)(3)(iv)(A), the 30-calendar-
                day period begins on the date the plan receives the information
                necessary to decide a claim for payment for the services.
                 (B) Pays a total plan payment directly to the nonparticipating
                provider or nonparticipating facility that is equal to the amount by
                which the out-of-network rate for the services exceeds the cost-sharing
                amount for the services (as determined in accordance with paragraphs
                (b)(3)(ii) and (iii) of this section), less any initial payment amount
                made under paragraph (b)(3)(iv)(A) of this section. The total plan
                payment must be made in accordance with the timing requirement
                described in section 9816(c)(6), or in cases where the out-of-network
                rate is determined under a specified State law or All-Payer Model
                Agreement, such other timeframe as specified by the State law or All-
                Payer Model Agreement.
                 (v) By counting any cost-sharing payments made by the participant
                or beneficiary with respect to the emergency services toward any in-
                network deductible or in-network out-of-pocket maximums (including the
                annual limitation on cost sharing under section 2707(b) of the Public
                Health Service Act) (as applicable) applied under the plan (and the in-
                network deductible and in-network out-of-pocket maximums must be
                applied) in the same manner as if the cost-sharing payments were made
                with respect to emergency services furnished by a participating
                provider or a participating emergency facility.
                 (4) Without limiting what constitutes an emergency medical
                condition (as defined in paragraph (c)(1) of this section) solely on
                the basis of diagnosis codes.
                 (5) Without regard to any other term or condition of the coverage,
                other than--
                 (i) The exclusion or coordination of benefits (to the extent not
                inconsistent with benefits for an emergency medical condition, as
                defined in paragraph (c)(1) of this section).
                 (ii) An affiliation or waiting period (each as defined in Sec.
                54.9801-2).
                 (iii) Applicable cost sharing.
                 (c) Definitions. In this section--
                 (1) Emergency medical condition means a medical condition,
                including a mental health condition or substance use disorder,
                manifesting itself by acute symptoms of sufficient severity (including
                severe pain) such that a prudent layperson, who possesses an average
                knowledge of health and medicine, could reasonably expect the absence
                of immediate medical attention to result in a condition described in
                clause (i), (ii), or (iii) of section 1867(e)(1)(A) of the Social
                Security Act (42 U.S.C. 1395dd(e)(1)(A)). (In that provision of the
                Social Security Act, clause (i) refers to placing the health of the
                individual (or, with respect to a pregnant woman, the health of the
                woman or her unborn child) in serious jeopardy; clause (ii) refers to
                serious impairment to bodily functions; and clause (iii) refers to
                serious dysfunction of any bodily organ or part.)
                 (2) Emergency services means, with respect to an emergency medical
                condition--
                 (i) In general. (A) An appropriate medical screening examination
                (as required under section 1867 of the Social Security Act (42 U.S.C.
                1395dd) or as would be required under such section if such section
                applied to an independent freestanding emergency department) that is
                within the capability of the emergency department of a hospital or of
                an independent freestanding emergency department, as applicable,
                including ancillary services routinely available to the emergency
                department to evaluate such emergency medical condition; and
                 (B) Within the capabilities of the staff and facilities available
                at the hospital or the independent freestanding emergency department,
                as applicable, such further medical examination and treatment as are
                required under section 1867 of the Social Security Act (42 U.S.C.
                1395dd), or as would be required under such section if such section
                applied to an independent freestanding emergency department, to
                stabilize the patient (regardless of the department of the hospital in
                which such further examination or treatment is furnished).
                 (ii) Inclusion of additional services. (A) Subject to paragraph
                (c)(2)(ii)(B) of this section, items and services--
                 (1) For which benefits are provided or covered under the plan; and
                 (2) That are furnished by a nonparticipating provider or
                nonparticipating emergency facility (regardless of the department of
                the hospital in which such items or services are furnished) after the
                participant or beneficiary is stabilized and as part of outpatient
                observation or an inpatient or outpatient stay with respect to the
                visit in which the services described in paragraph (c)(2)(i) of this
                section are furnished.
                 (B) Items and services described in paragraph (c)(2)(ii)(A) of this
                section are not included as emergency services if all of the conditions
                in 45 CFR 149.410(b) are met.
                 (3) To stabilize, with respect to an emergency medical condition,
                has the meaning given such term in section 1867(e)(3) of the Social
                Security Act (42 U.S.C. 1395dd(e)(3)).
                 (d) Applicability date. The provisions of this section are
                applicable with respect to plan years beginning on or after January 1,
                2022.
                Sec. 54.9816-5T Preventing surprise medical bills for non-emergency
                services performed by nonparticipating providers at certain
                participating facilities (temporary).
                 (a) In general. If a group health plan provides or covers any
                benefits with respect to items and services described in paragraph (b)
                of this section, the plan must cover the items and services when
                furnished by a nonparticipating provider in accordance with paragraph
                (c) of this section.
                 (b) Items and services described. The items and services described
                in this paragraph (b) are items and services (other than emergency
                services) furnished to a participant or beneficiary
                [[Page 36953]]
                by a nonparticipating provider with respect to a visit at a
                participating health care facility, unless the provider has satisfied
                the notice and consent criteria of 45 CFR 149.420(c) through (i) with
                respect to such items and services.
                 (c) Coverage requirements. In the case of items and services
                described in paragraph (b) of this section, the plan--
                 (1) Must not impose a cost-sharing requirement for the items and
                services that is greater than the cost-sharing requirement that would
                apply if the items or services had been furnished by a participating
                provider.
                 (2) Must calculate the cost-sharing requirements as if the total
                amount that would have been charged for the items and services by such
                participating provider were equal to the recognized amount for the
                items and services.
                 (3) Not later than 30 calendar days after the bill for the items or
                services is transmitted by the provider (or in cases where the
                recognized amount is determined by a specified State law or All-Payer
                Model Agreement, such other timeframe as specified under the State law
                or All-Payer Model Agreement), must determine whether the items and
                services are covered under the plan and, if the items and services are
                covered, send to the provider an initial payment or a notice of denial
                of payment. For purposes of this paragraph (c)(3), the 30-calendar-day
                period begins on the date the plan receives the information necessary
                to decide a claim for payment for the items or services.
                 (4) Must pay a total plan payment directly to the nonparticipating
                provider that is equal to the amount by which the out-of-network rate
                for the items and services involved exceeds the cost-sharing amount for
                the items and services (as determined in accordance with paragraphs
                (c)(1) and (2) of this section), less any initial payment amount made
                under paragraph (c)(3) of this section. The total plan payment must be
                made in accordance with the timing requirement described in section
                9816(c)(6) or in cases where the out-of-network rate is determined
                under a specified State law or All-Payer Model Agreement, such other
                timeframe as specified by the State law or All-Payer Model Agreement.
                 (5) Must count any cost-sharing payments made by the participant or
                beneficiary toward any in-network deductible and in-network out-of-
                pocket maximums (including the annual limitation on cost sharing under
                section 2707(b) of the Public Health Service Act) (as applicable)
                applied under the plan (and the in-network deductible and out-of-pocket
                maximums must be applied) in the same manner as if such cost-sharing
                payments were made with respect to items and services furnished by a
                participating provider.
                 (d) Applicability date. The provisions of this section are
                applicable with respect to plan years beginning on or after January 1,
                2022.
                Sec. 54.9816-6T Methodology for calculating qualifying payment amount
                (temporary).
                 (a) Definitions. For purposes of this section, the following
                definitions apply:
                 (1) Contracted rate means the total amount (including cost sharing)
                that a group health plan has contractually agreed to pay a
                participating provider, facility, or provider of air ambulance services
                for covered items and services, whether directly or indirectly,
                including through a third-party administrator or pharmacy benefit
                manager. Solely for purposes of this definition, a single case
                agreement, letter of agreement, or other similar arrangement between a
                provider, facility, or air ambulance provider and a plan, used to
                supplement the network of the plan for a specific participant or
                beneficiary in unique circumstances, does not constitute a contract.
                 (2) Derived amount has the meaning given the term in Sec. 54.9815-
                2715A1.
                 (3) Eligible database means--
                 (i) A State all-payer claims database; or
                 (ii) Any third-party database which--
                 (A) Is not affiliated with, or owned or controlled by, any health
                insurance issuer, or a health care provider, facility, or provider of
                air ambulance services (or any member of the same controlled group as,
                or under common control with, such an entity). For purposes of this
                paragraph (a)(3)(ii)(A), the term controlled group means a group of two
                or more persons that is treated as a single employer under sections
                52(a), 52(b), 414(m), or 414(o) of the Internal Revenue Code of 1986,
                as amended;
                 (B) Has sufficient information reflecting in-network amounts paid
                by group health plans or health insurance issuers offering group or
                individual health insurance coverage to providers, facilities, or
                providers of air ambulance services for relevant items and services
                furnished in the applicable geographic region; and
                 (C) Has the ability to distinguish amounts paid to participating
                providers and facilities by commercial payers, such as group health
                plans and health insurance issuers offering group or individual health
                insurance coverage, from all other claims data, such as amounts billed
                by nonparticipating providers or facilities and amounts paid by public
                payers, including the Medicare program under title XVIII of the Social
                Security Act, the Medicaid program under title XIX of the Social
                Security Act (or a demonstration project under title XI of the Social
                Security Act), or the Children's Health Insurance Program under title
                XXI of the Social Security Act.
                 (4) Facility of the same or similar facility type means, with
                respect to emergency services, either--
                 (i) An emergency department of a hospital; or
                 (ii) An independent freestanding emergency department.
                 (5) First coverage year means, with respect to an item or service
                for which coverage is not offered in 2019 under a group health plan,
                the first year after 2019 for which coverage for such item or service
                is offered under that plan.
                 (6) First sufficient information year means, with respect to a
                group health plan--
                 (i) In the case of an item or service for which the plan does not
                have sufficient information to calculate the median of the contracted
                rates described in paragraph (b) of this section in 2019, the first
                year after 2022 for which the plan has sufficient information to
                calculate the median of such contracted rates in the year immediately
                preceding that first year after 2022; and
                 (ii) In the case of a newly covered item or service, the first year
                after the first coverage year for such item or service with respect to
                such plan for which the plan has sufficient information to calculate
                the median of the contracted rates described in paragraph (b) of this
                section in the year immediately preceding that first year.
                 (7) Geographic region means--
                 (i) For items and services other than air ambulance services--
                 (A) Subject to paragraphs (a)(7)(i)(B) and (C) of this section, one
                region for each metropolitan statistical area, as described by the U.S.
                Office of Management and Budget and published by the U.S. Census
                Bureau, in a State, and one region consisting of all other portions of
                the State.
                 (B) If a plan does not have sufficient information to calculate the
                median of the contracted rates described in paragraph (b) of this
                section for an item or service provided in a geographic region
                described in paragraph (a)(7)(i)(A) of this section, one region
                consisting of all metropolitan statistical areas, as described by the
                U.S. Office of Management and Budget and published by the U.S. Census
                Bureau, in the State, and one region consisting of all other portions
                of the State.
                 (C) If a plan does not have sufficient information to calculate the
                median of the contracted rates described in paragraph (b) of this
                section for an item
                [[Page 36954]]
                or service provided in a geographic region described in paragraph
                (a)(7)(i)(B) of this section, one region consisting of all metropolitan
                statistical areas, as described by the U.S. Office of Management and
                Budget and published by the U.S. Census Bureau, in each Census division
                and one region consisting of all other portions of the Census division,
                as described by the U.S. Census Bureau.
                 (ii) For air ambulance services--
                 (A) Subject to paragraph (a)(7)(ii)(B) of this section, one region
                consisting of all metropolitan statistical areas, as described by the
                U.S. Office of Management and Budget and published by the U.S. Census
                Bureau, in the State, and one region consisting of all other portions
                of the State, determined based on the point of pick-up (as defined in
                42 CFR 414.605).
                 (B) If a plan does not have sufficient information to calculate the
                median of the contracted rates described in paragraph (b) of this
                section for an air ambulance service provided in a geographic region
                described in paragraph (a)(7)(ii)(A) of this section, one region
                consisting of all metropolitan statistical areas, as described by the
                U.S. Office of Management and Budget and published by the U.S. Census
                Bureau, in each Census division and one region consisting of all other
                portions of the Census division, as described by the U.S. Census
                Bureau, determined based on the point of pick-up (as defined in 42 CFR
                414.605).
                 (8) Insurance market is, irrespective of the State, one of the
                following:
                 (i) The individual market (other than short-term, limited-duration
                insurance or individual health insurance coverage that consists solely
                of excepted benefits).
                 (ii) The large group market (other than coverage that consists
                solely of excepted benefits).
                 (iii) The small group market (other than coverage that consists
                solely of excepted benefits).
                 (iv) In the case of a self-insured group health plan, all self-
                insured group health plans (other than account-based plans, as defined
                in Sec. 54.9815-2711(d)(6)(i), and plans that consist solely of
                excepted benefits) of the same plan sponsor, or at the option of the
                plan sponsor, all self-insured group health plans administered by the
                same entity (including a third-party administrator contracted by the
                plan), to the extent otherwise permitted by law, that is responsible
                for calculating the qualifying payment amount on behalf of the plan.
                 (9) Modifiers mean codes applied to the service code that provide a
                more specific description of the furnished item or service and that may
                adjust the payment rate or affect the processing or payment of the code
                billed.
                 (10) Newly covered item or service means an item or service for
                which coverage was not offered in 2019 under a group health plan, but
                that is offered under the plan in a year after 2019.
                 (11) New service code means a service code that was created or
                substantially revised in a year after 2019.
                 (12) Provider in the same or similar specialty means the practice
                specialty of a provider, as identified by the plan consistent with the
                plan's usual business practice, except that, with respect to air
                ambulance services, all providers of air ambulance services are
                considered to be a single provider specialty.
                 (13) Same or similar item or service means a health care item or
                service billed under the same service code, or a comparable code under
                a different procedural code system.
                 (14) Service code means the code that describes an item or service
                using the Current Procedural Terminology (CPT) code, Healthcare Common
                Procedure Coding System (HCPCS), or Diagnosis-Related Group (DRG)
                codes.
                 (15) Sufficient information means, for purposes of determining
                whether a group health plan has sufficient information to calculate the
                median of the contracted rates described in paragraph (b) of this
                section--
                 (i) The plan has at least three contracted rates on January 31,
                2019, to calculate the median of the contracted rates in accordance
                with paragraph (b) of this section; or
                 (ii) For an item or service furnished during a year after 2022 that
                is used to determine the first sufficient information year--
                 (A) The plan has at least three contracted rates on January 31 of
                the year immediately preceding that year to calculate the median of the
                contracted rates in accordance with paragraph (b) of this section; and
                 (B) The contracted rates under paragraph (a)(15)(ii)(A) of this
                section account (or are reasonably expected to account) for at least 25
                percent of the total number of claims paid for that item or service for
                that year with respect to all plans of the sponsor (or the
                administering entity as provided in paragraph (a)(8)(iv) of this
                section, if applicable) that are offered in the same insurance market.
                 (16) Qualifying payment amount means, with respect to a sponsor of
                a group health plan, the amount calculated using the methodology
                described in paragraph (c) of this section.
                 (17) Underlying fee schedule rate means the rate for a covered item
                or service from a particular participating provider, providers, or
                facility that a group health plan uses to determine a participant's or
                beneficiary's cost-sharing liability for the item or service, when that
                rate is different from the contracted rate.
                 (b) Methodology for calculation of median contracted rate--(1) In
                general. The median contracted rate for an item or service is
                calculated by arranging in order from least to greatest the contracted
                rates of all group health plans of the plan sponsor (or the
                administering entity as provided in paragraph (a)(8)(iv) of this
                section, if applicable) in the same insurance market for the same or
                similar item or service that is provided by a provider in the same or
                similar specialty or facility of the same or similar facility type and
                provided in the geographic region in which the item or service is
                furnished and selecting the middle number. If there are an even number
                of contracted rates, the median contracted rate is the average of the
                middle two contracted rates. In determining the median contracted rate,
                the amount negotiated under each contract is treated as a separate
                amount. If a plan or issuer has a contract with a provider group or
                facility, the rate negotiated with that provider group or facility
                under the contract is treated as a single contracted rate if the same
                amount applies with respect to all providers of such provider group or
                facility under the single contract. However, if a plan or issuer has a
                contract with multiple providers, with separate negotiated rates with
                each particular provider, each unique contracted rate with an
                individual provider constitutes a single contracted rate. Further, if a
                plan or issuer has separate contracts with individual providers, the
                contracted rate under each such contract constitutes a single
                contracted rate (even if the same amount is paid to multiple providers
                under separate contracts).
                 (2) Calculation rules. In calculating the median contracted rate, a
                plan must:
                 (i) Calculate the median contracted rate with respect to all plans
                of such sponsor (or the administering entity as provided in paragraph
                (a)(8)(iv) of this section, if applicable) that are offered in the same
                insurance market;
                 (ii) Calculate the median contracted rate using the full contracted
                rate applicable to the service code, except that the plan must--
                 (A) Calculate separate median contracted rates for CPT code
                modifiers
                [[Page 36955]]
                ``26'' (professional component) and ``TC'' (technical component);
                 (B) For anesthesia services, calculate a median contracted rate for
                the anesthesia conversion factor for each service code;
                 (C) For air ambulance services, calculate a median contracted rate
                for the air mileage service codes (A0435 and A0436); and
                 (D) Where contracted rates otherwise vary based on applying a
                modifier code, calculate a separate median contracted rate for each
                such service code-modifier combination;
                 (iii) In the case of payments made by a plan that are not on a fee-
                for-service basis (such as bundled or capitation payments), calculate a
                median contracted rate for each item or service using the underlying
                fee schedule rates for the relevant items or services. If the plan does
                not have an underlying fee schedule rate for the item or service, it
                must use the derived amount to calculate the median contracted rate;
                and
                 (iv) Exclude risk sharing, bonus, penalty, or other incentive-based
                or retrospective payments or payment adjustments.
                 (3) Provider specialties; facility types. (i) If a plan has
                contracted rates that vary based on provider specialty for a service
                code, the median contracted rate is calculated separately for each
                provider specialty, as applicable.
                 (ii) If a plan has contracted rates for emergency services that
                vary based on facility type for a service code, the median contracted
                rate is calculated separately for each facility of the same or similar
                facility type.
                 (c) Methodology for calculation of the qualifying payment amount--
                (1) In general. (i) For an item or service (other than items or
                services described in paragraphs (c)(1)(iii) through (vii) of this
                section) furnished during 2022, the plan must calculate the qualifying
                payment amount by increasing the median contracted rate (as determined
                in accordance with paragraph (b) of this section) for the same or
                similar item or service under such plans, on January 31, 2019, by the
                combined percentage increase as published by the Department of the
                Treasury and the Internal Revenue Service to reflect the percentage
                increase in the CPI-U over 2019, such percentage increase over 2020,
                and such percentage increase over 2021.
                 (A) The combined percentage increase for 2019, 2020, and 2021 will
                be published in guidance by the Internal Revenue Service. The
                Department of the Treasury and the Internal Revenue Service will
                calculate the percentage increase using the CPI-U published by the
                Bureau of Labor Statistics of the Department of Labor.
                 (B) For purposes of this paragraph (c)(1)(i), the CPI-U for each
                calendar year is the average of the CPI-U as of the close of the 12-
                month period ending on August 31 of the calendar year, rounded to 10
                decimal places.
                 (C) The combined percentage increase for 2019, 2020, and 2021 will
                be calculated as:
                (CPI-U 2019/CPI-U 2018) x (CPI-U 2020/CPI-U 2019) x (CPI-U 2021/CPI-U
                2020)
                 (ii) For an item or service (other than items or services described
                in paragraphs (c)(1)(iii) through (vii) of this section) furnished
                during 2023 or a subsequent year, the plan must calculate the
                qualifying payment amount by increasing the qualifying payment amount
                determined under paragraph (c)(1)(i) of this section, for such an item
                or service furnished in the immediately preceding year, by the
                percentage increase as published by the Department of the Treasury and
                the Internal Revenue Service.
                 (A) The percentage increase for any year after 2022 will be
                published in guidance by the Internal Revenue Service. The Department
                of the Treasury and Internal Revenue Service will calculate the
                percentage increase using the CPI-U published by the Bureau of Labor
                Statistics of the Department of Labor.
                 (B) For purposes of this paragraph (c)(1)(ii), the CPI-U for each
                calendar year is the average of the CPI-U as of the close of the 12-
                month period ending on August 31 of the calendar year, rounded to 10
                decimal places.
                 (C) The combined percentage increase for any year will be
                calculated as CPI-U present year/CPI-U prior year.
                 (iii) For anesthesia services furnished during 2022, the plan must
                calculate the qualifying payment amount by first increasing the median
                contracted rate for the anesthesia conversion factor (as determined in
                accordance with paragraph (b) of this section) for the same or similar
                item or service under such plans, on January 31, 2019, in accordance
                with paragraph (c)(1)(i) of this section (referred to in this section
                as the indexed median contracted rate for the anesthesia conversion
                factor). The plan must then multiply the indexed median contracted rate
                for the anesthesia conversion factor by the sum of the base unit, time
                unit, and physical status modifier units of the participant or
                beneficiary to whom anesthesia services are furnished to determine the
                qualifying payment amount.
                 (A) The base units for an anesthesia service code are the base
                units for that service code specified in the most recent edition (as of
                the date of service) of the American Society of Anesthesiologists
                Relative Value Guide.
                 (B) The time unit is measured in 15-minute increments or a fraction
                thereof.
                 (C) The physical status modifier on a claim is a standard modifier
                describing the physical status of the patient and is used to
                distinguish between various levels of complexity of the anesthesia
                services provided, and is expressed as a unit with a value between zero
                (0) and three (3).
                 (D) The anesthesia conversion factor is expressed in dollars per
                unit and is a contracted rate negotiated with the plan.
                 (iv) For anesthesia services furnished during 2023 or a subsequent
                year, the plan must calculate the qualifying payment amount by first
                increasing the indexed median contracted rate for the anesthesia
                conversion factor, determined under paragraph (c)(1)(iii) of this
                section for such services furnished in the immediately preceding year,
                in accordance with paragraph (c)(1)(ii) of this section. The plan must
                then multiply that amount by the sum of the base unit, time unit, and
                physical status modifier units for the participant or beneficiary to
                whom anesthesia services are furnished to determine the qualifying
                payment amount.
                 (v) For air ambulance services billed using the air mileage service
                codes (A0435 and A0436) that are furnished during 2022, the plan must
                calculate the qualifying payment amount for services billed using the
                air mileage service codes by first increasing the median contracted
                rate (as determined in accordance with paragraph (b) of this section),
                in accordance with paragraph (c)(1)(i) of this section (referred to in
                this section as the indexed median air mileage rate). The plan must
                then multiply the indexed median air mileage rate by the number of
                loaded miles provided to the participant or beneficiary to determine
                the qualifying payment amount.
                 (A) The air mileage rate is expressed in dollars per loaded mile
                flown, is expressed in statute miles (not nautical miles), and is a
                contracted rate negotiated with the plan.
                 (B) The number of loaded miles is the number of miles a patient is
                transported in the air ambulance vehicle.
                 (C) The qualifying payment amount for other service codes
                associated with air ambulance services is calculated in accordance with
                paragraphs (c)(1)(i) and (ii) of this section.
                [[Page 36956]]
                 (vi) For air ambulance services billed using the air mileage
                service codes (A0435 and A0436) that are furnished during 2023 or a
                subsequent year, the plan must calculate the qualifying payment amount
                by first increasing the indexed median air mileage rate, determined
                under paragraph (c)(1)(v) of this section for such services furnished
                in the immediately preceding year, in accordance with paragraph
                (c)(1)(ii) of this section. The plan must then multiply the indexed
                median air mileage rate by the number of loaded miles provided to the
                participant or beneficiary to determine the qualifying payment amount.
                 (vii) For any other items or services for which a plan generally
                determines payment for the same or similar items or services by
                multiplying a contracted rate by another unit value, the plan must
                calculate the qualifying payment amount using a methodology that is
                similar to the methodology required under paragraphs (c)(1)(iii)
                through (vi) of this section and reasonably reflects the payment
                methodology for same or similar items or services.
                 (2) New plans. With respect to a sponsor of a group health plan in
                a geographic region in which the sponsor did not offer any group health
                plan during 2019--
                 (i) For the first year in which the group health plan is offered in
                such region--
                 (A) If the plan has sufficient information to calculate the median
                of the contracted rates described in paragraph (b) of this section, the
                plan must calculate the qualifying payment amount in accordance with
                paragraph (c)(1) of this section for items and services that are
                covered by the plan and furnished during the first year; and
                 (B) If the plan does not have sufficient information to calculate
                the median of the contracted rates described in paragraph (b) of this
                section for an item or service provided in a geographic region, the
                plan must determine the qualifying payment amount for the item or
                service in accordance with paragraph (c)(3)(i) of this section.
                 (ii) For each subsequent year the group health plan is offered in
                the region, the plan must calculate the qualifying payment amount by
                increasing the qualifying payment amount determined under this
                paragraph (c)(2) for the items and services furnished in the
                immediately preceding year, in accordance with paragraph (c)(1)(ii),
                (iv), or (vi) of this section, as applicable.
                 (3) Insufficient information; newly covered items and services. In
                the case of a plan that does not have sufficient information to
                calculate the median of the contracted rates described in paragraph (b)
                of this section in 2019 (or, in the case of a newly covered item or
                service, in the first coverage year for such item or service with
                respect to such plan or coverage if the plan does not have sufficient
                information) for an item or service provided in a geographic region--
                 (i) For an item or service furnished during 2022 (or, in the case
                of a newly covered item or service, during the first coverage year for
                the item or service with respect to the plan or coverage), the plan
                must calculate the qualifying payment amount by first identifying the
                rate that is equal to the median of the in-network allowed amounts for
                the same or similar item or service provided in the geographic region
                in the year immediately preceding the year in which the item or service
                is furnished (or, in the case of a newly covered item or service, the
                year immediately preceding such first coverage year) determined by the
                plan through use of any eligible database, and then increasing that
                rate by the percentage increase in the CPI-U over such preceding year.
                For purposes of this section, in cases in which an eligible database is
                used to determine the qualifying payment amount with respect to an item
                or service furnished during a calendar year, the plan must use the same
                database for determining the qualifying payment amount for that item or
                service furnished through the last day of the calendar year, and if a
                different database is selected for some items or services, the basis
                for that selection must be one or more factors not directly related to
                the rate of those items or services (such as sufficiency of data for
                those items or services).
                 (ii) For an item or service furnished in a subsequent year (before
                the first sufficient information year for such item or service with
                respect to such plan), the plan must calculate the qualifying payment
                amount by increasing the qualifying payment amount determined under
                paragraph (c)(3)(i) of this section or this paragraph (c)(3)(ii), as
                applicable, for such item or service for the year immediately preceding
                such subsequent year, by the percentage increase in CPI-U over such
                preceding year;
                 (iii) For an item or service furnished in the first sufficient
                information year for such item or service with respect to such plan,
                the plan must calculate the qualifying payment amount in accordance
                with paragraph (c)(1)(i), (iii), or (v) of this section, as applicable,
                except that in applying such paragraph to such item or service, the
                reference to `furnished during 2022' is treated as a reference to
                furnished during such first sufficient information year, the reference
                to `in 2019' is treated as a reference to such sufficient information
                year, and the increase described in such paragraph is not applied; and
                 (iv) For an item or service furnished in any year subsequent to the
                first sufficient information year for such item or service with respect
                to such plan, the plan must calculate the qualifying payment amount in
                accordance with paragraph (c)(1)(ii), (iv), or (vi) of this section, as
                applicable, except that in applying such paragraph to such item or
                service, the reference to `furnished during 2023 or a subsequent year'
                is treated as a reference to furnished during the year after such first
                sufficient information year or a subsequent year.
                 (4) New service codes. In the case of a plan that does not have
                sufficient information to calculate the median of the contracted rates
                described in paragraph (b) of this section and determine the qualifying
                payment amount under paragraphs (c)(1) through (3) of this section
                because the item or service furnished is billed under a new service
                code--
                 (i) For an item or service furnished during 2022 (or, in the case
                of a newly covered item or service, during the first coverage year for
                the item or service with respect to the plan), the plan must identify a
                reasonably related service code that existed in the immediately
                preceding year and--
                 (A) If the Centers for Medicare & Medicaid Services has established
                a Medicare payment rate for the item or service billed under the new
                service code, the plan must calculate the qualifying payment amount by
                first calculating the ratio of the rate that Medicare pays for the item
                or service billed under the new service code compared to the rate that
                Medicare pays for the item or service billed under the related service
                code, and then multiplying the ratio by the qualifying payment amount
                for an item or service billed under the related service code for the
                year in which the item or service is furnished.
                 (B) If the Centers for Medicare & Medicaid Services has not
                established a Medicare payment rate for the item or service billed
                under the new service code, the plan must calculate the qualifying
                payment amount by first calculating the ratio of the rate that the plan
                reimburses for the item or service billed under the new service code
                compared to the rate that the plan reimburses for the item or service
                billed under the related service code, and then multiplying the ratio
                by the qualifying
                [[Page 36957]]
                payment amount for an item or service billed under the related service
                code.
                 (ii) For an item or service furnished in a subsequent year (before
                the first sufficient information year for such item or service with
                respect to such plan or coverage or before the first year for which an
                eligible database has sufficient information to a calculate a rate
                under paragraph (c)(3)(i) of this section in the immediately preceding
                year), the plan must calculate the qualifying payment amount by
                increasing the qualifying payment amount determined under paragraph
                (c)(4)(i) of this section or this paragraph (c)(4)(ii), as applicable,
                for such item or service for the year immediately preceding such
                subsequent year, by the percentage increase in CPI-U over such
                preceding year;
                 (iii) For an item or service furnished in the first sufficient
                information year for such item or service with respect to such plan or
                the first year for which an eligible database has sufficient
                information to calculate a rate under paragraph (c)(3)(i) of this
                section in the immediately preceding year, the plan or issuer must
                calculate the qualifying payment amount in accordance with paragraph
                (c)(3) of this section.
                 (d) Information to be shared about qualifying payment amount. In
                cases in which the recognized amount with respect to an item or service
                furnished by a nonparticipating provider, nonparticipating emergency
                facility, or nonparticipating provider of air ambulance services is the
                qualifying payment amount, the plan must provide in writing, in paper
                or electronic form, to the provider or facility, as applicable--
                 (1) With an initial payment or notice of denial of payment under
                Sec. 54.9816-4T, Sec. 54.9816-5T, or Sec. 54.9817-1T:
                 (i) The qualifying payment amount for each item or service
                involved;
                 (ii) A statement to certify that, based on the determination of the
                plan--
                 (A) The qualifying payment amount applies for purposes of the
                recognized amount (or, in the case of air ambulance services, for
                calculating the participant's, beneficiary's, or enrollee's cost
                sharing); and
                 (B) Each qualifying payment amount shared with the provider or
                facility was determined in compliance with this section;
                 (iii) A statement that if the provider or facility, as applicable,
                wishes to initiate a 30-day open negotiation period for purposes of
                determining the amount of total payment, the provider or facility may
                contact the appropriate person or office to initiate open negotiation,
                and that if the 30-day negotiation period does not result in a
                determination, generally, the provider or facility may initiate the
                independent dispute resolution process within 4 days after the end of
                the open negotiation period; and
                 (iv) 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 such item or service.
                 (2) In a timely manner upon request of the provider or facility:
                 (i) Information about whether the qualifying payment amount for
                items and services involved included contracted rates that were not on
                a fee-for-service basis for those specific items and services and
                whether the qualifying payment amount for those items and services was
                determined using underlying fee schedule rates or a derived amount;
                 (ii) If a plan uses an eligible database under paragraph (c)(3) of
                this section to determine the qualifying payment amount, information to
                identify which database was used; and
                 (iii) If a related service code was used to determine the
                qualifying payment amount for an item or service billed under a new
                service code under paragraph (c)(4)(i) or (ii) of this section,
                information to identify the related service code; and
                 (iv) If applicable, a statement that the plan's contracted rates
                include risk-sharing, bonus, penalty, or other incentive-based or
                retrospective payments or payment adjustments for the items and
                services involved (as applicable) that were excluded for purposes of
                calculating the qualifying payment amount.
                 (e) Certain access fees to databases. In the case of a plan that,
                pursuant to this section, uses an eligible database to determine the
                qualifying payment amount for an item or service, the plan is
                responsible for any costs associated with accessing such database.
                 (f) Audits. See 45 CFR 149.140(f) for audit procedures that apply
                with respect to ensuring that a plan is in compliance with the
                requirement of applying a qualifying payment amount under Sec. Sec.
                54.9816-4T, 54.9816-5T, 54.9817-1T, and this section, and ensuring that
                such amount so applied satisfies the requirements under this section,
                as applicable.
                 (g) Applicability date. The provisions of this section are
                applicable with respect to plan years beginning on or after January 1,
                2022.
                Sec. 54.9816-7T Complaints process for surprise medical bills
                regarding group health plans (temporary).
                 See 45 CFR 149.150 for the process to receive and resolve
                complaints that a specific group health plan may be failing to meet the
                requirement of applying a qualifying payment amount under Sec. Sec.
                54.9816-4T, 54.9816-5T, 54.9816-6T, and 54.9817-1T, which may warrant
                an investigation.
                Sec. 54.9817-1T Preventing surprise medical bills for air ambulance
                services (temporary).
                 (a) In general. If a group health plan provides or covers any
                benefits for air ambulance services, the plan must cover such services
                from a nonparticipating provider of air ambulance services in
                accordance with paragraph (b) of this section.
                 (b) Coverage requirements. A plan described in paragraph (a) of
                this section must provide coverage of air ambulance services in the
                following manner--
                 (1) The cost-sharing requirements with respect to the services must
                be the same requirements that would apply if the services were provided
                by a participating provider of air ambulance services.
                 (2) The cost-sharing requirement must be calculated as if the total
                amount that would have been charged for the services by a participating
                provider of air ambulance services were equal to the lesser of the
                qualifying payment amount (as determined in accordance with Sec.
                54.9816-6T) or the billed amount for the services.
                 (3) The cost-sharing amounts must be counted towards any in-network
                deductible and in-network out-of-pocket maximums (including the annual
                limitation on cost sharing under section 2707(b) of the Public Health
                Service Act) (as applicable) applied under the plan (and the in-network
                deductible and out-of-pocket maximums must be applied) in the same
                manner as if the cost-sharing payments were made with respect to
                services furnished by a participating provider of air ambulance
                services.
                 (4) The plan must--
                 (i) Not later than 30 calendar days after the bill for the services
                is transmitted by the provider of air ambulance services, determine
                whether the services are covered under the plan and, if the services
                are covered, send to the provider an initial payment or a notice of
                denial of payment. For purposes of this paragraph (b)(4)(i), the 30-
                calendar-day period begins on the date the plan receives the
                information necessary to decide a claim for payment for the services.
                [[Page 36958]]
                 (ii) Pay a total plan payment directly to the nonparticipating
                provider furnishing such air ambulance services that is equal to the
                amount by which the out-of-network rate for the services exceeds the
                cost-sharing amount for the services (as determined in accordance with
                paragraphs (b)(1) and (2) of this section), less any initial payment
                amount made under paragraph (b)(4)(i) of this section. The total plan
                payment must be made in accordance with the timing requirement
                described in section 9817(b)(6), or in cases where the out-of-network
                rate is determined under a specified State law or All-Payer Model
                Agreement, such other timeframe as specified by the State law or All-
                Payer Model Agreement.
                 (c) Applicability date. The provisions of this section are
                applicable with respect to plan years beginning on or after January 1,
                2022.
                Sec. 54.9822-1T Choice of health care professional (temporary).
                 (a) Choice of health care professional--(1) Designation of primary
                care provider--(i) In general. If a group health plan, requires or
                provides for designation by a participant or beneficiary of a
                participating primary care provider, then the plan must permit each
                participant or beneficiary to designate any participating primary care
                provider who is available to accept the participant or beneficiary. In
                such a case, the plan must comply with the rules of paragraph (a)(4) of
                this section by informing each participant of the terms of the plan
                regarding designation of a primary care provider.
                 (ii) Construction. Nothing in paragraph (a)(1)(i) of this section
                is to be construed to prohibit the application of reasonable and
                appropriate geographic limitations with respect to the selection of
                primary care providers, in accordance with the terms of the plan, the
                underlying provider contracts, and applicable State law.
                 (iii) Example. The rules of this paragraph (a)(1) are illustrated
                by the following example:
                 (A) Facts. A group health plan requires individuals covered under
                the plan to designate a primary care provider. The plan permits each
                individual to designate any primary care provider participating in the
                plan's network who is available to accept the individual as the
                individual's primary care provider. If an individual has not designated
                a primary care provider, the plan designates one until the individual
                has made a designation. The plan provides a notice that satisfies the
                requirements of paragraph (a)(4) of this section regarding the ability
                to designate a primary care provider.
                 (B) Conclusion. In this Example, the plan has satisfied the
                requirements of this paragraph (a).
                 (2) Designation of pediatrician as primary care provider--(i) In
                general. If a group health plan requires or provides for the
                designation of a participating primary care provider for a child by a
                participant or beneficiary, the plan must permit the participant or
                beneficiary to designate a physician (allopathic or osteopathic) who
                specializes in pediatrics (including pediatric subspecialties, based on
                the scope of that provider's license under applicable State law) as the
                child's primary care provider if the provider participates in the
                network of the plan and is available to accept the child. In such a
                case, the plan must comply with the rules of paragraph (a)(4) of this
                section by informing each participant of the terms of the plan
                regarding designation of a pediatrician as the child's primary care
                provider.
                 (ii) Construction. Nothing in paragraph (a)(2)(i) of this section
                is to be construed to waive any exclusions of coverage under the terms
                and conditions of the plan with respect to coverage of pediatric care.
                 (iii) Examples. The rules of this paragraph (a)(2) are illustrated
                by the following examples:
                 (A) Example 1--(1) Facts. A group health plan's HMO designates for
                each participant a physician who specializes in internal medicine to
                serve as the primary care provider for the participant and any
                beneficiaries. Participant A requests that Pediatrician B be designated
                as the primary care provider for A's child. B is a participating
                provider in the HMO's network and is available to accept the child.
                 (2) Conclusion. In this Example 1, the HMO must permit A's
                designation of B as the primary care provider for A's child in order to
                comply with the requirements of this paragraph (a)(2).
                 (B) Example 2--(1) Facts. Same facts as Example 1 (paragraph
                (a)(2)(iii)(A) of this section), except that A takes A's child to B for
                treatment of the child's severe shellfish allergies. B wishes to refer
                A's child to an allergist for treatment. The HMO, however, does not
                provide coverage for treatment of food allergies, nor does it have an
                allergist participating in its network, and it therefore refuses to
                authorize the referral.
                 (2) Conclusion. In this Example 2, the HMO has not violated the
                requirements of this paragraph (a)(2) because the exclusion of
                treatment for food allergies is in accordance with the terms of A's
                coverage.
                 (3) Patient access to obstetrical and gynecological care--(i)
                General rights--(A) Direct access. A group health plan described in
                paragraph (a)(3)(ii) of this section, may not require authorization or
                referral by the plan, or any person (including a primary care provider)
                in the case of a female participant or beneficiary who seeks coverage
                for obstetrical or gynecological care provided by a participating
                health care professional who specializes in obstetrics or gynecology.
                In such a case, the plan must comply with the rules of paragraph (a)(4)
                of this section by informing each participant that the plan may not
                require authorization or referral for obstetrical or gynecological care
                by a participating health care professional who specializes in
                obstetrics or gynecology. The plan may require such a professional to
                agree to otherwise adhere to the plan's policies and procedures,
                including procedures regarding referrals and obtaining prior
                authorization and providing services pursuant to a treatment plan (if
                any) approved by the plan. For purposes of this paragraph (a)(3), a
                health care professional who specializes in obstetrics or gynecology is
                any individual (including a person other than a physician) who is
                authorized under applicable State law to provide obstetrical or
                gynecological care.
                 (B) Obstetrical and gynecological care. A group health plan
                described in paragraph (a)(3)(ii) of this section must treat the
                provision of obstetrical and gynecological care, and the ordering of
                related obstetrical and gynecological items and services, pursuant to
                the direct access described under paragraph (a)(3)(i)(A) of this
                section, by a participating health care professional who specializes in
                obstetrics or gynecology as the authorization of the primary care
                provider.
                 (ii) Application of paragraph. A group health plan is described in
                this paragraph (a)(3) if the plan--
                 (A) Provides coverage for obstetrical or gynecological care; and
                 (B) Requires the designation by a participant or beneficiary of a
                participating primary care provider.
                 (iii) Construction. Nothing in paragraph (a)(3)(i) of this section
                is to be construed to--
                 (A) Waive any exclusions of coverage under the terms and conditions
                of the plan with respect to coverage of obstetrical or gynecological
                care; or
                 (B) Preclude the group health plan involved from requiring that the
                obstetrical or gynecological provider notify the primary care health
                care
                [[Page 36959]]
                professional or the plan of treatment decisions.
                 (iv) Examples. The rules of this paragraph (a)(3) are illustrated
                by the following examples:
                 (A) Example 1--(1) Facts. A group health plan requires each
                participant to designate a physician to serve as the primary care
                provider for the participant and the participant's family. Participant
                A, a female, requests a gynecological exam with Physician B, an in-
                network physician specializing in gynecological care. The group health
                plan requires prior authorization from A's designated primary care
                provider for the gynecological exam.
                 (2) Conclusion. In this Example 1, the group health plan has
                violated the requirements of this paragraph (a)(3) because the plan
                requires prior authorization from A's primary care provider prior to
                obtaining gynecological services.
                 (B) Example 2--(1) Facts. Same facts as Example 1 (paragraph
                (a)(3)(iv)(A) of this section) except that A seeks gynecological
                services from C, an out-of-network provider.
                 (2) Conclusion. In this Example 2, the group health plan has not
                violated the requirements of this paragraph (a)(3) by requiring prior
                authorization because C is not a participating health care provider.
                 (C) Example 3--(1) Facts. Same facts as Example 1 (paragraph
                (a)(3)(iv)(A) of this section) except that the group health plan only
                requires B to inform A's designated primary care physician of treatment
                decisions.
                 (2) Conclusion. In this Example 3, the group health plan has not
                violated the requirements of this paragraph (a)(3) because A has direct
                access to B without prior authorization. The fact that the group health
                plan requires the designated primary care physician to be notified of
                treatment decisions does not violate this paragraph (a)(3).
                 (D) Example 4--(1) Facts. A group health plan requires each
                participant to designate a physician to serve as the primary care
                provider for the participant and the participant's family. The group
                health plan requires prior authorization before providing benefits for
                uterine fibroid embolization.
                 (2) Conclusion. In this Example 4, the plan requirement for prior
                authorization before providing benefits for uterine fibroid
                embolization does not violate the requirements of this paragraph (a)(3)
                because, though the prior authorization requirement applies to
                obstetrical services, it does not restrict access to any providers
                specializing in obstetrics or gynecology.
                 (4) Notice of right to designate a primary care provider--(i) In
                general. If a group health plan requires the designation by a
                participant or beneficiary of a primary care provider, the plan must
                provide a notice informing each participant of the terms of the plan
                regarding designation of a primary care provider and of the rights--
                 (A) Under paragraph (a)(1)(i) of this section, that any
                participating primary care provider who is available to accept the
                participant or beneficiary can be designated;
                 (B) Under paragraph (a)(2)(i) of this section, with respect to a
                child, that any participating physician who specializes in pediatrics
                can be designated as the primary care provider; and
                 (C) Under paragraph (a)(3)(i) of this section, that the plan may
                not require authorization or referral for obstetrical or gynecological
                care by a participating health care professional who specializes in
                obstetrics or gynecology.
                 (ii) Timing. In the case of a group health plan, the notice
                described in paragraph (a)(4)(i) of this section must be included
                whenever the plan provides a participant with a summary plan
                description or other similar description of benefits under the plan.
                 (iii) Model language. The following model language can be used to
                satisfy the notice requirement described in paragraph (a)(4)(i) of this
                section:
                 (A) For plans that require or allow for the designation of primary
                care providers by participants or beneficiaries, insert:
                 [Name of group health plan] generally [requires/allows] the
                designation of a primary care provider. You have the right to
                designate any primary care provider who participates in our network
                and who is available to accept you or your family members. [If the
                plan designates a primary care provider automatically, insert: Until
                you make this designation, [name of group health plan] designates
                one for you.] For information on how to select a primary care
                provider, and for a list of the participating primary care
                providers, contact the [plan administrator] at [insert contact
                information].
                 (B) For plans that require or allow for the designation of a
                primary care provider for a child, add:
                 For children, you may designate a pediatrician as the primary care
                provider.
                 (C) For plans that provide coverage for obstetric or gynecological
                care and require the designation by a participant or beneficiary of a
                primary care provider, add:
                 You do not need prior authorization from [name of group health
                plan] or from any other person (including a primary care provider)
                in order to obtain access to obstetrical or gynecological care from
                a health care professional in our network who specializes in
                obstetrics or gynecology. The health care professional, however, may
                be required to comply with certain procedures, including obtaining
                prior authorization for certain services, following a pre-approved
                treatment plan, or procedures for making referrals. For a list of
                participating health care professionals who specialize in obstetrics
                or gynecology, contact the [plan administrator] at [insert contact
                information].
                 (b) Applicability date. The provisions of this section are
                applicable with respect to plan years beginning on or after January 1,
                2022.
                Department of Labor
                Employee Benefits Security Administration
                29 CFR Chapter XXV
                 For the reasons set forth in the preamble, the Department of Labor
                amends 29 CFR part 2590 as set forth below:
                PART 2590--RULES AND REGULATIONS FOR GROUP HEALTH PLANS.
                0
                9. The authority citation for part 2590 is revised to read as follows:
                 Authority: 29 U.S.C. 1027, 1059, 1135, 1161-1168, 1169, 1181-
                1183, 1181 note, 1185, 1185a-n, 1191, 1191a, 1191b, and 1191c; sec.
                101(g), Pub. L.104-191, 110 Stat. 1936; sec. 401(b), Pub. L. 105-
                200, 112 Stat. 645 (42 U.S.C. 651 note); sec. 512(d), Pub. L. 110-
                343, 122 Stat. 3881; sec. 1001, 1201, and 1562(e), Pub. L. 111-148,
                124 Stat. 119, as amended by Pub. L. 111-152, 124 Stat. 1029;
                Division M, Pub. L. 113-235, 128 Stat. 2130; Pub. L. 116-260 134
                Stat. 1182; Secretary of Labor's Order 1-2011, 77 FR 1088 (Jan. 9,
                2012).
                0
                10. Section 2590.715-2719A is amended by revising paragraph (c) to read
                as follows:
                Sec. 2590.715-2719A Patient protections.
                * * * * *
                 (c) Applicability date. The provisions of this section are
                applicable to group health plans and health insurance issuers for plan
                years beginning before January 1, 2022. See also Sec. Sec. 2590.716-4
                through 2590.716-7, 2590.717-1, and 2590.722 of this part for rules
                applicable with respect to plan years beginning on or after January 1,
                2022.
                Subpart D [Redesignated as Subpart E]
                0
                11. Redesignate subpart D as subpart E and add a new subpart D to read
                as follows:
                [[Page 36960]]
                Subpart D--Surprise Billing and Transparency Requirements
                Sec.
                2590.716-1 Basis and scope.
                2590.716-2 Applicability.
                2590.716-3 Definitions.
                2590.716-4 Preventing surprise medical bills for emergency services.
                2590.716-5 Preventing surprise medical bills for non-emergency
                services performed by nonparticipating providers at certain
                participating facilities.
                2590.716-6 Methodology for calculating qualifying payment amount.
                2590.716-7 Complaints process for surprise medical bills regarding
                group health plans and group health insurance coverage.
                2590.717-1 Preventing surprise medical bills for air ambulance
                services.
                2590.722 Choice of health care professional.
                Subpart D--Surprise Billing and Transparency Requirements
                Sec. 2590.716-1 Basis and scope.
                 (a) Basis. Sections 2590.716-1 through 2590.722 implement section
                716-722 of ERISA.
                 (b) Scope. This part establishes standards for group health plans
                and health insurance issuers offering group health insurance coverage
                with respect to surprise medical bills, transparency in health care
                coverage, and additional patient protections.
                Sec. 2590.716-2 Applicability.
                 (a) In general. The requirements in Sec. Sec. 2590.716-4 through
                2590.716-7, 2590.717-1, and 2590.722 apply to group health plans and
                health insurance issuers offering group health insurance coverage
                (including grandfathered health plans as defined in Sec. 2590.715-
                1251), except as specified in paragraph (b) of this section.
                 (b) Exceptions. The requirements in Sec. Sec. 2590.716-4 through
                2590.716-7, 2590.717-1, and 2590.722 do not apply to the following:
                 (1) Excepted benefits as described in Sec. 2590.732.
                 (2) Short-term, limited-duration insurance as defined in Sec.
                2590.701-2.
                 (3) Health reimbursement arrangements or other account-based group
                health plans as described in Sec. 2590.715-2711(d).
                Sec. 2590.716-3 Definitions.
                 The definitions in this part apply to Sec. Sec. 2590.716 through
                2590.722, unless otherwise specified. In addition, for purposes of
                Sec. Sec. 2590.716 through 2590.722, the following definitions apply:
                 Air ambulance service means medical transport by a rotary wing air
                ambulance, as defined in 42 CFR 414.605, or fixed wing air ambulance,
                as defined in 42 CFR 414.605, for patients.
                 Cost sharing means the amount a participant or beneficiary is
                responsible for paying for a covered item or service under the terms of
                the group health plan or health insurance coverage. Cost sharing
                generally includes copayments, coinsurance, and amounts paid towards
                deductibles, but does not include amounts paid towards premiums,
                balance billing by out-of-network providers, or the cost of items or
                services that are not covered under a group health plan or health
                insurance coverage.
                 Emergency department of a hospital includes a hospital outpatient
                department that provides emergency services.
                 Emergency medical condition has the meaning given the term in Sec.
                2590.716-4(c)(1).
                 Emergency services has the meaning given the term in Sec.
                2590.716-4(c)(2).
                 Health care facility, with respect to a group health plan or group
                health insurance coverage, in the context of non-emergency services, is
                each of the following:
                 (1) A hospital (as defined in section 1861(e) of the Social
                Security Act);
                 (2) A hospital outpatient department;
                 (3) A critical access hospital (as defined in section 1861(mm)(1)
                of the Social Security Act); and
                 (4) An ambulatory surgical center described in section
                1833(i)(1)(A) of the Social Security Act.
                 Independent freestanding emergency department means a health care
                facility (not limited to those described in the definition of health
                care facility with respect to non-emergency services) that--
                 (1) Is geographically separate and distinct and licensed separately
                from a hospital under applicable State law; and
                 (2) Provides any emergency services as described in Sec. 2590.716-
                4(c)(2)(i).
                 Nonparticipating emergency facility means an emergency department
                of a hospital, or an independent freestanding emergency department (or
                a hospital, with respect to services that pursuant to Sec. 2590.716-
                4(c)(2)(ii) are included as emergency services), that does not have a
                contractual relationship directly or indirectly with a group health
                plan or group health insurance coverage offered by a health insurance
                issuer, with respect to the furnishing of an item or service under the
                plan or coverage, respectively.
                 Nonparticipating provider means any physician or other health care
                provider who does not have a contractual relationship directly or
                indirectly with a group health plan or group health insurance coverage
                offered by a health insurance issuer, with respect to the furnishing of
                an item or service under the plan or coverage, respectively.
                 Notice of denial of payment means, with respect to an item or
                service for which benefits subject to the protections of Sec. Sec.
                2590.716-4, 2590.716-5, and 2590.717-1 are provided or covered, a
                written notice from the plan or issuer to the health care provider,
                facility, or provider of air ambulance services, as applicable, that
                payment for such item or service will not be made by the plan or
                coverage and which explains the reason for denial. The term notice of
                denial of payment does not include a notice of benefit denial due to an
                adverse benefit determination as defined in Sec. 2560.503-1 of this
                chapter.
                 Out-of-network rate means, with respect to an item or service
                furnished by a nonparticipating provider, nonparticipating emergency
                facility, or nonparticipating provider of air ambulance services--
                 (1) Subject to paragraph (3) of this definition, in a State that
                has in effect a specified State law, the amount determined in
                accordance with such law;
                 (2) Subject to paragraph (3) of this definition, in a State that
                does not have in effect a specified State law--
                 (i) Subject to paragraph (2)(ii) of this definition, if the
                nonparticipating provider or nonparticipating emergency facility and
                the plan or issuer agree on an amount of payment (including if the
                amount agreed upon is the initial payment sent by the plan or issuer
                under 26 CFR 54.9816-4T(b)(3)(iv)(A), 54.9816-5T(c)(3), or 54.9817-
                1T(b)(4)(i); Sec. 2590.716-4(b)(3)(iv)(A), Sec. 2590.716-5(c)(3), or
                Sec. 2590.717-1(b)(4)(i); or 45 CFR 149.110(b)(3)(iv)(A),
                149.120(c)(3), or 149.130(b)(4)(i), as applicable, or is agreed on
                through negotiations with respect to such item or service), such agreed
                on amount; or
                 (ii) If the nonparticipating provider or nonparticipating emergency
                facility and the plan or issuer enter into the independent dispute
                resolution (IDR) process under section 9816(c) or 9817(b) of the
                Internal Revenue Code, section 716(c) or 717(b) of ERISA, or section
                2799A-1(c) or 2799A-2(b) of the PHS Act, as applicable, and do not
                agree before the date on which a certified IDR entity makes a
                determination with respect to such item or service under such
                subsection, the amount of such determination; or
                 (3) In a State that has an All-Payer Model Agreement under section
                1115A of the Social Security Act that applies with respect to the plan
                or issuer; the nonparticipating provider or
                [[Page 36961]]
                nonparticipating emergency facility; and the item or service, the
                amount that the State approves under the All-Payer Model Agreement for
                the item or service.
                 Participating emergency facility means any emergency department of
                a hospital, or an independent freestanding emergency department (or a
                hospital, with respect to services that pursuant to Sec. 2590.716-
                4(c)(2)(ii) are included as emergency services), that has a contractual
                relationship directly or indirectly with a group health plan or health
                insurance issuer offering group health insurance coverage setting forth
                the terms and conditions on which a relevant item or service is
                provided to a participant or beneficiary under the plan or coverage,
                respectively. A single case agreement between an emergency facility and
                a plan or issuer that is used to address unique situations in which a
                participant or beneficiary requires services that typically occur out-
                of-network constitutes a contractual relationship for purposes of this
                definition, and is limited to the parties to the agreement.
                 Participating health care facility means any health care facility
                described in this section that has a contractual relationship directly
                or indirectly with a group health plan or health insurance issuer
                offering group health insurance coverage setting forth the terms and
                conditions on which a relevant item or service is provided to a
                participant or beneficiary under the plan or coverage, respectively. A
                single case agreement between a health care facility and a plan or
                issuer that is used to address unique situations in which a participant
                or beneficiary requires services that typically occur out-of-network
                constitutes a contractual relationship for purposes of this definition,
                and is limited to the parties to the agreement.
                 Participating provider means any physician or other health care
                provider who has a contractual relationship directly or indirectly with
                a group health plan or health insurance issuer offering group health
                insurance coverage setting forth the terms and conditions on which a
                relevant item or service is provided to a participant or beneficiary
                under the plan or coverage, respectively.
                 Physician or health care provider means a physician or other health
                care provider who is acting within the scope of practice of that
                provider's license or certification under applicable State law, but
                does not include a provider of air ambulance services.
                 Provider of air ambulance services means an entity that is licensed
                under applicable State and Federal law to provide air ambulance
                services.
                 Same or similar item or service has the meaning given the term in
                Sec. 2590.716-6(a)(13).
                 Service code has the meaning given the term in Sec. 2590.716-
                6(a)(14).
                 Qualifying payment amount has the meaning given the term in Sec.
                2590.716-6(a)(16).
                 Recognized amount means, with respect to an item or service
                furnished by a nonparticipating provider or nonparticipating emergency
                facility--
                 (1) Subject to paragraph (3) of this definition, in a State that
                has in effect a specified State law, the amount determined in
                accordance with such law.
                 (2) Subject to paragraph (3) of this definition, in a State that
                does not have in effect a specified State law, the lesser of--
                 (i) The amount that is the qualifying payment amount (as determined
                in accordance with Sec. 2590.716-6); or
                 (ii) The amount billed by the provider or facility.
                 (3) In a State that has an All-Payer Model Agreement under section
                1115A of the Social Security Act that applies with respect to the plan
                or issuer; the nonparticipating provider or nonparticipating emergency
                facility; and the item or service, the amount that the State approves
                under the All-Payer Model Agreement for the item or service.
                 Specified State law means a State law that provides for a method
                for determining the total amount payable under a group health plan or
                group health insurance coverage offered by a health insurance issuer to
                the extent such State law applies for an item or service furnished by a
                nonparticipating provider or nonparticipating emergency facility
                (including where it applies because the State has allowed a plan that
                is not otherwise subject to applicable State law an opportunity to opt
                in, subject to section 514 of ERISA). A group health plan that opts
                into such a specified State law must do so for all items and services
                to which the specified State law applies and in a manner determined by
                the applicable State authority, and must prominently display in its
                plan materials describing the coverage of out-of-network services a
                statement that the plan has opted into the specified State law,
                identify the relevant State (or States), and include a general
                description of the items and services provided by nonparticipating
                facilities and providers that are covered by the specified State law.
                 State means each of the 50 States, the District of Columbia, Puerto
                Rico, the Virgin Islands, Guam, American Samoa, and the Northern
                Mariana Islands.
                 Treating provider is a physician or health care provider who has
                evaluated the individual.
                 Visit, with respect to items and services furnished to an
                individual at a health care facility, includes, in addition to items
                and services furnished by a provider at the facility, equipment and
                devices, telemedicine services, imaging services, laboratory services,
                and preoperative and postoperative services, regardless of whether the
                provider furnishing such items or services is at the facility.
                Sec. 2590.716-4 Preventing surprise medical bills for emergency
                services.
                 (a) In general. If a group health plan, or a health insurance
                issuer offering group health insurance coverage, provides or covers 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, the plan or issuer must cover
                emergency services, as defined in paragraph (c)(2) of this section, and
                this coverage must be provided in accordance with paragraph (b) of this
                section.
                 (b) Coverage requirements. A plan or issuer described in paragraph
                (a) of this section must provide coverage for emergency services in the
                following manner--
                 (1) Without the need for any prior authorization determination,
                even if the services are provided on an out-of-network basis.
                 (2) Without regard to whether the health care provider furnishing
                the emergency services is a participating provider or a participating
                emergency facility, as applicable, with respect to the services.
                 (3) If the emergency services are provided by a nonparticipating
                provider or a nonparticipating emergency facility--
                 (i) Without imposing any administrative requirement or limitation
                on coverage that is more restrictive than the requirements or
                limitations that apply to emergency services received from
                participating providers and participating emergency facilities.
                 (ii) Without imposing cost-sharing requirements that are greater
                than the requirements that would apply if the services were provided by
                a participating provider or a participating emergency facility.
                 (iii) By calculating the cost-sharing requirement as if the total
                amount that would have been charged for the services by such
                participating provider
                [[Page 36962]]
                or participating emergency facility were equal to the recognized amount
                for such services.
                 (iv) The plan or issuer--
                 (A) Not later than 30 calendar days after the bill for the services
                is transmitted by the provider or facility (or, in cases where the
                recognized amount is determined by a specified State law or All-Payer
                Model Agreement, such other timeframe as specified by the State law or
                All-Payer Model Agreement), determines whether the services are covered
                under the plan or coverage and, if the services are covered, sends to
                the provider or facility, as applicable, an initial payment or a notice
                of denial of payment. For purposes of this paragraph (b)(3)(iv)(A), the
                30-calendar-day period begins on the date the plan or issuer receives
                the information necessary to decide a claim for payment for the
                services.
                 (B) Pays a total plan or coverage payment directly to the
                nonparticipating provider or nonparticipating facility that is equal to
                the amount by which the out-of-network rate for the services exceeds
                the cost-sharing amount for the services (as determined in accordance
                with paragraphs (b)(3)(ii) and (iii) of this section), less any initial
                payment amount made under paragraph (b)(3)(iv)(A) of this section. The
                total plan or coverage payment must be made in accordance with the
                timing requirement described in section 716(c)(6) of ERISA, or in cases
                where the out-of-network rate is determined under a specified State law
                or All-Payer Model Agreement, such other timeframe as specified by the
                State law or All-Payer Model Agreement.
                 (v) By counting any cost-sharing payments made by the participant
                or beneficiary with respect to the emergency services toward any in-
                network deductible or in-network out-of-pocket maximums (including the
                annual limitation on cost sharing under section 2707(b) of the PHS Act)
                (as applicable) applied under the plan or coverage (and the in-network
                deductible and in-network out-of-pocket maximums must be applied) in
                the same manner as if the cost-sharing payments were made with respect
                to emergency services furnished by a participating provider or a
                participating emergency facility.
                 (4) Without limiting what constitutes an emergency medical
                condition (as defined in paragraph (c)(1) of this section) solely on
                the basis of diagnosis codes.
                 (5) Without regard to any other term or condition of the coverage,
                other than--
                 (i) The exclusion or coordination of benefits (to the extent not
                inconsistent with benefits for an emergency medical condition, as
                defined in paragraph (c)(1) of this section).
                 (ii) An affiliation or waiting period (each as defined in Sec.
                2590.701-2).
                 (iii) Applicable cost sharing.
                 (c) Definitions. In this section--
                 (1) Emergency medical condition means a medical condition,
                including a mental health condition or substance use disorder,
                manifesting itself by acute symptoms of sufficient severity (including
                severe pain) such that a prudent layperson, who possesses an average
                knowledge of health and medicine, could reasonably expect the absence
                of immediate medical attention to result in a condition described in
                clause (i), (ii), or (iii) of section 1867(e)(1)(A) of the Social
                Security Act (42 U.S.C. 1395dd(e)(1)(A)). (In that provision of the
                Social Security Act, clause (i) refers to placing the health of the
                individual (or, with respect to a pregnant woman, the health of the
                woman or her unborn child) in serious jeopardy; clause (ii) refers to
                serious impairment to bodily functions; and clause (iii) refers to
                serious dysfunction of any bodily organ or part.)
                 (2) Emergency services means, with respect to an emergency medical
                condition--
                 (i) In general. (A) An appropriate medical screening examination
                (as required under section 1867 of the Social Security Act (42 U.S.C.
                1395dd) or as would be required under such section if such section
                applied to an independent freestanding emergency department) that is
                within the capability of the emergency department of a hospital or of
                an independent freestanding emergency department, as applicable,
                including ancillary services routinely available to the emergency
                department to evaluate such emergency medical condition; and
                 (B) Within the capabilities of the staff and facilities available
                at the hospital or the independent freestanding emergency department,
                as applicable, such further medical examination and treatment as are
                required under section 1867 of the Social Security Act (42 U.S.C.
                1395dd), or as would be required under such section if such section
                applied to an independent freestanding emergency department, to
                stabilize the patient (regardless of the department of the hospital in
                which such further examination or treatment is furnished).
                 (ii) Inclusion of additional services. (A) Subject to paragraph
                (c)(2)(ii)(B) of this section, items and services--
                 (1) For which benefits are provided or covered under the plan or
                coverage; and
                 (2) That are furnished by a nonparticipating provider or
                nonparticipating emergency facility (regardless of the department of
                the hospital in which such items or services are furnished) after the
                participant or beneficiary is stabilized and as part of outpatient
                observation or an inpatient or outpatient stay with respect to the
                visit in which the services described in paragraph (c)(2)(i) of this
                section are furnished.
                 (B) Items and services described in paragraph (c)(2)(ii)(A) of this
                section are not included as emergency services if all of the conditions
                in 45 CFR 149.410(b) are met.
                 (3) To stabilize, with respect to an emergency medical condition,
                has the meaning given such term in section 1867(e)(3) of the Social
                Security Act (42 U.S.C. 1395dd(e)(3)).
                 (d) Applicability date. The provisions of this section are
                applicable with respect to plan years beginning on or after January 1,
                2022.
                Sec. 2590.716-5 Preventing surprise medical bills for non-emergency
                services performed by nonparticipating providers at certain
                participating facilities.
                 (a) In general. If a group health plan, or a health insurance
                issuer offering group health insurance coverage, provides or covers any
                benefits with respect to items and services described in paragraph (b)
                of this section, the plan or issuer must cover the items and services
                when furnished by a nonparticipating provider in accordance with
                paragraph (c) of this section.
                 (b) Items and services described. The items and services described
                in this paragraph (b) are items and services (other than emergency
                services) furnished to a participant or beneficiary by a
                nonparticipating provider with respect to a visit at a participating
                health care facility, unless the provider has satisfied the notice and
                consent criteria of 45 CFR 149.420(c) through (i) with respect to such
                items and services.
                 (c) Coverage requirements. In the case of items and services
                described in paragraph (b) of this section, the plan or issuer--
                 (1) Must not impose a cost-sharing requirement for the items and
                services that is greater than the cost-sharing requirement that would
                apply if the items or services had been furnished by a participating
                provider.
                 (2) Must calculate the cost-sharing requirements as if the total
                amount that would have been charged for the items and services by such
                participating provider were equal to the recognized amount for the
                items and services.
                 (3) Not later than 30 calendar days after the bill for the items or
                services is
                [[Page 36963]]
                transmitted by the provider (or in cases where the recognized amount is
                determined by a specified State law or All-Payer Model Agreement, such
                other timeframe as specified under the State law or All-Payer Model
                Agreement), must determine whether the items and services are covered
                under the plan or coverage and, if the items and services are covered,
                send to the provider an initial payment or a notice of denial of
                payment. For purposes of this paragraph (c)(3), the 30-calendar-day
                period begins on the date the plan or issuer receives the information
                necessary to decide a claim for payment for the items or services.
                 (4) Must pay a total plan or coverage payment directly to the
                nonparticipating provider that is equal to the amount by which the out-
                of-network rate for the items and services involved exceeds the cost-
                sharing amount for the items and services (as determined in accordance
                with paragraphs (c)(1) and (2) of this section), less any initial
                payment amount made under paragraph (c)(3) of this section. The total
                plan or coverage payment must be made in accordance with the timing
                requirement described in section 716(c)(6) of ERISA, or in cases where
                the out-of-network rate is determined under a specified State law or
                All-Payer Model Agreement, such other timeframe as specified by the
                State law or All-Payer Model Agreement.
                 (5) Must count any cost-sharing payments made by the participant or
                beneficiary toward any in-network deductible and in-network out-of-
                pocket maximums (including the annual limitation on cost sharing under
                section 2707(b) of the PHS Act) (as applicable) applied under the plan
                or coverage (and the in-network deductible and out-of-pocket maximums
                must be applied) in the same manner as if such cost-sharing payments
                were made with respect to items and services furnished by a
                participating provider.
                 (d) Applicability date. The provisions of this section are
                applicable with respect to plan years beginning on or after January 1,
                2022.
                Sec. 2590.716-6 Methodology for calculating qualifying payment
                amount.
                 (a) Definitions. For purposes of this section, the following
                definitions apply:
                 (1) Contracted rate means the total amount (including cost sharing)
                that a group health plan or health insurance issuer has contractually
                agreed to pay a participating provider, facility, or provider of air
                ambulance services for covered items and services, whether directly or
                indirectly, including through a third-party administrator or pharmacy
                benefit manager. Solely for purposes of this definition, a single case
                agreement, letter of agreement, or other similar arrangement between a
                provider, facility, or air ambulance provider and a plan or issuer,
                used to supplement the network of the plan or coverage for a specific
                participant or beneficiary in unique circumstances, does not constitute
                a contract.
                 (2) Derived amount has the meaning given the term in Sec.
                2590.715-2715A1.
                 (3) Eligible database means--
                 (i) A State all-payer claims database; or
                 (ii) Any third-party database which--
                 (A) Is not affiliated with, or owned or controlled by, any health
                insurance issuer, or a health care provider, facility, or provider of
                air ambulance services (or any member of the same controlled group as,
                or under common control with, such an entity). For purposes of this
                paragraph (a)(3)(ii)(A), the term controlled group means a group of two
                or more persons that is treated as a single employer under sections
                52(a), 52(b), 414(m), or 414(o) of the Internal Revenue Code of 1986,
                as amended;
                 (B) Has sufficient information reflecting in-network amounts paid
                by group health plans or health insurance issuers offering group health
                insurance coverage to providers, facilities, or providers of air
                ambulance services for relevant items and services furnished in the
                applicable geographic region; and
                 (C) Has the ability to distinguish amounts paid to participating
                providers and facilities by commercial payers, such as group health
                plans and health insurance issuers offering group health insurance
                coverage, from all other claims data, such as amounts billed by
                nonparticipating providers or facilities and amounts paid by public
                payers, including the Medicare program under title XVIII of the Social
                Security Act, the Medicaid program under title XIX of the Social
                Security Act (or a demonstration project under title XI of the Social
                Security Act), or the Children's Health Insurance Program under title
                XXI of the Social Security Act.
                 (4) Facility of the same or similar facility type means, with
                respect to emergency services, either--
                 (i) An emergency department of a hospital; or
                 (ii) An independent freestanding emergency department.
                 (5) First coverage year means, with respect to an item or service
                for which coverage is not offered in 2019 under a group health plan or
                group health insurance coverage offered by a health insurance issuer,
                the first year after 2019 for which coverage for such item or service
                is offered under that plan or coverage.
                 (6) First sufficient information year means, with respect to a
                group health plan or group health insurance coverage offered by a
                health insurance issuer--
                 (i) In the case of an item or service for which the plan or
                coverage does not have sufficient information to calculate the median
                of the contracted rates described in paragraph (b) of this section in
                2019, the first year after 2022 for which the plan or issuer has
                sufficient information to calculate the median of such contracted rates
                in the year immediately preceding that first year after 2022; and
                 (ii) In the case of a newly covered item or service, the first year
                after the first coverage year for such item or service with respect to
                such plan or coverage for which the plan or issuer has sufficient
                information to calculate the median of the contracted rates described
                in paragraph (b) of this section in the year immediately preceding that
                first year.
                 (7) Geographic region means--
                 (i) For items and services other than air ambulance services--
                 (A) Subject to paragraphs (a)(7)(i)(B) and (C) of this section, one
                region for each metropolitan statistical area, as described by the U.S.
                Office of Management and Budget and published by the U.S. Census
                Bureau, in a State, and one region consisting of all other portions of
                the State.
                 (B) If a plan or issuer does not have sufficient information to
                calculate the median of the contracted rates described in paragraph (b)
                of this section for an item or service provided in a geographic region
                described in paragraph (a)(7)(i)(A) of this section, one region
                consisting of all metropolitan statistical areas, as described by the
                U.S. Office of Management and Budget and published by the U.S. Census
                Bureau, in the State, and one region consisting of all other portions
                of the State.
                 (C) If a plan or issuer does not have sufficient information to
                calculate the median of the contracted rates described in paragraph (b)
                of this section for an item or service provided in a geographic region
                described in paragraph (a)(7)(i)(B) of this section, one region
                consisting of all metropolitan statistical areas, as described by the
                U.S. Office of Management and Budget and published by the U.S. Census
                Bureau, in each Census division and one region consisting of all other
                portions of the Census division, as described by the U.S. Census
                Bureau.
                 (ii) For air ambulance services--
                 (A) Subject to paragraph (a)(7)(ii)(B) of this section, one region
                consisting of all metropolitan statistical areas, as described by the
                U.S. Office of
                [[Page 36964]]
                Management and Budget and published by the U.S. Census Bureau, in the
                State, and one region consisting of all other portions of the State,
                determined based on the point of pick-up (as defined in 42 CFR
                414.605).
                 (B) If a plan or issuer does not have sufficient information to
                calculate the median of the contracted rates described in paragraph (b)
                of this section for an air ambulance service provided in a geographic
                region described in paragraph (a)(7)(ii)(A) of this section, one region
                consisting of all metropolitan statistical areas, as described by the
                U.S. Office of Management and Budget and published by the U.S. Census
                Bureau, in each Census division and one region consisting of all other
                portions of the Census division, as described by the U.S. Census
                Bureau, determined based on the point of pick-up (as defined in 42 CFR
                414.605).
                 (8) Insurance market is, irrespective of the State, one of the
                following:
                 (i) The individual market (other than short-term, limited-duration
                insurance or individual health insurance coverage that consists solely
                of excepted benefits).
                 (ii) The large group market (other than coverage that consists
                solely of excepted benefits).
                 (iii) The small group market (other than coverage that consists
                solely of excepted benefits).
                 (iv) In the case of a self-insured group health plan, all self-
                insured group health plans (other than account-based plans, as defined
                in Sec. 2590.715-2711(d)(6)(i), and plans that consist solely of
                excepted benefits) of the same plan sponsor, or at the option of the
                plan sponsor, all self-insured group health plans administered by the
                same entity (including a third-party administrator contracted by the
                plan), to the extent otherwise permitted by law, that is responsible
                for calculating the qualifying payment amount on behalf of the plan.
                 (9) Modifiers mean codes applied to the service code that provide a
                more specific description of the furnished item or service and that may
                adjust the payment rate or affect the processing or payment of the code
                billed.
                 (10) Newly covered item or service means an item or service for
                which coverage was not offered in 2019 under a group health plan or
                group health insurance coverage offered by a health insurance issuer,
                but that is offered under the plan or coverage in a year after 2019.
                 (11) New service code means a service code that was created or
                substantially revised in a year after 2019.
                 (12) Provider in the same or similar specialty means the practice
                specialty of a provider, as identified by the plan or issuer consistent
                with the plan's or issuer's usual business practice, except that, with
                respect to air ambulance services, all providers of air ambulance
                services are considered to be a single provider specialty.
                 (13) Same or similar item or service means a health care item or
                service billed under the same service code, or a comparable code under
                a different procedural code system.
                 (14) Service code means the code that describes an item or service
                using the Current Procedural Terminology (CPT) code, Healthcare Common
                Procedure Coding System (HCPCS), or Diagnosis-Related Group (DRG)
                codes.
                 (15) Sufficient information means, for purposes of determining
                whether a group health plan or health insurance issuer offering group
                health insurance coverage has sufficient information to calculate the
                median of the contracted rates described in paragraph (b) of this
                section--
                 (i) The plan or issuer has at least three contracted rates on
                January 31, 2019, to calculate the median of the contracted rates in
                accordance with paragraph (b) of this section; or
                 (ii) For an item or service furnished during a year after 2022 that
                is used to determine the first sufficient information year--
                 (A) The plan or issuer has at least three contracted rates on
                January 31 of the year immediately preceding that year to calculate the
                median of the contracted rates in accordance with paragraph (b) of this
                section; and
                 (B) The contracted rates under paragraph (a)(15)(ii)(A) of this
                section account (or are reasonably expected to account) for at least 25
                percent of the total number of claims paid for that item or service for
                that year with respect to all plans of the sponsor (or the
                administering entity as provided in paragraph (a)(8)(iv) of this
                section, if applicable) or all coverage offered by the issuer that are
                offered in the same insurance market.
                 (16) Qualifying payment amount means, with respect to a sponsor of
                a group health plan or health insurance issuer offering group health
                insurance coverage, the amount calculated using the methodology
                described in paragraph (c) of this section.
                 (17) Underlying fee schedule rate means the rate for a covered item
                or service from a particular participating provider, providers, or
                facility that a group health plan or health insurance issuer uses to
                determine a participant's or beneficiary's cost-sharing liability for
                the item or service, when that rate is different from the contracted
                rate.
                 (b) Methodology for calculation of median contracted rate--(1) In
                general. The median contracted rate for an item or service is
                calculated by arranging in order from least to greatest the contracted
                rates of all group health plans of the plan sponsor (or the
                administering entity as provided in paragraph (a)(8)(iv) of this
                section, if applicable) or all group health insurance coverage offered
                by the issuer in the same insurance market for the same or similar item
                or service that is provided by a provider in the same or similar
                specialty or facility of the same or similar facility type and provided
                in the geographic region in which the item or service is furnished and
                selecting the middle number. If there are an even number of contracted
                rates, the median contracted rate is the average of the middle two
                contracted rates. In determining the median contracted rate, the amount
                negotiated under each contract is treated as a separate amount. If a
                plan or issuer has a contract with a provider group or facility, the
                rate negotiated with that provider group or facility under the contract
                is treated as a single contracted rate if the same amount applies with
                respect to all providers of such provider group or facility under the
                single contract. However, if a plan or issuer has a contract with
                multiple providers, with separate negotiated rates with each particular
                provider, each unique contracted rate with an individual provider
                constitutes a single contracted rate. Further, if a plan or issuer has
                separate contracts with individual providers, the contracted rate under
                each such contract constitutes a single contracted rate (even if the
                same amount is paid to multiple providers under separate contracts).
                 (2) Calculation rules. In calculating the median contracted rate, a
                plan or issuer must:
                 (i) Calculate the median contracted rate with respect to all plans
                of such sponsor (or the administering entity as provided in paragraph
                (a)(8)(iv) of this section, if applicable) or all coverage offered by
                such issuer that are offered in the same insurance market;
                 (ii) Calculate the median contracted rate using the full contracted
                rate applicable to the service code, except that the plan or issuer
                must--
                 (A) Calculate separate median contracted rates for CPT code
                modifiers ``26'' (professional component) and ``TC'' (technical
                component);
                 (B) For anesthesia services, calculate a median contracted rate for
                the
                [[Page 36965]]
                anesthesia conversion factor for each service code;
                 (C) For air ambulance services, calculate a median contracted rate
                for the air mileage service codes (A0435 and A0436); and
                 (D) Where contracted rates otherwise vary based on applying a
                modifier code, calculate a separate median contracted rate for each
                such service code-modifier combination;
                 (iii) In the case of payments made by a plan or issuer that are not
                on a fee-for-service basis (such as bundled or capitation payments),
                calculate a median contracted rate for each item or service using the
                underlying fee schedule rates for the relevant items or services. If
                the plan or issuer does not have an underlying fee schedule rate for
                the item or service, it must use the derived amount to calculate the
                median contracted rate; and
                 (iv) Exclude risk sharing, bonus, penalty, or other incentive-based
                or retrospective payments or payment adjustments.
                 (3) Provider specialties; facility types. (i) If a plan or issuer
                has contracted rates that vary based on provider specialty for a
                service code, the median contracted rate is calculated separately for
                each provider specialty, as applicable.
                 (ii) If a plan or issuer has contracted rates for emergency
                services that vary based on facility type for a service code, the
                median contracted rate is calculated separately for each facility of
                the same or similar facility type.
                 (c) Methodology for calculation of the qualifying payment amount--
                (1) In general. (i) For an item or service (other than items or
                services described in paragraphs (c)(1)(iii) through (vii) of this
                section) furnished during 2022, the plan or issuer must calculate the
                qualifying payment amount by increasing the median contracted rate (as
                determined in accordance with paragraph (b) of this section) for the
                same or similar item or service under such plans or coverage,
                respectively, on January 31, 2019, by the combined percentage increase
                as published by the Department of the Treasury and the Internal Revenue
                Service to reflect the percentage increase in the CPI-U over 2019, such
                percentage increase over 2020, and such percentage increase over 2021.
                 (A) The combined percentage increase for 2019, 2020, and 2021 will
                be published in guidance by the Internal Revenue Service. The
                Department of the Treasury and the Internal Revenue Service will
                calculate the percentage increase using the CPI-U published by the
                Bureau of Labor Statistics of the Department of Labor.
                 (B) For purposes of this paragraph (c)(1)(i), the CPI-U for each
                calendar year is the average of the CPI-U as of the close of the 12-
                month period ending on August 31 of the calendar year, rounded to 10
                decimal places.
                 (C) The combined percentage increase for 2019, 2020, and 2021 will
                be calculated as:
                (CPI-U 2019/CPI-U 2018) x (CPI-U 2020/CPI-U 2019) x (CPI-U 2021/CPI-U
                2020)
                 (ii) For an item or service (other than items or services described
                in paragraphs (c)(1)(iii) through (vii) of this section) furnished
                during 2023 or a subsequent year, the plan or issuer must calculate the
                qualifying payment amount by increasing the qualifying payment amount
                determined under paragraph (c)(1)(i) of this section, for such an item
                or service furnished in the immediately preceding year, by the
                percentage increase as published by the Department of the Treasury and
                the Internal Revenue Service.
                 (A) The percentage increase for any year after 2022 will be
                published in guidance by the Internal Revenue Service. The Department
                of the Treasury and Internal Revenue Service will calculate the
                percentage increase using the CPI-U published by the Bureau of Labor
                Statistics of the Department of Labor.
                 (B) For purposes of this paragraph (c)(1)(ii), the CPI-U for each
                calendar year is the average of the CPI-U as of the close of the 12-
                month period ending on August 31 of the calendar year, rounded to 10
                decimal places.
                 (C) The combined percentage increase for any year will be
                calculated as CPI-U present year/CPI-U prior year.
                 (iii) For anesthesia services furnished during 2022, the plan or
                issuer must calculate the qualifying payment amount by first increasing
                the median contracted rate for the anesthesia conversion factor (as
                determined in accordance with paragraph (b) of this section) for the
                same or similar item or service under such plans or coverage,
                respectively, on January 31, 2019, in accordance with paragraph
                (c)(1)(i) of this section (referred to in this section as the indexed
                median contracted rate for the anesthesia conversion factor). The plan
                or issuer must then multiply the indexed median contracted rate for the
                anesthesia conversion factor by the sum of the base unit, time unit,
                and physical status modifier units of the participant or beneficiary to
                whom anesthesia services are furnished to determine the qualifying
                payment amount.
                 (A) The base units for an anesthesia service code are the base
                units for that service code specified in the most recent edition (as of
                the date of service) of the American Society of Anesthesiologists
                Relative Value Guide.
                 (B) The time unit is measured in 15-minute increments or a fraction
                thereof.
                 (C) The physical status modifier on a claim is a standard modifier
                describing the physical status of the patient and is used to
                distinguish between various levels of complexity of the anesthesia
                services provided, and is expressed as a unit with a value between zero
                (0) and three (3).
                 (D) The anesthesia conversion factor is expressed in dollars per
                unit and is a contracted rate negotiated with the plan or issuer.
                 (iv) For anesthesia services furnished during 2023 or a subsequent
                year, the plan or issuer must calculate the qualifying payment amount
                by first increasing the indexed median contracted rate for the
                anesthesia conversion factor, determined under paragraph (c)(1)(iii) of
                this section for such services furnished in the immediately preceding
                year, in accordance with paragraph (c)(1)(ii) of this section. The plan
                or issuer must then multiply that amount by the sum of the base unit,
                time unit, and physical status modifier units for the participant or
                beneficiary to whom anesthesia services are furnished to determine the
                qualifying payment amount.
                 (v) For air ambulance services billed using the air mileage service
                codes (A0435 and A0436) that are furnished during 2022, the plan or
                issuer must calculate the qualifying payment amount for services billed
                using the air mileage service codes by first increasing the median
                contracted rate (as determined in accordance with paragraph (b) of this
                section), in accordance with paragraph (c)(1)(i) of this section
                (referred to in this section as the indexed median air mileage rate).
                The plan or issuer must then multiply the indexed median air mileage
                rate by the number of loaded miles provided to the participant or
                beneficiary to determine the qualifying payment amount.
                 (A) The air mileage rate is expressed in dollars per loaded mile
                flown, is expressed in statute miles (not nautical miles), and is a
                contracted rate negotiated with the plan or issuer.
                 (B) The number of loaded miles is the number of miles a patient is
                transported in the air ambulance vehicle.
                 (C) The qualifying payment amount for other service codes
                associated with air ambulance services is calculated in accordance with
                paragraphs (c)(1)(i) and (ii) of this section.
                [[Page 36966]]
                 (vi) For air ambulance services billed using the air mileage
                service codes (A0435 and A0436) that are furnished during 2023 or a
                subsequent year, the plan or issuer must calculate the qualifying
                payment amount by first increasing the indexed median air mileage rate,
                determined under paragraph (c)(1)(v) of this section for such services
                furnished in the immediately preceding year, in accordance with
                paragraph (c)(1)(ii) of this section. The plan or issuer must then
                multiply the indexed median air mileage rate by the number of loaded
                miles provided to the participant or beneficiary to determine the
                qualifying payment amount.
                 (vii) For any other items or services for which a plan or issuer
                generally determines payment for the same or similar items or services
                by multiplying a contracted rate by another unit value, the plan or
                issuer must calculate the qualifying payment amount using a methodology
                that is similar to the methodology required under paragraphs
                (c)(1)(iii) through (vi) of this section and reasonably reflects the
                payment methodology for same or similar items or services.
                 (2) New plans and coverage. With respect to a sponsor of a group
                health plan or health insurance issuer offering group health insurance
                coverage in a geographic region in which the sponsor or issuer,
                respectively, did not offer any group health plan or health insurance
                coverage during 2019--
                 (i) For the first year in which the group health plan or group
                health insurance coverage, respectively, is offered in such region--
                 (A) If the plan or issuer has sufficient information to calculate
                the median of the contracted rates described in paragraph (b) of this
                section, the plan or issuer must calculate the qualifying payment
                amount in accordance with paragraph (c)(1) of this section for items
                and services that are covered by the plan or coverage and furnished
                during the first year; and
                 (B) If the plan or issuer does not have sufficient information to
                calculate the median of the contracted rates described in paragraph (b)
                of this section for an item or service provided in a geographic region,
                the plan or issuer must determine the qualifying payment amount for the
                item or service in accordance with paragraph (c)(3)(i) of this section.
                 (ii) For each subsequent year the group health plan or group health
                insurance coverage, respectively, is offered in the region, the plan or
                issuer must calculate the qualifying payment amount by increasing the
                qualifying payment amount determined under this paragraph (c)(2) for
                the items and services furnished in the immediately preceding year, in
                accordance with paragraph (c)(1)(ii), (iv), or (vi) of this section, as
                applicable.
                 (3) Insufficient information; newly covered items and services. In
                the case of a plan or issuer that does not have sufficient information
                to calculate the median of the contracted rates described in paragraph
                (b) of this section in 2019 (or, in the case of a newly covered item or
                service, in the first coverage year for such item or service with
                respect to such plan or coverage if the plan or issuer does not have
                sufficient information) for an item or service provided in a geographic
                region--
                 (i) For an item or service furnished during 2022 (or, in the case
                of a newly covered item or service, during the first coverage year for
                the item or service with respect to the plan or coverage), the plan or
                issuer must calculate the qualifying payment amount by first
                identifying the rate that is equal to the median of the in-network
                allowed amounts for the same or similar item or service provided in the
                geographic region in the year immediately preceding the year in which
                the item or service is furnished (or, in the case of a newly covered
                item or service, the year immediately preceding such first coverage
                year) determined by the plan or issuer, respectively, through use of
                any eligible database, and then increasing that rate by the percentage
                increase in the CPI-U over such preceding year. For purposes of this
                section, in cases in which an eligible database is used to determine
                the qualifying payment amount with respect to an item or service
                furnished during a calendar year, the plan or issuer must use the same
                database for determining the qualifying payment amount for that item or
                service furnished through the last day of the calendar year, and if a
                different database is selected for some items or services, the basis
                for that selection must be one or more factors not directly related to
                the rate of those items or services (such as sufficiency of data for
                those items or services).
                 (ii) For an item or service furnished in a subsequent year (before
                the first sufficient information year for such item or service with
                respect to such plan or coverage), the plan or issuer must calculate
                the qualifying payment amount by increasing the qualifying payment
                amount determined under paragraph (c)(3)(i) of this section or this
                paragraph (c)(3)(ii), as applicable, for such item or service for the
                year immediately preceding such subsequent year, by the percentage
                increase in CPI-U over such preceding year;
                 (iii) For an item or service furnished in the first sufficient
                information year for such item or service with respect to such plan or
                coverage, the plan or issuer must calculate the qualifying payment
                amount in accordance with paragraph (c)(1)(i), (iii), or (v) of this
                section, as applicable, except that in applying such paragraph to such
                item or service, the reference to `furnished during 2022' is treated as
                a reference to furnished during such first sufficient information year,
                the reference to `in 2019' is treated as a reference to such sufficient
                information year, and the increase described in such paragraph is not
                applied; and
                 (iv) For an item or service furnished in any year subsequent to the
                first sufficient information year for such item or service with respect
                to such plan or coverage, the plan or issuer must calculate the
                qualifying payment amount in accordance with paragraph (c)(1)(ii),
                (iv), or (vi) of this section, as applicable, except that in applying
                such paragraph to such item or service, the reference to `furnished
                during 2023 or a subsequent year' is treated as a reference to
                furnished during the year after such first sufficient information year
                or a subsequent year.
                 (4) New service codes. In the case of a plan or issuer that does
                not have sufficient information to calculate the median of the
                contracted rates described in paragraph (b) of this section and
                determine the qualifying payment amount under paragraphs (c)(1) through
                (3) of this section because the item or service furnished is billed
                under a new service code--
                 (i) For an item or service furnished during 2022 (or, in the case
                of a newly covered item or service, during the first coverage year for
                the item or service with respect to the plan or coverage), the plan or
                issuer must identify a reasonably related service code that existed in
                the immediately preceding year and--
                 (A) If the Centers for Medicare & Medicaid Services has established
                a Medicare payment rate for the item or service billed under the new
                service code, the plan or issuer must calculate the qualifying payment
                amount by first calculating the ratio of the rate that Medicare pays
                for the item or service billed under the new service code compared to
                the rate that Medicare pays for the item or service billed under the
                related service code, and then multiplying the ratio by the qualifying
                payment amount for an item or service billed under the related service
                code for
                [[Page 36967]]
                the year in which the item or service is furnished.
                 (B) If the Centers for Medicare & Medicaid Services has not
                established a Medicare payment rate for the item or service billed
                under the new service code, the plan or issuer must calculate the
                qualifying payment amount by first calculating the ratio of the rate
                that the plan or issuer reimburses for the item or service billed under
                the new service code compared to the rate that the plan or issuer
                reimburses for the item or service billed under the related service
                code, and then multiplying the ratio by the qualifying payment amount
                for an item or service billed under the related service code.
                 (ii) For an item or service furnished in a subsequent year (before
                the first sufficient information year for such item or service with
                respect to such plan or coverage or before the first year for which an
                eligible database has sufficient information to a calculate a rate
                under paragraph (c)(3)(i) of this section in the immediately preceding
                year), the plan or issuer must calculate the qualifying payment amount
                by increasing the qualifying payment amount determined under paragraph
                (c)(4)(i) of this section or this paragraph (c)(4)(ii), as applicable,
                for such item or service for the year immediately preceding such
                subsequent year, by the percentage increase in CPI-U over such
                preceding year;
                 (iii) For an item or service furnished in the first sufficient
                information year for such item or service with respect to such plan or
                coverage or the first year for which an eligible database has
                sufficient information to calculate a rate under paragraph (c)(3)(i) of
                this section in the immediately preceding year, the plan or issuer must
                calculate the qualifying payment amount in accordance with paragraph
                (c)(3) of this section.
                 (d) Information to be shared about qualifying payment amount. In
                cases in which the recognized amount with respect to an item or service
                furnished by a nonparticipating provider, nonparticipating emergency
                facility, or nonparticipating provider of air ambulance services is the
                qualifying payment amount, the plan or issuer must provide in writing,
                in paper or electronic form, to the provider or facility, as
                applicable--
                 (1) With each initial payment or notice of denial of payment under
                Sec. 2590.716-4, Sec. 2590.716-5, or Sec. 2590.717-1 of this part:
                 (i) The qualifying payment amount for each item or service
                involved;
                 (ii) A statement to certify that, based on the determination of the
                plan or issuer--
                 (A) The qualifying payment amount applies for purposes of the
                recognized amount (or, in the case of air ambulance services, for
                calculating the participant's or beneficiary's cost sharing); and
                 (B) Each qualifying payment amount shared with the provider or
                facility was determined in compliance with this section;
                 (iii) A statement that if the provider or facility, as applicable,
                wishes to initiate a 30-day open negotiation period for purposes of
                determining the amount of total payment, the provider or facility may
                contact the appropriate person or office to initiate open negotiation,
                and that if the 30-day negotiation period does not result in a
                determination, generally, the provider or facility may initiate the
                independent dispute resolution process within 4 days after the end of
                the open negotiation period; and
                 (iv) 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 such item or service.
                 (2) In a timely manner upon request of the provider or facility:
                 (i) Information about whether the qualifying payment amount for
                items and services involved included contracted rates that were not on
                a fee-for-service basis for those specific items and services and
                whether the qualifying payment amount for those items and services was
                determined using underlying fee schedule rates or a derived amount;
                 (ii) If a plan or issuer uses an eligible database under paragraph
                (c)(3) of this section to determine the qualifying payment amount,
                information to identify which database was used; and
                 (iii) If a related service code was used to determine the
                qualifying payment amount for an item or service billed under a new
                service code under paragraph (c)(4)(i) or (ii) of this section,
                information to identify the related service code;
                 (iv) If applicable, a statement that the plan's or issuer's
                contracted rates include risk-sharing, bonus, penalty, or other
                incentive-based or retrospective payments or payment adjustments for
                the items and services involved (as applicable) that were excluded for
                purposes of calculating the qualifying payment amount.
                 (e) Certain access fees to databases. In the case of a plan or
                issuer that, pursuant to this section, uses an eligible database to
                determine the qualifying payment amount for an item or service, the
                plan or issuer is responsible for any costs associated with accessing
                such database.
                 (f) Applicability date. The provisions of this section are
                applicable with respect to plan years beginning on or after January 1,
                2022.
                Sec. 2590.716-7 Complaints process for surprise medical bills
                regarding group health plans and group health insurance coverage.
                 (a) Scope and definitions--(1) Scope. This section establishes a
                process to receive and resolve complaints regarding information that a
                specific group health plan or health insurance issuer offering group
                health insurance coverage may be failing to meet the requirements under
                subpart D of this part, which may warrant an investigation.
                 (2) Definitions. In this section--
                 (i) Complaint means a communication, written or oral, that
                indicates there has been a potential violation of the requirements
                under subpart D of this part, whether or not a violation actually
                occurred.
                 (ii) Complainant means any individual, or their authorized
                representative, who files a complaint as defined in paragraph (a)(2)(i)
                of this section.
                 (b) Complaints process. (1) DOL will consider the date a complaint
                is filed to be the date upon which DOL receives an oral or written
                statement that identifies information about the complaint sufficient to
                identify the parties involved and the action or inaction complained of.
                 (2) DOL will notify complainants, by oral or written means, of
                receipt of the complaint no later than 60 business days after the
                complaint is received. DOL will include a response acknowledging
                receipt of the complaint, notifying the complainant of their rights and
                obligations under the complaints process, and describing the next steps
                of the complaint resolution process. As part of the response, DOL may
                request additional information needed to process the complaint. Such
                additional information may include:
                 (i) Explanations of benefits;
                 (ii) Processed claims;
                 (iii) Information about the health care provider, facility, or
                provider of air ambulance services involved;
                 (iv) Information about the group health plan or health insurance
                issuer covering the individual;
                 (v) Information to support a determination regarding whether the
                service was an emergency service or non-emergency service;
                 (vi) The summary plan description, policy, certificate, contract of
                insurance,
                [[Page 36968]]
                membership booklet, outline of coverage, or other evidence of coverage
                the plan or issuer provides to participants or beneficiaries;
                 (vii) Documents regarding the facts in the complaint in the
                possession of, or otherwise attainable by, the complainant; or
                 (viii) Any other information DOL may need to make a determination
                of facts for an investigation.
                 (3) DOL will make reasonable efforts consistent with agency
                practices to notify the complainant of the outcome of the complaint
                after the submission is processed through appropriate methods as
                determined by DOL. A complaint is considered processed after DOL has
                reviewed the complaint and accompanying information and made an outcome
                determination. Based on the nature of the complaint and the plan or
                issuer involved, DOL may--
                 (i) Refer the complainant to another appropriate Federal or State
                resolution process;
                 (ii) Notify the complainant and make reasonable efforts to refer
                the complainant to the appropriate State or Federal regulatory
                authority if DOL receives a complaint where another entity has
                enforcement jurisdiction over the plan or issuer;
                 (iii) Refer the plan or issuer for an investigation for enforcement
                action; or
                 (iv) Provide the complainant with an explanation of the resolution
                of the complaint and any corrective action taken.
                Sec. 2590.717-1 Preventing surprise medical bills for air ambulance
                services.
                 (a) In general. If a group health plan or a health insurance issuer
                offering group health insurance coverage provides or covers any
                benefits for air ambulance services, the plan or issuer must cover such
                services from a nonparticipating provider of air ambulance services in
                accordance with paragraph (b) of this section.
                 (b) Coverage requirements. A plan or issuer described in paragraph
                (a) of this section must provide coverage of air ambulance services in
                the following manner--
                 (1) The cost-sharing requirements with respect to the services must
                be the same requirements that would apply if the services were provided
                by a participating provider of air ambulance services.
                 (2) The cost-sharing requirement must be calculated as if the total
                amount that would have been charged for the services by a participating
                provider of air ambulance services were equal to the lesser of the
                qualifying payment amount (as determined in accordance with Sec.
                2590.716-6) or the billed amount for the services.
                 (3) The cost-sharing amounts must be counted towards any in-network
                deductible and in-network out-of-pocket maximums (including the annual
                limitation on cost sharing under section 2707(b) of the PHS Act) (as
                applicable) applied under the plan or coverage (and the in-network
                deductible and out-of-pocket maximums must be applied) in the same
                manner as if the cost-sharing payments were made with respect to
                services furnished by a participating provider of air ambulance
                services.
                 (4) The plan or issuer must--
                 (i) Not later than 30 calendar days after the bill for the services
                is transmitted by the provider of air ambulance services, determine
                whether the services are covered under the plan or coverage and, if the
                services are covered, send to the provider an initial payment or a
                notice of denial of payment. For purposes of this paragraph (b)(4)(i),
                the 30-calendar-day period begins on the date the plan or issuer
                receives the information necessary to decide a claim for payment for
                the services.
                 (ii) Pay a total plan or coverage payment directly to the
                nonparticipating provider furnishing such air ambulance services that
                is equal to the amount by which the out-of-network rate for the
                services exceeds the cost-sharing amount for the services (as
                determined in accordance with paragraphs (b)(1) and (2) of this
                section), less any initial payment amount made under paragraph
                (b)(4)(i) of this section. The total plan or coverage payment must be
                made in accordance with the timing requirement described in section
                717(b)(6) of ERISA, or in cases where the out-of-network rate is
                determined under a specified State law or All-Payer Model Agreement,
                such other timeframe as specified by the State law or All-Payer Model
                Agreement.
                 (c) Applicability date. The provisions of this section are
                applicable with respect to plan years beginning on or after January 1,
                2022.
                Sec. 2590.722 Choice of health care professional.
                 (a) Choice of health care professional--(1) Designation of primary
                care provider--(i) In general. If a group health plan, or a health
                insurance issuer offering group health insurance coverage, requires or
                provides for designation by a participant or beneficiary of a
                participating primary care provider, then the plan or issuer must
                permit each participant or beneficiary to designate any participating
                primary care provider who is available to accept the participant or
                beneficiary. In such a case, the plan or issuer must comply with the
                rules of paragraph (a)(4) of this section by informing each participant
                of the terms of the plan or health insurance coverage regarding
                designation of a primary care provider.
                 (ii) Construction. Nothing in paragraph (a)(1)(i) of this section
                is to be construed to prohibit the application of reasonable and
                appropriate geographic limitations with respect to the selection of
                primary care providers, in accordance with the terms of the plan or
                coverage, the underlying provider contracts, and applicable State law.
                 (iii) Example. The rules of this paragraph (a)(1) are illustrated
                by the following example:
                 (A) Facts. A group health plan requires individuals covered under
                the plan to designate a primary care provider. The plan permits each
                individual to designate any primary care provider participating in the
                plan's network who is available to accept the individual as the
                individual's primary care provider. If an individual has not designated
                a primary care provider, the plan designates one until the individual
                has made a designation. The plan provides a notice that satisfies the
                requirements of paragraph (a)(4) of this section regarding the ability
                to designate a primary care provider.
                 (B) Conclusion. In this Example, the plan has satisfied the
                requirements of paragraph (a) of this section.
                 (2) Designation of pediatrician as primary care provider--(i) In
                general. If a group health plan, or a health insurance issuer offering
                group health insurance coverage, requires or provides for the
                designation of a participating primary care provider for a child by a
                participant or beneficiary, the plan or issuer must permit the
                participant or beneficiary to designate a physician (allopathic or
                osteopathic) who specializes in pediatrics (including pediatric
                subspecialties, based on the scope of that provider's license under
                applicable State law) as the child's primary care provider if the
                provider participates in the network of the plan or issuer and is
                available to accept the child. In such a case, the plan or issuer must
                comply with the rules of paragraph (a)(4) of this section by informing
                each participant (in the individual market, primary subscriber) of the
                terms of the plan or health insurance coverage regarding designation of
                a pediatrician as the child's primary care provider.
                 (ii) Construction. Nothing in paragraph (a)(2)(i) of this section
                is to be construed to waive any exclusions of
                [[Page 36969]]
                coverage under the terms and conditions of the plan or health insurance
                coverage with respect to coverage of pediatric care.
                 (iii) Examples. The rules of this paragraph (a)(2) are illustrated
                by the following examples:
                 (A) Example 1--(1) Facts. A group health plan's HMO designates for
                each participant a physician who specializes in internal medicine to
                serve as the primary care provider for the participant and any
                beneficiaries. Participant A requests that Pediatrician B be designated
                as the primary care provider for A's child. B is a participating
                provider in the HMO's network and is available to accept the child.
                 (2) Conclusion. In this Example 1, the HMO must permit A's
                designation of B as the primary care provider for A's child in order to
                comply with the requirements of this paragraph (a)(2).
                 (B) Example 2--(1) Facts. Same facts as Example 1 (paragraph
                (a)(2)(iii)(A) of this section), except that A takes A's child to B for
                treatment of the child's severe shellfish allergies. B wishes to refer
                A's child to an allergist for treatment. The HMO, however, does not
                provide coverage for treatment of food allergies, nor does it have an
                allergist participating in its network, and it therefore refuses to
                authorize the referral.
                 (2) Conclusion. In this Example 2, the HMO has not violated the
                requirements of this paragraph (a)(2) because the exclusion of
                treatment for food allergies is in accordance with the terms of A's
                coverage.
                 (3) Patient access to obstetrical and gynecological care--(i)
                General rights--(A) Direct access. A group health plan, or a health
                insurance issuer offering group health insurance coverage, described in
                paragraph (a)(3)(ii) of this section, may not require authorization or
                referral by the plan, issuer, or any person (including a primary care
                provider) in the case of a female participant or beneficiary who seeks
                coverage for obstetrical or gynecological care provided by a
                participating health care professional who specializes in obstetrics or
                gynecology. In such a case, the plan or issuer must comply with the
                rules of paragraph (a)(4) of this section by informing each participant
                that the plan may not require authorization or referral for obstetrical
                or gynecological care by a participating health care professional who
                specializes in obstetrics or gynecology. The plan or issuer may require
                such a professional to agree to otherwise adhere to the plan's or
                issuer's policies and procedures, including procedures regarding
                referrals and obtaining prior authorization and providing services
                pursuant to a treatment plan (if any) approved by the plan or issuer.
                For purposes of this paragraph (a)(3), a health care professional who
                specializes in obstetrics or gynecology is any individual (including a
                person other than a physician) who is authorized under applicable State
                law to provide obstetrical or gynecological care.
                 (B) Obstetrical and gynecological care. A group health plan or
                health insurance issuer described in paragraph (a)(3)(ii) of this
                section must treat the provision of obstetrical and gynecological care,
                and the ordering of related obstetrical and gynecological items and
                services, pursuant to the direct access described under paragraph
                (a)(3)(i)(A) of this section, by a participating health care
                professional who specializes in obstetrics or gynecology as the
                authorization of the primary care provider.
                 (ii) Application of paragraph. A group health plan, or a health
                insurance issuer offering group health insurance coverage, is described
                in this paragraph (a)(3) if the plan or issuer--
                 (A) Provides coverage for obstetrical or gynecological care; and
                 (B) Requires the designation by a participant or beneficiary of a
                participating primary care provider.
                 (iii) Construction. Nothing in paragraph (a)(3)(i) of this section
                is to be construed to--
                 (A) Waive any exclusions of coverage under the terms and conditions
                of the plan or health insurance coverage with respect to coverage of
                obstetrical or gynecological care; or
                 (B) Preclude the group health plan or health insurance issuer
                involved from requiring that the obstetrical or gynecological provider
                notify the primary care health care professional or the plan or issuer
                of treatment decisions.
                 (iv) Examples. The rules of this paragraph (a)(3) are illustrated
                by the following examples:
                 (A) Example 1--(1) Facts. A group health plan requires each
                participant to designate a physician to serve as the primary care
                provider for the participant and the participant's family. Participant
                A, a female, requests a gynecological exam with Physician B, an in-
                network physician specializing in gynecological care. The group health
                plan requires prior authorization from A's designated primary care
                provider for the gynecological exam.
                 (2) Conclusion. In this Example 1, the group health plan has
                violated the requirements of this paragraph (a)(3) because the plan
                requires prior authorization from A's primary care provider prior to
                obtaining gynecological services.
                 (B) Example 2--(1) Facts. Same facts as Example 1 (paragraph
                (a)(3)(iv)(A) of this section) except that A seeks gynecological
                services from C, an out-of-network provider.
                 (2) Conclusion. In this Example 2, the group health plan has not
                violated the requirements of this paragraph (a)(3) by requiring prior
                authorization because C is not a participating health care provider.
                 (C) Example 3--(1) Facts. Same facts as Example 1 (paragraph
                (a)(3)(iv)(A) of this section) except that the group health plan only
                requires B to inform A's designated primary care physician of treatment
                decisions.
                 (2) Conclusion. In this Example 3, the group health plan has not
                violated the requirements of this paragraph (a)(3) because A has direct
                access to B without prior authorization. The fact that the group health
                plan requires the designated primary care physician to be notified of
                treatment decisions does not violate this paragraph (a)(3).
                 (D) Example 4--(1) Facts. A group health plan requires each
                participant to designate a physician to serve as the primary care
                provider for the participant and the participant's family. The group
                health plan requires prior authorization before providing benefits for
                uterine fibroid embolization.
                 (2) Conclusion. In this Example 4, the plan requirement for prior
                authorization before providing benefits for uterine fibroid
                embolization does not violate the requirements of this paragraph (a)(3)
                because, though the prior authorization requirement applies to
                obstetrical services, it does not restrict access to any providers
                specializing in obstetrics or gynecology.
                 (4) Notice of right to designate a primary care provider--(i) In
                general. If a group health plan or health insurance issuer requires the
                designation by a participant or beneficiary of a primary care provider,
                the plan or issuer must provide a notice informing each participant (in
                the individual market, primary subscriber) of the terms of the plan or
                health insurance coverage regarding designation of a primary care
                provider and of the rights--
                 (A) Under paragraph (a)(1)(i) of this section, that any
                participating primary care provider who is available to accept the
                participant or beneficiary can be designated;
                 (B) Under paragraph (a)(2)(i) of this section, with respect to a
                child, that any participating physician who specializes in pediatrics
                can be designated as the primary care provider; and
                [[Page 36970]]
                 (C) Under paragraph (a)(3)(i) of this section, that the plan may
                not require authorization or referral for obstetrical or gynecological
                care by a participating health care professional who specializes in
                obstetrics or gynecology.
                 (ii) Timing. In the case of a group health plan or group health
                insurance coverage, the notice described in paragraph (a)(4)(i) of this
                section must be included whenever the plan or issuer provides a
                participant with a summary plan description or other similar
                description of benefits under the plan or health insurance coverage. In
                the case of individual health insurance coverage, the notice described
                in paragraph (a)(4)(i) of this section must be included whenever the
                issuer provides a primary subscriber with a policy, certificate, or
                contract of health insurance.
                 (iii) Model language. The following model language can be used to
                satisfy the notice requirement described in paragraph (a)(4)(i) of this
                section:
                 (A) For plans and issuers that require or allow for the designation
                of primary care providers by participants, or beneficiaries, insert:
                 [Name of group health plan or health insurance issuer] generally
                [requires/allows] the designation of a primary care provider. You
                have the right to designate any primary care provider who
                participates in our network and who is available to accept you or
                your family members. [If the plan or health insurance coverage
                designates a primary care provider automatically, insert: Until you
                make this designation, [name of group health plan or health
                insurance issuer] designates one for you.] For information on how to
                select a primary care provider, and for a list of the participating
                primary care providers, contact the [plan administrator or issuer]
                at [insert contact information].
                 (B) For plans and issuers that require or allow for the designation
                of a primary care provider for a child, add:
                 For children, you may designate a pediatrician as the primary care
                provider.
                 (C) For plans and issuers that provide coverage for obstetric or
                gynecological care and require the designation by a participant or
                beneficiary of a primary care provider, add:
                 You do not need prior authorization from [name of group health
                plan or issuer] or from any other person (including a primary care
                provider) in order to obtain access to obstetrical or gynecological
                care from a health care professional in our network who specializes
                in obstetrics or gynecology. The health care professional, however,
                may be required to comply with certain procedures, including
                obtaining prior authorization for certain services, following a pre-
                approved treatment plan, or procedures for making referrals. For a
                list of participating health care professionals who specialize in
                obstetrics or gynecology, contact the [plan administrator or issuer]
                at [insert contact information].
                 (b) Applicability date. The provisions of this section are
                applicable with respect to plan years beginning on or after January 1,
                2022.
                Department of Health and Human Services
                45 CFR Subtitle A, Subchapter B
                 For the reasons stated in the preamble, the Department of Health
                and Human Services amends 45 CFR parts 144, 147, 149, and 156 as set
                forth below:
                PART 144--REQUIREMENTS RELATING TO HEALTH INSURANCE COVERAGE
                0
                12. The authority citation for part 144 is revised to read as follows:
                 Authority: 42 U.S.C. 300gg through 300gg-63, 300gg-91, 300gg-
                92, and 300gg-111 through 300gg-139, as amended.
                0
                13. Section 144.101 is amended by:
                0
                a. Redesignating paragraphs (d) and (e) as paragraphs (e) and (f),
                respectively; and
                0
                b. Adding new paragraph (d).
                 The addition reads as follows:
                Sec. 144.101 Basis and purpose.
                * * * * *
                 (d) Part 149 of this subchapter implements the provisions of parts
                D and E of title XXVII of the PHS Act that apply to group health plans,
                health insurance issuers in the group and individual markets, health
                care providers and facilities, and providers of air ambulance services.
                * * * * *
                0
                14. Section 144.102 is revised to read as follows:
                Sec. 144.102 Scope and applicability.
                 (a) For purposes of 45 CFR parts 144 through 149, all health
                insurance coverage is generally divided into two markets--the group
                market and the individual market. The group market is further divided
                into the large group market and the small group market.
                 (b) The protections afforded under 45 CFR parts 144 through 149 to
                individuals and employers (and other sponsors of health insurance
                offered in connection with a group health plan) are determined by
                whether the coverage involved is obtained in the small group market,
                the large group market, or the individual market.
                 (c) Coverage that is provided to associations, but not related to
                employment, and sold to individuals is not considered group coverage
                under 45 CFR parts 144 through 149. If the coverage is offered to an
                association member other than in connection with a group health plan,
                the coverage is considered individual health insurance coverage for
                purposes of 45 CFR parts 144 through 149. The coverage is considered
                coverage in the individual market, regardless of whether it is
                considered group coverage under state law. If the health insurance
                coverage is offered in connection with a group health plan as defined
                at 45 CFR 144.103, it is considered group health insurance coverage for
                purposes of 45 CFR parts 144 through 149.
                 (d) Provisions relating to CMS enforcement of parts 146, 147, 148,
                and 149 are contained in part 150 of this subchapter.
                0
                15. Section 144.103 is amended by revising the introductory text to
                read as follows:
                Sec. 144.103 Definitions.
                 For purposes of parts 146 (group market), 147 (group and individual
                market), 148 (individual market), 149 (surprise billing and
                transparency), and 150 (enforcement) of this subchapter, the following
                definitions apply unless otherwise provided:
                * * * * *
                PART 147--HEALTH INSURANCE REFORM REQUIREMENTS FOR THE GROUP AND
                INDIVIDUAL HEALTH INSURANCE MARKETS
                0
                16. The authority citation for part 147 is revised to read as follows:
                 Authority: 42 U.S.C. 300gg through 300gg-63, 300gg-91, 300gg-
                92, and 300gg-111 through 300gg-139, as amended, and section 3203,
                Pub. L. 116-136, 134 Stat. 281.
                0
                17. Section 147.138 is amended by revising paragraph (c) to read as
                follows:
                Sec. 147.138 Patient protections.
                * * * * *
                 (c) Applicability date. The provisions of this section are
                applicable to group health plans and health insurance issuers for plan
                years (in the individual market, policy years) beginning before January
                1, 2022. See also subparts B and D of part 149 of this subchapter for
                rules applicable with respect to plan years (in the individual market,
                policy years) beginning on or after January 1, 2022.
                0
                18. Add part 149 to read as follows:
                PART 149--SURPRISE BILLING AND TRANSPARENCY REQUIREMENTS
                Subpart A--General Provisions
                Sec.
                149.10 Basis and scope.
                149.20 Applicability.
                [[Page 36971]]
                149.30 Definitions.
                Subpart B--Protections against Balance Billing for the Group and
                Individual Health Insurance Markets
                149.110 Preventing surprise medical bills for emergency services.
                149.120 Preventing surprise medical bills for non-emergency services
                performed by nonparticipating providers at certain participating
                facilities.
                149.130 Preventing surprise medical bills for air ambulance
                services.
                149.140 Methodology for calculating qualifying payment amount.
                149.150 Complaints process for surprise medical bills regarding
                group health plans and group and individual health insurance
                coverage.
                Subpart C--[Reserved]
                Subpart D--Additional Patient Protections
                149.310 Choice of health care professional.
                Subpart E--Health Care Provider, Health Care Facility, and Air
                Ambulance Service Provider Requirements
                149.410 Balance billing in cases of emergency services.
                149.420 Balance billing in cases of non-emergency services performed
                by nonparticipating providers at certain participating health care
                facilities.
                149.430 Provider and facility disclosure requirements regarding
                patient protections against balance billing.
                149.440 Balance billing in cases of air ambulance services.
                149.450 Complaints process for balance billing regarding providers
                and facilities.
                 Authority: 42 U.S.C. 300gg-111 through 300gg-139, as amended.
                Subpart A--General Provisions
                Sec. 149.10 Basis and scope.
                 (a) Basis. This part implements parts D and E of title XXVII of the
                PHS Act.
                 (b) Scope. This part establishes standards for group health plans,
                health insurance issuers offering group or individual health insurance
                coverage, health care providers and facilities, and providers of air
                ambulance services with respect to surprise medical bills, transparency
                in health care coverage, and additional patient protections.
                Sec. 149.20 Applicability.
                 (a) In general. (1) The requirements in subparts B and D of this
                part apply to group health plans and health insurance issuers offering
                group or individual health insurance coverage (including grandfathered
                health plans as defined in Sec. 147.140 of this subchapter), except as
                specified in paragraph (b) of this section.
                 (2) The requirements in subpart E of this part apply to health care
                providers, health care facilities, and providers of air ambulance
                services.
                 (b) Exceptions. The requirements in subparts B and D of this part
                do not apply to the following:
                 (1) Excepted benefits as described in Sec. Sec. 146.145 and
                148.220 of this subchapter.
                 (2) Short-term, limited-duration insurance as defined in Sec.
                144.103 of this subchapter.
                 (3) Health reimbursement arrangements or other account-based group
                health plans as described in Sec. 147.126(d) of this subchapter.
                Sec. 149.30 Definitions.
                 The definitions in part 144 of this subchapter apply to this part,
                unless otherwise specified. In addition, for purposes of this part, the
                following definitions apply:
                 Air ambulance service means medical transport by a rotary wing air
                ambulance, as defined in 42 CFR 414.605, or fixed wing air ambulance,
                as defined in 42 CFR 414.605, for patients.
                 Cost sharing means the amount a participant, beneficiary, or
                enrollee is responsible for paying for a covered item or service under
                the terms of the group health plan or health insurance coverage. Cost
                sharing generally includes copayments, coinsurance, and amounts paid
                towards deductibles, but does not include amounts paid towards
                premiums, balance billing by out-of-network providers, or the cost of
                items or services that are not covered under a group health plan or
                health insurance coverage.
                 Emergency department of a hospital includes a hospital outpatient
                department that provides emergency services.
                 Emergency medical condition has the meaning given the term in Sec.
                149.110(c)(1).
                 Emergency services has the meaning given the term in Sec.
                149.110(c)(2).
                 Health care facility, with respect to a group health plan or group
                or individual health insurance coverage, in the context of non-
                emergency services, is each of the following:
                 (1) A hospital (as defined in section 1861(e) of the Social
                Security Act);
                 (2) A hospital outpatient department;
                 (3) A critical access hospital (as defined in section 1861(mm)(1)
                of the Social Security Act); and
                 (4) An ambulatory surgical center described in section
                1833(i)(1)(A) of the Social Security Act.
                 Independent freestanding emergency department means a health care
                facility (not limited to those described in the definition of health
                care facility with respect to non-emergency services) that--
                 (1) Is geographically separate and distinct and licensed separately
                from a hospital under applicable State law; and
                 (2) Provides any emergency services as described in Sec.
                149.110(c)(2)(i).
                 Nonparticipating emergency facility means an emergency department
                of a hospital, or an independent freestanding emergency department (or
                a hospital, with respect to services that pursuant to Sec.
                149.110(c)(2)(ii) are included as emergency services), that does not
                have a contractual relationship directly or indirectly with a group
                health plan or group or individual health insurance coverage offered by
                a health insurance issuer, with respect to the furnishing of an item or
                service under the plan or coverage, respectively.
                 Nonparticipating provider means any physician or other health care
                provider who does not have a contractual relationship directly or
                indirectly with a group health plan or group or individual health
                insurance coverage offered by a health insurance issuer, with respect
                to the furnishing of an item or service under the plan or coverage,
                respectively.
                 Notice of denial of payment means, with respect to an item or
                service for which benefits subject to the protections of Sec. Sec.
                149.110 through 149.130 are provided or covered, a written notice from
                the plan or issuer to the health care provider, facility, or provider
                of air ambulance services, as applicable, that payment for such item or
                service will not be made by the plan or coverage and which explains the
                reason for denial. The term notice of denial of payment does not
                include a notice of benefit denial due to an adverse benefit
                determination as defined in 29 CFR 2560.503-1.
                 Out-of-network rate means, with respect to an item or service
                furnished by a nonparticipating provider, nonparticipating emergency
                facility, or nonparticipating provider of air ambulance services--
                 (1) Subject to paragraph (3) of this definition, in a State that
                has in effect a specified State law, the amount determined in
                accordance with such law;
                 (2) Subject to paragraph (3) of this definition, in a State that
                does not have in effect a specified State law--
                 (i) Subject to paragraph (2)(ii) of this definition, if the
                nonparticipating provider or nonparticipating emergency facility and
                the plan or issuer agree on an amount of payment (including if the
                amount agreed upon is the initial payment sent by the plan or issuer
                under 26 CFR 54.9816-4T(b)(3)(iv)(A), 54.9816-5T(c)(3), or 54.9817-
                1T(b)(4)(i); 29 CFR 2590.716-4(b)(3)(iv)(A), 2590.716-5(c)(3), or
                2590.717-1(b)(4)(i);
                [[Page 36972]]
                or Sec. 149.110(b)(3)(iv)(A), Sec. 149.120(c)(3), or Sec.
                149.130(b)(4)(i), as applicable, or is agreed on through negotiations
                with respect to such item or service), such agreed on amount; or
                 (ii) If the nonparticipating provider or nonparticipating emergency
                facility and the plan or issuer enter into the independent dispute
                resolution (IDR) process under section 9816(c) or 9817(b) of the
                Internal Revenue Code, section 716(c) or 717(b) of ERISA, or section
                2799A-1(c) or 2799A-2(b) of the PHS Act, as applicable, and do not
                agree before the date on which a certified IDR entity makes a
                determination with respect to such item or service under such
                subsection, the amount of such determination; or
                 (3) In a State that has an All-Payer Model Agreement under section
                1115A of the Social Security Act that applies with respect to the plan
                or issuer; the nonparticipating provider or nonparticipating emergency
                facility; and the item or service, the amount that the State approves
                under the All-Payer Model Agreement for the item or service.
                 Participating emergency facility means any emergency department of
                a hospital, or an independent freestanding emergency department (or a
                hospital, with respect to services that pursuant to Sec.
                149.110(c)(2)(ii) are included as emergency services), that has a
                contractual relationship directly or indirectly with a group health
                plan or health insurance issuer offering group or individual health
                insurance coverage setting forth the terms and conditions on which a
                relevant item or service is provided to a participant, beneficiary, or
                enrollee under the plan or coverage, respectively. A single case
                agreement between an emergency facility and a plan or issuer that is
                used to address unique situations in which a participant, beneficiary,
                or enrollee requires services that typically occur out-of-network
                constitutes a contractual relationship for purposes of this definition,
                and is limited to the parties to the agreement.
                 Participating health care facility means any health care facility
                described in this section that has a contractual relationship directly
                or indirectly with a group health plan or health insurance issuer
                offering group or individual health insurance coverage setting forth
                the terms and conditions on which a relevant item or service is
                provided to a participant, beneficiary, or enrollee under the plan or
                coverage, respectively. A single case agreement between a health care
                facility and a plan or issuer that is used to address unique situations
                in which a participant, beneficiary, or enrollee requires services that
                typically occur out-of-network constitutes a contractual relationship
                for purposes of this definition, and is limited to the parties to the
                agreement.
                 Participating provider means any physician or other health care
                provider who has a contractual relationship directly or indirectly with
                a group health plan or health insurance issuer offering group or
                individual health insurance coverage setting forth the terms and
                conditions on which a relevant item or service is provided to a
                participant, beneficiary, or enrollee under the plan or coverage,
                respectively.
                 Physician or health care provider means a physician or other health
                care provider who is acting within the scope of practice of that
                provider's license or certification under applicable State law, but
                does not include a provider of air ambulance services.
                 Provider of air ambulance services means an entity that is licensed
                under applicable State and Federal law to provide air ambulance
                services.
                 Same or similar item or service has the meaning given the term in
                Sec. 149.140(a)(13).
                 Service code has the meaning given the term in Sec.
                149.140(a)(14).
                 Qualifying payment amount has the meaning given the term in Sec.
                149.140(a)(16).
                 Recognized amount means, with respect to an item or service
                furnished by a nonparticipating provider or nonparticipating emergency
                facility--
                 (1) Subject to paragraph (3) of this definition, in a State that
                has in effect a specified State law, the amount determined in
                accordance with such law.
                 (2) Subject to paragraph (3) of this definition, in a State that
                does not have in effect a specified State law, the lesser of--
                 (i) The amount that is the qualifying payment amount (as determined
                in accordance with Sec. 149.140); or
                 (ii) The amount billed by the provider or facility.
                 (3) In a State that has an All-Payer Model Agreement under section
                1115A of the Social Security Act that applies with respect to the plan
                or issuer; the nonparticipating provider or nonparticipating emergency
                facility; and the item or service, the amount that the State approves
                under the All-Payer Model Agreement for the item or service.
                 Specified State law means a State law that provides for a method
                for determining the total amount payable under a group health plan or
                group or individual health insurance coverage offered by a health
                insurance issuer to the extent such State law applies for an item or
                service furnished by a nonparticipating provider or nonparticipating
                emergency facility (including where it applies because the State has
                allowed a plan that is not otherwise subject to applicable State law an
                opportunity to opt in, subject to section 514 of the Employee
                Retirement Income Security Act of 1974). A group health plan that opts
                in to such a specified State law must do so for all items and services
                to which the specified State law applies and in a manner determined by
                the applicable State authority, and must prominently display in its
                plan materials describing the coverage of out-of-network services a
                statement that the plan has opted into the specified State law,
                identify the relevant State (or States), and include a general
                description of the items and services provided by nonparticipating
                facilities and providers that are covered by the specified State law.
                 State means each of the 50 States, the District of Columbia, Puerto
                Rico, the Virgin Islands, Guam, American Samoa, and the Northern
                Mariana Islands.
                 Treating provider is a physician or health care provider who has
                evaluated the individual.
                 Visit, with respect to items and services furnished to an
                individual at a health care facility, includes, in addition to items
                and services furnished by a provider at the facility, equipment and
                devices, telemedicine services, imaging services, laboratory services,
                and preoperative and postoperative services, regardless of whether the
                provider furnishing such items or services is at the facility.
                Subpart B--Protections Against Balance Billing for the Group and
                Individual Health Insurance Markets
                Sec. 149.110 Preventing surprise medical bills for emergency
                services.
                 (a) In general. If a group health plan, or a health insurance
                issuer offering group or individual health insurance coverage, provides
                or covers 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, the plan or issuer must
                cover emergency services, as defined in paragraph (c)(2) of this
                section, and this coverage must be provided in accordance with
                paragraph (b) of this section.
                 (b) Coverage requirements. A plan or issuer described in paragraph
                (a) of this section must provide coverage for emergency services in the
                following manner--
                [[Page 36973]]
                 (1) Without the need for any prior authorization determination,
                even if the services are provided on an out-of-network basis.
                 (2) Without regard to whether the health care provider furnishing
                the emergency services is a participating provider or a participating
                emergency facility, as applicable, with respect to the services.
                 (3) If the emergency services are provided by a nonparticipating
                provider or a nonparticipating emergency facility--
                 (i) Without imposing any administrative requirement or limitation
                on coverage that is more restrictive than the requirements or
                limitations that apply to emergency services received from
                participating providers and participating emergency facilities.
                 (ii) Without imposing cost-sharing requirements that are greater
                than the requirements that would apply if the services were provided by
                a participating provider or a participating emergency facility.
                 (iii) By calculating the cost-sharing requirement as if the total
                amount that would have been charged for the services by such
                participating provider or participating emergency facility were equal
                to the recognized amount for such services.
                 (iv) The plan or issuer--
                 (A) Not later than 30 calendar days after the bill for the services
                is transmitted by the provider or facility (or, in cases where the
                recognized amount is determined by a specified State law or All-Payer
                Model Agreement, such other timeframe as specified by the State law or
                All-Payer Model Agreement), determines whether the services are covered
                under the plan or coverage and, if the services are covered, sends to
                the provider or facility, as applicable, an initial payment or a notice
                of denial of payment. For purposes of this paragraph (b)(3)(iv)(A), the
                30-calendar-day period begins on the date the plan or issuer receives
                the information necessary to decide a claim for payment for the
                services.
                 (B) Pays a total plan or coverage payment directly to the
                nonparticipating provider or nonparticipating facility that is equal to
                the amount by which the out-of-network rate for the services exceeds
                the cost-sharing amount for the services (as determined in accordance
                with paragraphs (b)(3)(ii) and (iii) of this section), less any initial
                payment amount made under paragraph (b)(3)(iv)(A) of this section. The
                total plan or coverage payment must be made in accordance with the
                timing requirement described in section 2799A-1(c)(6) of the PHS Act,
                or in cases where the out-of-network rate is determined under a
                specified State law or All-Payer Model Agreement, such other timeframe
                as specified by the State law or All-Payer Model Agreement.
                 (v) By counting any cost-sharing payments made by the participant,
                beneficiary, or enrollee with respect to the emergency services toward
                any in-network deductible or in-network out-of-pocket maximums
                (including the annual limitation on cost sharing under section 2707(b)
                of the PHS Act) (as applicable) applied under the plan or coverage (and
                the in-network deductible and in-network out-of-pocket maximums must be
                applied) in the same manner as if the cost-sharing payments were made
                with respect to emergency services furnished by a participating
                provider or a participating emergency facility.
                 (4) Without limiting what constitutes an emergency medical
                condition (as defined in paragraph (c)(1) of this section) solely on
                the basis of diagnosis codes.
                 (5) Without regard to any other term or condition of the coverage,
                other than--
                 (i) The exclusion or coordination of benefits (to the extent not
                inconsistent with benefits for an emergency medical condition, as
                defined in paragraph (c)(1) of this section).
                 (ii) An affiliation or waiting period (each as defined in Sec.
                144.103 of this subchapter).
                 (iii) Applicable cost sharing.
                 (c) Definitions. In this section--
                 (1) Emergency medical condition means a medical condition,
                including a mental health condition or substance use disorder,
                manifesting itself by acute symptoms of sufficient severity (including
                severe pain) such that a prudent layperson, who possesses an average
                knowledge of health and medicine, could reasonably expect the absence
                of immediate medical attention to result in a condition described in
                clause (i), (ii), or (iii) of section 1867(e)(1)(A) of the Social
                Security Act (42 U.S.C. 1395dd(e)(1)(A)). (In that provision of the
                Social Security Act, clause (i) refers to placing the health of the
                individual (or, with respect to a pregnant woman, the health of the
                woman or her unborn child) in serious jeopardy; clause (ii) refers to
                serious impairment to bodily functions; and clause (iii) refers to
                serious dysfunction of any bodily organ or part.)
                 (2) Emergency services means, with respect to an emergency medical
                condition--
                 (i) In general. (A) An appropriate medical screening examination
                (as required under section 1867 of the Social Security Act (42 U.S.C.
                1395dd) or as would be required under such section if such section
                applied to an independent freestanding emergency department) that is
                within the capability of the emergency department of a hospital or of
                an independent freestanding emergency department, as applicable,
                including ancillary services routinely available to the emergency
                department to evaluate such emergency medical condition; and
                 (B) Within the capabilities of the staff and facilities available
                at the hospital or the independent freestanding emergency department,
                as applicable, such further medical examination and treatment as are
                required under section 1867 of the Social Security Act (42 U.S.C.
                1395dd), or as would be required under such section if such section
                applied to an independent freestanding emergency department, to
                stabilize the patient (regardless of the department of the hospital in
                which such further examination or treatment is furnished).
                 (ii) Inclusion of additional services. (A) Subject to paragraph
                (c)(2)(ii)(B) of this section, items and services--
                 (1) For which benefits are provided or covered under the plan or
                coverage; and
                 (2) That are furnished by a nonparticipating provider or
                nonparticipating emergency facility (regardless of the department of
                the hospital in which such items or services are furnished) after the
                participant, beneficiary, or enrollee is stabilized and as part of
                outpatient observation or an inpatient or outpatient stay with respect
                to the visit in which the services described in paragraph (c)(2)(i) of
                this section are furnished.
                 (B) Items and services described in paragraph (c)(2)(ii)(A) of this
                section are not included as emergency services if all of the conditions
                in Sec. 149.410(b) are met.
                 (3) To stabilize, with respect to an emergency medical condition,
                has the meaning given such term in section 1867(e)(3) of the Social
                Security Act (42 U.S.C. 1395dd(e)(3)).
                 (d) Applicability date. The provisions of this section are
                applicable with respect to plan years (in the individual market, policy
                years) beginning on or after January 1, 2022.
                Sec. 149.120 Preventing surprise medical bills for non-emergency
                services performed by nonparticipating providers at certain
                participating facilities.
                 (a) In general. If a group health plan, or a health insurance
                issuer offering group or individual health insurance coverage, provides
                or covers any benefits with respect to items and
                [[Page 36974]]
                services described in paragraph (b) of this section, the plan or issuer
                must cover the items and services when furnished by a nonparticipating
                provider in accordance with paragraph (c) of this section.
                 (b) Items and services described. The items and services described
                in this paragraph (b) are items and services (other than emergency
                services) furnished to a participant, beneficiary, or enrollee by a
                nonparticipating provider with respect to a visit at a participating
                health care facility, unless the provider has satisfied the notice and
                consent criteria of Sec. 149.420(c) through (i) with respect to such
                items and services.
                 (c) Coverage requirements. In the case of items and services
                described in paragraph (b) of this section, the plan or issuer--
                 (1) Must not impose a cost-sharing requirement for the items and
                services that is greater than the cost-sharing requirement that would
                apply if the items or services had been furnished by a participating
                provider.
                 (2) Must calculate the cost-sharing requirements as if the total
                amount that would have been charged for the items and services by such
                participating provider were equal to the recognized amount for the
                items and services.
                 (3) Not later than 30 calendar days after the bill for the items or
                services is transmitted by the provider (or in cases where the
                recognized amount is determined by a specified State law or All-Payer
                Model Agreement, such other timeframe as specified under the State law
                or All-Payer Model Agreement), must determine whether the items and
                services are covered under the plan or coverage and, if the items and
                services are covered, send to the provider an initial payment or a
                notice of denial of payment. For purposes of this paragraph (c)(3), the
                30-calendar-day period begins on the date the plan or issuer receives
                the information necessary to decide a claim for payment for the items
                or services.
                 (4) Must pay a total plan or coverage payment directly to the
                nonparticipating provider that is equal to the amount by which the out-
                of-network rate for the items and services involved exceeds the cost-
                sharing amount for the items and services (as determined in accordance
                with paragraphs (c)(1) and (2) of this section), less any initial
                payment amount made under paragraph (c)(3) of this section. The total
                plan or coverage payment must be made in accordance with the timing
                requirement described in section 2799A-1(c)(6) of the PHS Act, or in
                cases where the out-of-network rate is determined under a specified
                State law or All-Payer Model Agreement, such other timeframe as
                specified by the State law or All-Payer Model Agreement.
                 (5) Must count any cost-sharing payments made by the participant,
                beneficiary, or enrollee toward any in-network deductible and in-
                network out-of-pocket maximums (including the annual limitation on cost
                sharing under section 2707(b) of the PHS Act) (as applicable) applied
                under the plan or coverage (and the in-network deductible and out-of-
                pocket maximums must be applied) in the same manner as if such cost-
                sharing payments were made with respect to items and services furnished
                by a participating provider.
                 (d) Applicability date. The provisions of this section are
                applicable with respect to plan years (in the individual market, policy
                years) beginning on or after January 1, 2022.
                Sec. 149.130 Preventing surprise medical bills for air ambulance
                services.
                 (a) In general. If a group health plan, or a health insurance
                issuer offering group or individual health insurance coverage, provides
                or covers any benefits for air ambulance services, the plan or issuer
                must cover such services from a nonparticipating provider of air
                ambulance services in accordance with paragraph (b) of this section.
                 (b) Coverage requirements. A plan or issuer described in paragraph
                (a) of this section must provide coverage of air ambulance services in
                the following manner--
                 (1) The cost-sharing requirements with respect to the services must
                be the same requirements that would apply if the services were provided
                by a participating provider of air ambulance services.
                 (2) The cost-sharing requirement must be calculated as if the total
                amount that would have been charged for the services by a participating
                provider of air ambulance services were equal to the lesser of the
                qualifying payment amount (as determined in accordance with Sec.
                149.140) or the billed amount for the services.
                 (3) The cost-sharing amounts must be counted towards any in-network
                deductible and in-network out-of-pocket maximums (including the annual
                limitation on cost sharing under section 2707(b) of the PHS Act) (as
                applicable) applied under the plan or coverage (and the in-network
                deductible and out-of-pocket maximums must be applied) in the same
                manner as if the cost-sharing payments were made with respect to
                services furnished by a participating provider of air ambulance
                services.
                 (4) The plan or issuer must--
                 (i) Not later than 30 calendar days after the bill for the services
                is transmitted by the provider of air ambulance services, determine
                whether the services are covered under the plan or coverage and, if the
                services are covered, send to the provider an initial payment or a
                notice of denial of payment. For purposes of this paragraph (b)(4)(i),
                the 30-calendar-day period begins on the date the plan or issuer
                receives the information necessary to decide a claim for payment for
                the services.
                 (ii) Pay a total plan or coverage payment directly to the
                nonparticipating provider furnishing such air ambulance services that
                is equal to the amount by which the out-of-network rate for the
                services exceeds the cost-sharing amount for the services (as
                determined in accordance with paragraphs (b)(1) and (2) of this
                section), less any initial payment amount made under paragraph
                (b)(4)(i) of this section. The total plan or coverage payment must be
                made in accordance with the timing requirement described in section
                2799A-2(b)(6) of the PHS Act, or in cases where the out-of-network rate
                is determined under a specified State law or All-Payer Model Agreement,
                such other timeframe as specified by the State law or All-Payer Model
                Agreement.
                 (c) Applicability date. The provisions of this section are
                applicable with respect to plan years (in the individual market, policy
                years) beginning on or after January 1, 2022.
                Sec. 149.140 Methodology for calculating qualifying payment amount.
                 (a) Definitions. For purposes of this section, the following
                definitions apply:
                 (1) Contracted rate means the total amount (including cost sharing)
                that a group health plan or health insurance issuer has contractually
                agreed to pay a participating provider, facility, or provider of air
                ambulance services for covered items and services, whether directly or
                indirectly, including through a third-party administrator or pharmacy
                benefit manager. Solely for purposes of this definition, a single case
                agreement, letter of agreement, or other similar arrangement between a
                provider, facility, or air ambulance provider and a plan or issuer,
                used to supplement the network of the plan or coverage for a specific
                participant, beneficiary, or enrollee in unique circumstances, does not
                constitute a contract.
                 (2) Derived amount has the meaning given the term in Sec. 147.210
                of this subchapter.
                 (3) Eligible database means--
                 (i) A State all-payer claims database; or
                [[Page 36975]]
                 (ii) Any third-party database which--
                 (A) Is not affiliated with, or owned or controlled by, any health
                insurance issuer, or a health care provider, facility, or provider of
                air ambulance services (or any member of the same controlled group as,
                or under common control with, such an entity). For purposes of this
                paragraph (a)(3)(ii)(A), the term controlled group means a group of two
                or more persons that is treated as a single employer under sections
                52(a), 52(b), 414(m), or 414(o) of the Internal Revenue Code of 1986,
                as amended;
                 (B) Has sufficient information reflecting in-network amounts paid
                by group health plans or health insurance issuers offering group or
                individual health insurance coverage to providers, facilities, or
                providers of air ambulance services for relevant items and services
                furnished in the applicable geographic region; and
                 (C) Has the ability to distinguish amounts paid to participating
                providers and facilities by commercial payers, such as group health
                plans and health insurance issuers offering group or individual health
                insurance coverage, from all other claims data, such as amounts billed
                by nonparticipating providers or facilities and amounts paid by public
                payers, including the Medicare program under title XVIII of the Social
                Security Act, the Medicaid program under title XIX of the Social
                Security Act (or a demonstration project under title XI of the Social
                Security Act), or the Children's Health Insurance Program under title
                XXI of the Social Security Act.
                 (4) Facility of the same or similar facility type means, with
                respect to emergency services, either--
                 (i) An emergency department of a hospital; or
                 (ii) An independent freestanding emergency department.
                 (5) First coverage year means, with respect to an item or service
                for which coverage is not offered in 2019 under a group health plan or
                group or individual health insurance coverage offered by a health
                insurance issuer, the first year after 2019 for which coverage for such
                item or service is offered under that plan or coverage.
                 (6) First sufficient information year means, with respect to a
                group health plan or group or individual health insurance coverage
                offered by a health insurance issuer--
                 (i) In the case of an item or service for which the plan or
                coverage does not have sufficient information to calculate the median
                of the contracted rates described in paragraph (b) of this section in
                2019, the first year after 2022 for which the plan or issuer has
                sufficient information to calculate the median of such contracted rates
                in the year immediately preceding that first year after 2022; and
                 (ii) In the case of a newly covered item or service, the first year
                after the first coverage year for such item or service with respect to
                such plan or coverage for which the plan or issuer has sufficient
                information to calculate the median of the contracted rates described
                in paragraph (b) of this section in the year immediately preceding that
                first year.
                 (7) Geographic region means--
                 (i) For items and services other than air ambulance services--
                 (A) Subject to paragraphs (a)(7)(i)(B) and (C) of this section, one
                region for each metropolitan statistical area, as described by the U.S.
                Office of Management and Budget and published by the U.S. Census
                Bureau, in a State, and one region consisting of all other portions of
                the State.
                 (B) If a plan or issuer does not have sufficient information to
                calculate the median of the contracted rates described in paragraph (b)
                of this section for an item or service provided in a geographic region
                described in paragraph (a)(7)(i)(A) of this section, one region
                consisting of all metropolitan statistical areas, as described by the
                U.S. Office of Management and Budget and published by the U.S. Census
                Bureau, in the State, and one region consisting of all other portions
                of the State.
                 (C) If a plan or issuer does not have sufficient information to
                calculate the median of the contracted rates described in paragraph (b)
                of this section for an item or service provided in a geographic region
                described in paragraph (a)(7)(i)(B) of this section, one region
                consisting of all metropolitan statistical areas, as described by the
                U.S. Office of Management and Budget and published by the U.S. Census
                Bureau, in each Census division and one region consisting of all other
                portions of the Census division, as described by the U.S. Census
                Bureau.
                 (ii) For air ambulance services--
                 (A) Subject to paragraph (a)(7)(ii)(B) of this section, one region
                consisting of all metropolitan statistical areas, as described by the
                U.S. Office of Management and Budget and published by the U.S. Census
                Bureau, in the State, and one region consisting of all other portions
                of the State, determined based on the point of pick-up (as defined in
                42 CFR 414.605).
                 (B) If a plan or issuer does not have sufficient information to
                calculate the median of the contracted rates described in paragraph (b)
                of this section for an air ambulance service provided in a geographic
                region described in paragraph (a)(7)(ii)(A) of this section, one region
                consisting of all metropolitan statistical areas, as described by the
                U.S. Office of Management and Budget and published by the U.S. Census
                Bureau, in each Census division and one region consisting of all other
                portions of the Census division, as described by the U.S. Census
                Bureau, determined based on the point of pick-up (as defined in 42 CFR
                414.605).
                 (8) Insurance market is, irrespective of the State, one of the
                following:
                 (i) The individual market (other than short-term, limited-duration
                insurance or individual health insurance coverage that consists solely
                of excepted benefits).
                 (ii) The large group market (other than coverage that consists
                solely of excepted benefits).
                 (iii) The small group market (other than coverage that consists
                solely of excepted benefits).
                 (iv) In the case of a self-insured group health plan, all self-
                insured group health plans (other than account-based plans, as defined
                in Sec. 147.126(d)(6)(i) of this subchapter, and plans that consist
                solely of excepted benefits) of the same plan sponsor, or at the option
                of the plan sponsor, all self-insured group health plans administered
                by the same entity (including a third-party administrator contracted by
                the plan), to the extent otherwise permitted by law, that is
                responsible for calculating the qualifying payment amount on behalf of
                the plan.
                 (9) Modifiers mean codes applied to the service code that provide a
                more specific description of the furnished item or service and that may
                adjust the payment rate or affect the processing or payment of the code
                billed.
                 (10) Newly covered item or service means an item or service for
                which coverage was not offered in 2019 under a group health plan or
                group or individual health insurance coverage offered by a health
                insurance issuer, but that is offered under the plan or coverage in a
                year after 2019.
                 (11) New service code means a service code that was created or
                substantially revised in a year after 2019.
                 (12) Provider in the same or similar specialty means the practice
                specialty of a provider, as identified by the plan or issuer consistent
                with the plan's or issuer's usual business practice, except that, with
                respect to air ambulance services, all providers of air ambulance
                services are considered to be a single provider specialty.
                 (13) Same or similar item or service means a health care item or
                service billed under the same service code, or
                [[Page 36976]]
                a comparable code under a different procedural code system.
                 (14) Service code means the code that describes an item or service
                using the Current Procedural Terminology (CPT) code, Healthcare Common
                Procedure Coding System (HCPCS), or Diagnosis-Related Group (DRG)
                codes.
                 (15) Sufficient information means, for purposes of determining
                whether a group health plan or health insurance issuer offering group
                or individual health insurance coverage has sufficient information to
                calculate the median of the contracted rates described in paragraph (b)
                of this section--
                 (i) The plan or issuer has at least three contracted rates on
                January 31, 2019, to calculate the median of the contracted rates in
                accordance with paragraph (b) of this section; or
                 (ii) For an item or service furnished during a year after 2022 that
                is used to determine the first sufficient information year--
                 (A) The plan or issuer has at least three contracted rates on
                January 31 of the year immediately preceding that year to calculate the
                median of the contracted rates in accordance with paragraph (b) of this
                section; and
                 (B) The contracted rates under paragraph (a)(15)(ii)(A) of this
                section account (or are reasonably expected to account) for at least 25
                percent of the total number of claims paid for that item or service for
                that year with respect to all plans of the sponsor (or the
                administering entity as provided in paragraph (a)(8)(iv) of this
                section, if applicable) or all coverage offered by the issuer that are
                offered in the same insurance market.
                 (16) Qualifying payment amount means, with respect to a sponsor of
                a group health plan or health insurance issuer offering group or
                individual health insurance coverage, the amount calculated using the
                methodology described in paragraph (c) of this section.
                 (17) Underlying fee schedule rate means the rate for a covered item
                or service from a particular participating provider, providers, or
                facility that a group health plan or health insurance issuer uses to
                determine a participant's, beneficiary's, or enrollee's cost-sharing
                liability for the item or service, when that rate is different from the
                contracted rate.
                 (b) Methodology for calculation of median contracted rate--(1) In
                general. The median contracted rate for an item or service is
                calculated by arranging in order from least to greatest the contracted
                rates of all group health plans of the plan sponsor (or the
                administering entity as provided in paragraph (a)(8)(iv) of this
                section, if applicable) or all group or individual health insurance
                coverage offered by the issuer in the same insurance market for the
                same or similar item or service that is provided by a provider in the
                same or similar specialty or facility of the same or similar facility
                type and provided in the geographic region in which the item or service
                is furnished and selecting the middle number. If there are an even
                number of contracted rates, the median contracted rate is the average
                of the middle two contracted rates. In determining the median
                contracted rate, the amount negotiated under each contract is treated
                as a separate amount. If a plan or issuer has a contract with a
                provider group or facility, the rate negotiated with that provider
                group or facility under the contract is treated as a single contracted
                rate if the same amount applies with respect to all providers of such
                provider group or facility under the single contract. However, if a
                plan or issuer has a contract with multiple providers, with separate
                negotiated rates with each particular provider, each unique contracted
                rate with an individual provider constitutes a single contracted rate.
                Further, if a plan or issuer has separate contracts with individual
                providers, the contracted rate under each such contract constitutes a
                single contracted rate (even if the same amount is paid to multiple
                providers under separate contracts).
                 (2) Calculation rules. In calculating the median contracted rate, a
                plan or issuer must:
                 (i) Calculate the median contracted rate with respect to all plans
                of such sponsor (or the administering entity as provided in paragraph
                (a)(8)(iv) of this section, if applicable) or all coverage offered by
                such issuer that are offered in the same insurance market;
                 (ii) Calculate the median contracted rate using the full contracted
                rate applicable to the service code, except that the plan or issuer
                must--
                 (A) Calculate separate median contracted rates for CPT code
                modifiers ``26'' (professional component) and ``TC'' (technical
                component);
                 (B) For anesthesia services, calculate a median contracted rate for
                the anesthesia conversion factor for each service code;
                 (C) For air ambulance services, calculate a median contracted rate
                for the air mileage service codes (A0435 and A0436); and
                 (D) Where contracted rates otherwise vary based on applying a
                modifier code, calculate a separate median contracted rate for each
                such service code-modifier combination;
                 (iii) In the case of payments made by a plan or issuer that are not
                on a fee-for-service basis (such as bundled or capitation payments),
                calculate a median contracted rate for each item or service using the
                underlying fee schedule rates for the relevant items or services. If
                the plan or issuer does not have an underlying fee schedule rate for
                the item or service, it must use the derived amount to calculate the
                median contracted rate; and
                 (iv) Exclude risk sharing, bonus, penalty, or other incentive-based
                or retrospective payments or payment adjustments.
                 (3) Provider specialties; facility types. (i) If a plan or issuer
                has contracted rates that vary based on provider specialty for a
                service code, the median contracted rate is calculated separately for
                each provider specialty, as applicable.
                 (ii) If a plan or issuer has contracted rates for emergency
                services that vary based on facility type for a service code, the
                median contracted rate is calculated separately for each facility of
                the same or similar facility type.
                 (c) Methodology for calculation of the qualifying payment amount--
                (1) In general. (i) For an item or service (other than items or
                services described in paragraphs (c)(1)(iii) through (vii) of this
                section) furnished during 2022, the plan or issuer must calculate the
                qualifying payment amount by increasing the median contracted rate (as
                determined in accordance with paragraph (b) of this section) for the
                same or similar item or service under such plans or coverage,
                respectively, on January 31, 2019, by the combined percentage increase
                as published by the Department of the Treasury and the Internal Revenue
                Service to reflect the percentage increase in the CPI-U over 2019, such
                percentage increase over 2020, and such percentage increase over 2021.
                 (A) The combined percentage increase for 2019, 2020, and 2021 will
                be published in guidance by the Internal Revenue Service. The
                Department of the Treasury and the Internal Revenue Service will
                calculate the percentage increase using the CPI-U published by the
                Bureau of Labor Statistics of the Department of Labor.
                 (B) For purposes of this paragraph (c)(1)(i), the CPI-U for each
                calendar year is the average of the CPI-U as of the close of the 12-
                month period ending on August 31 of the calendar year, rounded to 10
                decimal places.
                 (C) The combined percentage increase for 2019, 2020, and 2021 will
                be calculated as:
                (CPI-U 2019/CPI-U 2018) x (CPI-U 2020/CPI-U 2019) x (CPI-U 2021/CPI-U
                2020)
                [[Page 36977]]
                 (ii) For an item or service (other than items or services described
                in paragraphs (c)(1)(iii) through (vii) of this section) furnished
                during 2023 or a subsequent year, the plan or issuer must calculate the
                qualifying payment amount by increasing the qualifying payment amount
                determined under paragraph (c)(1)(i) of this section, for such an item
                or service furnished in the immediately preceding year, by the
                percentage increase as published by the Department of the Treasury and
                the Internal Revenue Service.
                 (A) The percentage increase for any year after 2022 will be
                published in guidance by the Internal Revenue Service. The Department
                of the Treasury and Internal Revenue Service will calculate the
                percentage increase using the CPI-U published by the Bureau of Labor
                Statistics of the Department of Labor.
                 (B) For purposes of this paragraph (c)(1)(ii), the CPI-U for each
                calendar year is the average of the CPI-U as of the close of the 12-
                month period ending on August 31 of the calendar year, rounded to 10
                decimal places.
                 (C) The combined percentage increase for any year will be
                calculated as CPI-U present year/CPI-U prior year.
                 (iii) For anesthesia services furnished during 2022, the plan or
                issuer must calculate the qualifying payment amount by first increasing
                the median contracted rate for the anesthesia conversion factor (as
                determined in accordance with paragraph (b) of this section) for the
                same or similar item or service under such plans or coverage,
                respectively, on January 31, 2019, in accordance with paragraph
                (c)(1)(i) of this section (referred to in this section as the indexed
                median contracted rate for the anesthesia conversion factor). The plan
                or issuer must then multiply the indexed median contracted rate for the
                anesthesia conversion factor by the sum of the base unit, time unit,
                and physical status modifier units of the participant, beneficiary, or
                enrollee to whom anesthesia services are furnished to determine the
                qualifying payment amount.
                 (A) The base units for an anesthesia service code are the base
                units for that service code specified in the most recent edition (as of
                the date of service) of the American Society of Anesthesiologists
                Relative Value Guide.
                 (B) The time unit is measured in 15-minute increments or a fraction
                thereof.
                 (C) The physical status modifier on a claim is a standard modifier
                describing the physical status of the patient and is used to
                distinguish between various levels of complexity of the anesthesia
                services provided, and is expressed as a unit with a value between zero
                (0) and three (3).
                 (D) The anesthesia conversion factor is expressed in dollars per
                unit and is a contracted rate negotiated with the plan or issuer.
                 (iv) For anesthesia services furnished during 2023 or a subsequent
                year, the plan or issuer must calculate the qualifying payment amount
                by first increasing the indexed median contracted rate for the
                anesthesia conversion factor, determined under paragraph (c)(1)(iii) of
                this section for such services furnished in the immediately preceding
                year, in accordance with paragraph (c)(1)(ii) of this section. The plan
                or issuer must then multiply that amount by the sum of the base unit,
                time unit, and physical status modifier units for the participant,
                beneficiary, or enrollee to whom anesthesia services are furnished to
                determine the qualifying payment amount.
                 (v) For air ambulance services billed using the air mileage service
                codes (A0435 and A0436) that are furnished during 2022, the plan or
                issuer must calculate the qualifying payment amount for services billed
                using the air mileage service codes by first increasing the median
                contracted rate (as determined in accordance with paragraph (b) of this
                section), in accordance with paragraph (c)(1)(i) of this section
                (referred to in this section as the indexed median air mileage rate).
                The plan or issuer must then multiply the indexed median air mileage
                rate by the number of loaded miles provided to the participant,
                beneficiary, or enrollee to determine the qualifying payment amount.
                 (A) The air mileage rate is expressed in dollars per loaded mile
                flown, is expressed in statute miles (not nautical miles), and is a
                contracted rate negotiated with the plan or issuer.
                 (B) The number of loaded miles is the number of miles a patient is
                transported in the air ambulance vehicle.
                 (C) The qualifying payment amount for other service codes
                associated with air ambulance services is calculated in accordance with
                paragraphs (c)(1)(i) and (ii) of this section.
                 (vi) For air ambulance services billed using the air mileage
                service codes (A0435 and A0436) that are furnished during 2023 or a
                subsequent year, the plan or issuer must calculate the qualifying
                payment amount by first increasing the indexed median air mileage rate,
                determined under paragraph (c)(1)(v) of this section for such services
                furnished in the immediately preceding year, in accordance with
                paragraph (c)(1)(ii) of this section. The plan or issuer must then
                multiply the indexed median air mileage rate by the number of loaded
                miles provided to the participant, beneficiary, or enrollee to
                determine the qualifying payment amount.
                 (vii) For any other items or services for which a plan or issuer
                generally determines payment for the same or similar items or services
                by multiplying a contracted rate by another unit value, the plan or
                issuer must calculate the qualifying payment amount using a methodology
                that is similar to the methodology required under paragraphs
                (c)(1)(iii) through (vi) of this section and reasonably reflects the
                payment methodology for same or similar items or services.
                 (2) New plans and coverage. With respect to a sponsor of a group
                health plan or health insurance issuer offering group or individual
                health insurance coverage in a geographic region in which the sponsor
                or issuer, respectively, did not offer any group health plan or health
                insurance coverage during 2019--
                 (i) For the first year in which the group health plan, group health
                insurance coverage, or individual health insurance coverage,
                respectively, is offered in such region--
                 (A) If the plan or issuer has sufficient information to calculate
                the median of the contracted rates described in paragraph (b) of this
                section, the plan or issuer must calculate the qualifying payment
                amount in accordance with paragraph (c)(1) of this section for items
                and services that are covered by the plan or coverage and furnished
                during the first year; and
                 (B) If the plan or issuer does not have sufficient information to
                calculate the median of the contracted rates described in paragraph (b)
                of this section for an item or service provided in a geographic region,
                the plan or issuer must determine the qualifying payment amount for the
                item or service in accordance with paragraph (c)(3)(i) of this section.
                 (ii) For each subsequent year the group health plan, group health
                insurance coverage, or individual health insurance coverage,
                respectively, is offered in the region, the plan or issuer must
                calculate the qualifying payment amount by increasing the qualifying
                payment amount determined under this paragraph (c)(2) for the items and
                services furnished in the immediately preceding year, in accordance
                with paragraph (c)(1)(ii), (iv), or (vi) of this section, as
                applicable.
                 (3) Insufficient information; newly covered items and services. In
                the case of a plan or issuer that does not have
                [[Page 36978]]
                sufficient information to calculate the median of the contracted rates
                described in paragraph (b) of this section in 2019 (or, in the case of
                a newly covered item or service, in the first coverage year for such
                item or service with respect to such plan or coverage if the plan or
                issuer does not have sufficient information) for an item or service
                provided in a geographic region--
                 (i) For an item or service furnished during 2022 (or, in the case
                of a newly covered item or service, during the first coverage year for
                the item or service with respect to the plan or coverage), the plan or
                issuer must calculate the qualifying payment amount by first
                identifying the rate that is equal to the median of the in-network
                allowed amounts for the same or similar item or service provided in the
                geographic region in the year immediately preceding the year in which
                the item or service is furnished (or, in the case of a newly covered
                item or service, the year immediately preceding such first coverage
                year) determined by the plan or issuer, respectively, through use of
                any eligible database, and then increasing that rate by the percentage
                increase in the CPI-U over such preceding year. For purposes of this
                section, in cases in which an eligible database is used to determine
                the qualifying payment amount with respect to an item or service
                furnished during a calendar year, the plan or issuer must use the same
                database for determining the qualifying payment amount for that item or
                service furnished through the last day of the calendar year, and if a
                different database is selected for some items or services, the basis
                for that selection must be one or more factors not directly related to
                the rate of those items or services (such as sufficiency of data for
                those items or services).
                 (ii) For an item or service furnished in a subsequent year (before
                the first sufficient information year for such item or service with
                respect to such plan or coverage), the plan or issuer must calculate
                the qualifying payment amount by increasing the qualifying payment
                amount determined under paragraph (c)(3)(i) of this section or this
                paragraph (c)(3)(ii), as applicable, for such item or service for the
                year immediately preceding such subsequent year, by the percentage
                increase in CPI-U over such preceding year;
                 (iii) For an item or service furnished in the first sufficient
                information year for such item or service with respect to such plan or
                coverage, the plan or issuer must calculate the qualifying payment
                amount in accordance with paragraph (c)(1)(i), (iii), or (v) of this
                section, as applicable, except that in applying such paragraph to such
                item or service, the reference to `furnished during 2022' is treated as
                a reference to furnished during such first sufficient information year,
                the reference to 'in 2019' is treated as a reference to such sufficient
                information year, and the increase described in such paragraph is not
                applied; and
                 (iv) For an item or service furnished in any year subsequent to the
                first sufficient information year for such item or service with respect
                to such plan or coverage, the plan or issuer must calculate the
                qualifying payment amount in accordance with paragraph (c)(1)(ii),
                (iv), or (vi) of this section, as applicable, except that in applying
                such paragraph to such item or service, the reference to `furnished
                during 2023 or a subsequent year' is treated as a reference to
                furnished during the year after such first sufficient information year
                or a subsequent year.
                 (4) New service codes. In the case of a plan or issuer that does
                not have sufficient information to calculate the median of the
                contracted rates described in paragraph (b) of this section and
                determine the qualifying payment amount under paragraphs (c)(1) through
                (3) of this section because the item or service furnished is billed
                under a new service code--
                 (i) For an item or service furnished during 2022 (or, in the case
                of a newly covered item or service, during the first coverage year for
                the item or service with respect to the plan or coverage), the plan or
                issuer must identify a reasonably related service code that existed in
                the immediately preceding year and--
                 (A) If the Centers for Medicare & Medicaid Services has established
                a Medicare payment rate for the item or service billed under the new
                service code, the plan or issuer must calculate the qualifying payment
                amount by first calculating the ratio of the rate that Medicare pays
                for the item or service billed under the new service code compared to
                the rate that Medicare pays for the item or service billed under the
                related service code, and then multiplying the ratio by the qualifying
                payment amount for an item or service billed under the related service
                code for the year in which the item or service is furnished.
                 (B) If the Centers for Medicare & Medicaid Services has not
                established a Medicare payment rate for the item or service billed
                under the new service code, the plan or issuer must calculate the
                qualifying payment amount by first calculating the ratio of the rate
                that the plan or issuer reimburses for the item or service billed under
                the new service code compared to the rate that the plan or issuer
                reimburses for the item or service billed under the related service
                code, and then multiplying the ratio by the qualifying payment amount
                for an item or service billed under the related service code.
                 (ii) For an item or service furnished in a subsequent year (before
                the first sufficient information year for such item or service with
                respect to such plan or coverage or before the first year for which an
                eligible database has sufficient information to a calculate a rate
                under paragraph (c)(3)(i) of this section in the immediately preceding
                year), the plan or issuer must calculate the qualifying payment amount
                by increasing the qualifying payment amount determined under paragraph
                (c)(4)(i) of this section or this paragraph (c)(4)(ii), as applicable,
                for such item or service for the year immediately preceding such
                subsequent year, by the percentage increase in CPI-U over such
                preceding year;
                 (iii) For an item or service furnished in the first sufficient
                information year for such item or service with respect to such plan or
                coverage or the first year for which an eligible database has
                sufficient information to calculate a rate under paragraph (c)(3)(i) of
                this section in the immediately preceding year, the plan or issuer must
                calculate the qualifying payment amount in accordance with paragraph
                (c)(3) of this section.
                 (d) Information to be shared about qualifying payment amount. In
                cases in which the recognized amount with respect to an item or service
                furnished by a nonparticipating provider, nonparticipating emergency
                facility, or nonparticipating provider of air ambulance services is the
                qualifying payment amount, the plan or issuer must provide in writing,
                in paper or electronic form, to the provider or facility, as
                applicable--
                 (1) With each initial payment or notice of denial of payment under
                Sec. 149.110, Sec. 149.120, or Sec. 149.130:
                 (i) The qualifying payment amount for each item or service
                involved;
                 (ii) A statement to certify that, based on the determination of the
                plan or issuer--
                 (A) The qualifying payment amount applies for purposes of the
                recognized amount (or, in the case of air ambulance services, for
                calculating the participant's, beneficiary's, or enrollee's cost
                sharing); and
                 (B) Each qualifying payment amount shared with the provider or
                facility was determined in compliance with this section;
                 (iii) A statement that if the provider or facility, as applicable,
                wishes to
                [[Page 36979]]
                initiate a 30-day open negotiation period for purposes of determining
                the amount of total payment, the provider or facility may contact the
                appropriate person or office to initiate open negotiation, and that if
                the 30-day negotiation period does not result in a determination,
                generally, the provider or facility may initiate the independent
                dispute resolution process within 4 days after the end of the open
                negotiation period; and
                 (iv) 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 such item or service.
                 (2) In a timely manner upon request of the provider or facility:
                 (i) Information about whether the qualifying payment amount for
                items and services involved included contracted rates that were not on
                a fee-for-service basis for those specific items and services and
                whether the qualifying payment amount for those items and services was
                determined using underlying fee schedule rates or a derived amount;
                 (ii) If a plan or issuer uses an eligible database under paragraph
                (c)(3) of this section to determine the qualifying payment amount,
                information to identify which database was used; and
                 (iii) If a related service code was used to determine the
                qualifying payment amount for an item or service billed under a new
                service code under paragraph (c)(4)(i) or (ii) of this section,
                information to identify the related service code; and
                 (iv) If applicable, a statement that the plan's or issuer's
                contracted rates include risk-sharing, bonus, penalty, or other
                incentive-based or retrospective payments or payment adjustments for
                the items and services involved (as applicable) that were excluded for
                purposes of calculating the qualifying payment amount.
                 (e) Certain access fees to databases. In the case of a plan or
                issuer that, pursuant to this section, uses an eligible database to
                determine the qualifying payment amount for an item or service, the
                plan or issuer is responsible for any costs associated with accessing
                such database.
                 (f) Audits. The procedures described in part 150 of this subchapter
                apply with respect to ensuring that a plan or coverage is in compliance
                with the requirement of applying a qualifying payment amount under this
                subpart and ensuring that such amount so applied satisfies the
                requirements under this section, as applicable.
                 (g) Applicability date. The provisions of this section are
                applicable with respect to plan years (in the individual market, policy
                years) beginning on or after January 1, 2022.
                Sec. 149.150 Complaints process for surprise medical bills regarding
                group health plans and group and individual health insurance coverage.
                 (a) Scope and definitions--(1) Scope. This section establishes a
                process to receive and resolve complaints regarding information that a
                specific group health plan or health insurance issuer offering group or
                individual health insurance coverage may be failing to meet the
                requirements under this subpart, which may warrant an investigation.
                 (2) Definitions. In this section--
                 (i) Complaint means a communication, written or oral, that
                indicates there has been a potential violation of the requirements
                under subpart B of this part, whether or not a violation actually
                occurred.
                 (ii) Complainant means any individual, or their authorized
                representative, who files a complaint as defined in paragraph (a)(2)(i)
                of this section.
                 (b) Complaints process. (1) HHS will consider the date a complaint
                is filed to be the date upon which HHS receives an oral or written
                statement that identifies information about the complaint sufficient to
                identify the parties involved and the action or inaction complained of.
                 (2) HHS will notify complainants, by oral or written means, of
                receipt of the complaint no later than 60 business days after the
                complaint is received. HHS will include a response acknowledging
                receipt of the complaint, notifying the complainant of their rights and
                obligations under the complaints process, and describing the next steps
                of the complaints resolution process. As part of the response, HHS may
                request additional information needed to process the complaint. Such
                additional information may include:
                 (i) Explanations of benefits;
                 (ii) Processed claims;
                 (iii) Information about the health care provider, facility, or
                provider of air ambulance services involved;
                 (iv) Information about the group health plan or health insurance
                issuer covering the individual;
                 (v) Information to support a determination regarding whether the
                service was an emergency service or non-emergency service;
                 (vi) The summary plan description, policy, certificate, contract of
                insurance, membership booklet, outline of coverage, or other evidence
                of coverage the plan or issuer provides to participants, beneficiaries,
                or enrollees;
                 (vii) Documents regarding the facts in the complaint in the
                possession of, or otherwise attainable by, the complainant; or
                 (viii) Any other information HHS may need to make a determination
                of facts for an investigation.
                 (3) HHS will make reasonable efforts consistent with agency
                practices to notify the complainant of the outcome of the complaint
                after the submission is processed through appropriate methods as
                determined by HHS. A complaint is considered processed after HHS has
                reviewed the complaint and accompanying information and made an outcome
                determination. Based on the nature of the complaint and the plan or
                issuer involved, HHS may--
                 (i) Refer the complainant to another appropriate Federal or State
                resolution process;
                 (ii) Notify the complainant and make reasonable efforts to refer
                the complainant to the appropriate State or Federal regulatory
                authority if HHS receives a complaint where another entity has
                enforcement jurisdiction over the plan or issuer;
                 (iii) Refer the plan or issuer for an investigation for enforcement
                action under 45 CFR part 150; or
                 (iv) Provide the complainant with an explanation of the resolution
                of the complaint and any corrective action taken.
                Subpart C--[Reserved]
                Subpart D--Additional Patient Protections
                Sec. 149.310 Choice of health care professional.
                 (a) Choice of health care professional--(1) Designation of primary
                care provider--(i) In general. If a group health plan, or a health
                insurance issuer offering group or individual health insurance
                coverage, requires or provides for designation by a participant,
                beneficiary, or enrollee of a participating primary care provider, then
                the plan or issuer must permit each participant, beneficiary, or
                enrollee to designate any participating primary care provider who is
                available to accept the participant, beneficiary, or enrollee. In such
                a case, the plan or issuer must comply with the rules of paragraph
                (a)(4) of this section by informing each participant (in the individual
                market, primary subscriber) of the terms of the plan or health
                insurance coverage regarding designation of a primary care provider.
                [[Page 36980]]
                 (ii) Construction. Nothing in paragraph (a)(1)(i) of this section
                is to be construed to prohibit the application of reasonable and
                appropriate geographic limitations with respect to the selection of
                primary care providers, in accordance with the terms of the plan or
                coverage, the underlying provider contracts, and applicable State law.
                 (iii) Example. The rules of this paragraph (a)(1) are illustrated
                by the following example:
                 (A) Facts. A group health plan requires individuals covered under
                the plan to designate a primary care provider. The plan permits each
                individual to designate any primary care provider participating in the
                plan's network who is available to accept the individual as the
                individual's primary care provider. If an individual has not designated
                a primary care provider, the plan designates one until the individual
                has made a designation. The plan provides a notice that satisfies the
                requirements of paragraph (a)(4) of this section regarding the ability
                to designate a primary care provider.
                 (B) Conclusion. In this Example, the plan has satisfied the
                requirements of paragraph (a) of this section.
                 (2) Designation of pediatrician as primary care provider--(i) In
                general. If a group health plan, or a health insurance issuer offering
                group or individual health insurance coverage, requires or provides for
                the designation of a participating primary care provider for a child by
                a participant, beneficiary, or enrollee, the plan or issuer must permit
                the participant, beneficiary, or enrollee to designate a physician
                (allopathic or osteopathic) who specializes in pediatrics (including
                pediatric subspecialties, based on the scope of that provider's license
                under applicable State law) as the child's primary care provider if the
                provider participates in the network of the plan or issuer and is
                available to accept the child. In such a case, the plan or issuer must
                comply with the rules of paragraph (a)(4) of this section by informing
                each participant (in the individual market, primary subscriber) of the
                terms of the plan or health insurance coverage regarding designation of
                a pediatrician as the child's primary care provider.
                 (ii) Construction. Nothing in paragraph (a)(2)(i) of this section
                is to be construed to waive any exclusions of coverage under the terms
                and conditions of the plan or health insurance coverage with respect to
                coverage of pediatric care.
                 (iii) Examples. The rules of this paragraph (a)(2) are illustrated
                by the following examples:
                 (A) Example 1--(1) Facts. A group health plan's HMO designates for
                each participant a physician who specializes in internal medicine to
                serve as the primary care provider for the participant and any
                beneficiaries. Participant A requests that Pediatrician B be designated
                as the primary care provider for A's child. B is a participating
                provider in the HMO's network and is available to accept the child.
                 (2) Conclusion. In this Example 1, the HMO must permit A's
                designation of B as the primary care provider for A's child in order to
                comply with the requirements of this paragraph (a)(2).
                 (B) Example 2--(1) Facts. Same facts as Example 1 (paragraph
                (a)(2)(iii)(A) of this section), except that A takes A's child to B for
                treatment of the child's severe shellfish allergies. B wishes to refer
                A's child to an allergist for treatment. The HMO, however, does not
                provide coverage for treatment of food allergies, nor does it have an
                allergist participating in its network, and it therefore refuses to
                authorize the referral.
                 (2) Conclusion. In this Example 2, the HMO has not violated the
                requirements of this paragraph (a)(2) because the exclusion of
                treatment for food allergies is in accordance with the terms of A's
                coverage.
                 (3) Patient access to obstetrical and gynecological care--(i)
                General rights--(A) Direct access. A group health plan, or a health
                insurance issuer offering group or individual health insurance
                coverage, described in paragraph (a)(3)(ii) of this section, may not
                require authorization or referral by the plan, issuer, or any person
                (including a primary care provider) in the case of a female
                participant, beneficiary, or enrollee who seeks coverage for
                obstetrical or gynecological care provided by a participating health
                care professional who specializes in obstetrics or gynecology. In such
                a case, the plan or issuer must comply with the rules of paragraph
                (a)(4) of this section by informing each participant (in the individual
                market, primary subscriber) that the plan may not require authorization
                or referral for obstetrical or gynecological care by a participating
                health care professional who specializes in obstetrics or gynecology.
                The plan or issuer may require such a professional to agree to
                otherwise adhere to the plan's or issuer's policies and procedures,
                including procedures regarding referrals and obtaining prior
                authorization and providing services pursuant to a treatment plan (if
                any) approved by the plan or issuer. For purposes of this paragraph
                (a)(3), a health care professional who specializes in obstetrics or
                gynecology is any individual (including a person other than a
                physician) who is authorized under applicable State law to provide
                obstetrical or gynecological care.
                 (B) Obstetrical and gynecological care. A group health plan or
                health insurance issuer described in paragraph (a)(3)(ii) of this
                section must treat the provision of obstetrical and gynecological care,
                and the ordering of related obstetrical and gynecological items and
                services, pursuant to the direct access described under paragraph
                (a)(3)(i)(A) of this section, by a participating health care
                professional who specializes in obstetrics or gynecology as the
                authorization of the primary care provider.
                 (ii) Application of paragraph. A group health plan, or a health
                insurance issuer offering group or individual health insurance
                coverage, is described in this paragraph (a)(3) if the plan or issuer--
                 (A) Provides coverage for obstetrical or gynecological care; and
                 (B) Requires the designation by a participant, beneficiary, or
                enrollee of a participating primary care provider.
                 (iii) Construction. Nothing in paragraph (a)(3)(i) of this section
                is to be construed to--
                 (A) Waive any exclusions of coverage under the terms and conditions
                of the plan or health insurance coverage with respect to coverage of
                obstetrical or gynecological care; or
                 (B) Preclude the group health plan or health insurance issuer
                involved from requiring that the obstetrical or gynecological provider
                notify the primary care health care professional or the plan or issuer
                of treatment decisions.
                 (iv) Examples. The rules of this paragraph (a)(3) are illustrated
                by the following examples:
                 (A) Example 1--(1) Facts. A group health plan requires each
                participant to designate a physician to serve as the primary care
                provider for the participant and the participant's family. Participant
                A, a female, requests a gynecological exam with Physician B, an in-
                network physician specializing in gynecological care. The group health
                plan requires prior authorization from A's designated primary care
                provider for the gynecological exam.
                 (2) Conclusion. In this Example 1, the group health plan has
                violated the requirements of this paragraph (a)(3) because the plan
                requires prior authorization from A's primary care provider prior to
                obtaning gynecological services.
                 (B) Example 2--(1) Facts. Same facts as Example 1 (paragraph
                (a)(3)(iv)(A) of this section) except that A seeks
                [[Page 36981]]
                gynecological services from C, an out-of-network provider.
                 (2) Conclusion. In this Example 2, the group health plan has not
                violated the requirements of this paragraph (a)(3) by requiring prior
                authorization because C is not a participating health care provider.
                 (C) Example 3--(1) Facts. Same facts as Example 1 (paragraph
                (a)(3)(iv)(A) of this section) except that the group health plan only
                requires B to inform A's designated primary care physician of treatment
                decisions.
                 (2) Conclusion. In this Example 3, the group health plan has not
                violated the requirements of this paragraph (a)(3) because A has direct
                access to B without prior authorization. The fact that the group health
                plan requires the designated primary care physician to be notified of
                treatment decisions does not violate this paragraph (a)(3).
                 (D) Example 4--(1) Facts. A group health plan requires each
                participant to designate a physician to serve as the primary care
                provider for the participant and the participant's family. The group
                health plan requires prior authorization before providing benefits for
                uterine fibroid embolization.
                 (2) Conclusion. In this Example 4, the plan requirement for prior
                authorization before providing benefits for uterine fibroid
                embolization does not violate the requirements of this paragraph (a)(3)
                because, though the prior authorization requirement applies to
                obstetrical services, it does not restrict access to any providers
                specializing in obstetrics or gynecology.
                 (4) Notice of right to designate a primary care provider--(i) In
                general. If a group health plan or health insurance issuer requires the
                designation by a participant, beneficiary, or enrollee of a primary
                care provider, the plan or issuer must provide a notice informing each
                participant (in the individual market, primary subscriber) of the terms
                of the plan or health insurance coverage regarding designation of a
                primary care provider and of the rights--
                 (A) Under paragraph (a)(1)(i) of this section, that any
                participating primary care provider who is available to accept the
                participant, beneficiary, or enrollee can be designated;
                 (B) Under paragraph (a)(2)(i) of this section, with respect to a
                child, that any participating physician who specializes in pediatrics
                can be designated as the primary care provider; and
                 (C) Under paragraph (a)(3)(i) of this section, that the plan may
                not require authorization or referral for obstetrical or gynecological
                care by a participating health care professional who specializes in
                obstetrics or gynecology.
                 (ii) Timing. In the case of a group health plan or group health
                insurance coverage, the notice described in paragraph (a)(4)(i) of this
                section must be included whenever the plan or issuer provides a
                participant with a summary plan description or other similar
                description of benefits under the plan or health insurance coverage. In
                the case of individual health insurance coverage, the notice described
                in paragraph (a)(4)(i) of this section must be included whenever the
                issuer provides a primary subscriber with a policy, certificate, or
                contract of health insurance.
                 (iii) Model language. The following model language can be used to
                satisfy the notice requirement described in paragraph (a)(4)(i) of this
                section:
                 (A) For plans and issuers that require or allow for the designation
                of primary care providers by participants, beneficiaries, or enrollees,
                insert:
                 [Name of group health plan or health insurance issuer] generally
                [requires/allows] the designation of a primary care provider. You
                have the right to designate any primary care provider who
                participates in our network and who is available to accept you or
                your family members. [If the plan or health insurance coverage
                designates a primary care provider automatically, insert: Until you
                make this designation, [name of group health plan or health
                insurance issuer] designates one for you.] For information on how to
                select a primary care provider, and for a list of the participating
                primary care providers, contact the [plan administrator or issuer]
                at [insert contact information].
                 (B) For plans and issuers that require or allow for the designation
                of a primary care provider for a child, add:
                 For children, you may designate a pediatrician as the primary
                care provider.
                 (C) For plans and issuers that provide coverage for obstetric or
                gynecological care and require the designation by a participant,
                beneficiary, or enrollee of a primary care provider, add:
                 You do not need prior authorization from [name of group health
                plan or issuer] or from any other person (including a primary care
                provider) in order to obtain access to obstetrical or gynecological
                care from a health care professional in our network who specializes
                in obstetrics or gynecology. The health care professional, however,
                may be required to comply with certain procedures, including
                obtaining prior authorization for certain services, following a pre-
                approved treatment plan, or procedures for making referrals. For a
                list of participating health care professionals who specialize in
                obstetrics or gynecology, contact the [plan administrator or issuer]
                at [insert contact information].
                 (b) Applicability date. The provisions of this section are
                applicable with respect to plan years (in the individual market, policy
                years) beginning on or after January 1, 2022.
                Subpart E--Health Care Provider, Health Care Facility, and Air
                Ambulance Service Provider Requirements
                Sec. 149.410 Balance billing in cases of emergency services.
                 (a) In general. In the case of a participant, beneficiary, or
                enrollee with benefits under a group health plan or group or individual
                health insurance coverage offered by a health insurance issuer and who
                is furnished emergency services (for which benefits are provided under
                the plan or coverage) with respect to an emergency medical condition
                with respect to a visit at an emergency department of a hospital or an
                independent freestanding emergency department--
                 (1) A nonparticipating emergency facility must not bill, and must
                not hold liable, the participant, beneficiary, or enrollee for a
                payment amount for such emergency services (as defined in 26 CFR
                54.9816-4T(c)(2), 29 CFR 2590.716-4(c)(2), and Sec. 149.110(c)(2), as
                applicable) that exceeds the cost-sharing requirement for such services
                (as determined in accordance with 26 CFR 54.9816-4T(b)(3)(ii) and
                (iii), 29 CFR 2590.716-4(b)(3)(ii) and (iii), and Sec.
                149.110(b)(3)(ii) and (iii), as applicable).
                 (2) A nonparticipating provider must not bill, and must not hold
                liable, the participant, beneficiary, or enrollee for a payment amount
                for an emergency service (as defined in 26 CFR 54.9816-4T(c)(2), 29 CFR
                2590.716-4(c)(2), and Sec. 149.110(c)(2), as applicable) furnished to
                such individual by such provider with respect to such emergency medical
                condition and visit for which the individual receives emergency
                services at the hospital or independent freestanding emergency
                department that exceeds the cost-sharing requirement for such service
                (as determined in accordance with 26 CFR 54.9816-4T(b)(3)(ii) and
                (iii), 29 CFR 2590.716-4(b)(3)(ii) and (iii), and Sec.
                149.110(b)(3)(ii) and (iii), as applicable).
                 (b) Notice and consent to be treated by a nonparticipating provider
                or nonparticipating emergency facility. The requirements in paragraph
                (a) of this section do not apply with respect to items and services
                described in 26 CFR, 54.9816-4T(c)(2)(ii)(A), 29 CFR 2590.716-
                4(c)(2)(ii)(A), Sec. 149.110(c)(2)(ii)(A), as applicable, and are not
                included as emergency services if all of the following conditions are
                met:
                 (1) The attending emergency physician or treating provider
                determines that the participant,
                [[Page 36982]]
                beneficiary, or enrollee is able to travel using nonmedical
                transportation or nonemergency medical transportation to an available
                participating provider or facility located within a reasonable travel
                distance, taking into account the individual's medical condition. The
                attending emergency physician's or treating provider's determination is
                binding on the facility for purposes of this requirement.
                 (2) The provider or facility furnishing such additional items and
                services satisfies the notice and consent criteria of Sec. 149.420(c)
                through (g) with respect to such items and services, provided that the
                written notice additionally satisfies paragraphs (b)(2)(i) and (ii) of
                this section, as applicable. In applying this paragraph (b)(2), a
                reference in Sec. 149.420 to a nonparticipating provider is deemed to
                include a nonparticipating emergency facility.
                 (i) In the case of a participating emergency facility and a
                nonparticipating provider, the written notice must also include a list
                of any participating providers at the facility who are able to furnish
                such items and services involved and notification that the participant,
                beneficiary, or enrollee may be referred, at their option, to such a
                participating provider.
                 (ii) In the case of a nonparticipating emergency facility, the
                written notice must include the good faith estimated amount that the
                participant, beneficiary, or enrollee may be charged for items or
                services furnished by the nonparticipating emergency facility or by
                nonparticipating providers with respect to the visit at such facility
                (including any item or service that is reasonably expected to be
                furnished by the nonparticipating emergency facility or
                nonparticipating providers in conjunction with such items or services).
                 (3) The participant, beneficiary, or enrollee (or an authorized
                representative of such individual) is in a condition to receive the
                information described in Sec. 149.420, as determined by the attending
                emergency physician or treating provider using appropriate medical
                judgment, and to provide informed consent under such section, in
                accordance with applicable State law. For purposes of this section and
                Sec. 149.420, an authorized representative is an individual authorized
                under State law to provide consent on behalf of the participant,
                beneficiary, or enrollee, provided that the individual is not a
                provider affiliated with the facility or an employee of the facility,
                unless such provider or employee is a family member of the participant,
                beneficiary, or enrollee.
                 (4) The provider or facility satisfies any additional requirements
                or prohibitions as may be imposed under State law.
                 (c) Inapplicability of notice and consent exception to certain
                items and services. A nonparticipating provider or nonparticipating
                facility specified in paragraph (a) of this section will always be
                subject to the prohibitions in paragraph (a) of this section, with
                respect to items or services furnished as a result of unforeseen,
                urgent medical needs that arise at the time an item or service is
                furnished, regardless of whether the nonparticipating provider or
                nonparticipating emergency facility satisfied the notice and consent
                criteria in Sec. 149.420(c) through (g).
                 (d) Retention of certain documents. A nonparticipating emergency
                facility (with respect to such facility or any nonparticipating
                provider at such facility) that obtains from a participant,
                beneficiary, or enrollee of a group health plan or group or individual
                health insurance coverage (or an authorized representative of such an
                individual) a written consent in accordance with Sec. 149.420(e), with
                respect to furnishing an item or service to such an individual, must
                retain the written notice and consent for at least a 7-year period
                after the date on which the item or service is so furnished. If a
                nonparticipating provider obtains a signed consent from a participant,
                beneficiary, or enrollee, or such individual's authorized
                representative, the provider may either coordinate with the facility to
                retain the written notice and consent for a 7-year period, or the
                provider must retain the written notice and consent for a 7-year
                period.
                 (e) Notification to plan or issuer. In the case of a participant,
                beneficiary, or enrollee who is stabilized and furnished additional
                items and services described in Sec. 149.110(c)(2)(ii), a
                nonparticipating provider or nonparticipating emergency facility must
                notify the plan or issuer, respectively, when transmitting the bill for
                such items and services, either on the bill or in a separate document,
                as to whether all of the conditions described in paragraph (b) of this
                section are met with respect to each of the items and services for
                which the bill is submitted, and if applicable, provide to the plan or
                issuer a copy of the signed written notice and consent document
                described in paragraph (b)(2) of this section.
                 (f) Applicability date. The provisions of this section are
                applicable with respect to emergency services furnished during a plan
                year (in the individual market, policy year) beginning on or after
                January 1, 2022.
                Sec. 149.420 Balance billing in cases of non-emergency services
                performed by nonparticipating providers at certain participating health
                care facilities.
                 (a) In general. A nonparticipating provider of a group health plan
                or group or individual health insurance coverage who provides items or
                services (other than emergency services) for which benefits are
                provided under the plan or coverage at a participating health care
                facility must not bill, and must not hold liable, a participant,
                beneficiary, or enrollee of such plan or coverage for a payment amount
                for such an item or service furnished by such provider with respect to
                a visit at the facility that exceeds the cost-sharing requirement for
                such item or service (as determined in accordance with 26 CFR 54.9816-
                5T(c)(1) and (2), 29 CFR 2590.717-1(c)(1) and (2), and Sec.
                149.120(c)(1) and (2), as applicable), unless the provider (or the
                participating health care facility on behalf of the provider) satisfies
                the notice and consent criteria of paragraph (c) of this section.
                 (b) Inapplicability of notice and consent exception to certain
                items and services. The notice and consent criteria in paragraphs (c)
                through (i) of this section do not apply, and a nonparticipating
                provider specified in paragraph (a) of this section will always be
                subject to the prohibitions in paragraph (a) of this section, with
                respect to the following services:
                 (1) Ancillary services, meaning--
                 (i) Items and services related to emergency medicine,
                anesthesiology, pathology, radiology, and neonatology, whether provided
                by a physician or non-physician practitioner;
                 (ii) Items and services provided by assistant surgeons,
                hospitalists, and intensivists;
                 (iii) Diagnostic services, including radiology and laboratory
                services; and
                 (iv) Items and services provided by a nonparticipating provider if
                there is no participating provider who can furnish such item or service
                at such facility.
                 (2) Items or services furnished as a result of unforeseen, urgent
                medical needs that arise at the time an item or service is furnished,
                regardless of whether the nonparticipating provider satisfied the
                notice and consent criteria in paragraph (c) of this section.
                 (c) Notice and consent to be treated by a nonparticipating
                provider. Subject to paragraph (f) of this section, and unless
                prohibited by State law, a nonparticipating provider satisfies the
                notice and consent criteria of this paragraph (c) with respect to items
                or services furnished by the provider to a participant, beneficiary, or
                enrollee of a group health plan or group or individual
                [[Page 36983]]
                health insurance coverage, if the provider (or a participating health
                care facility on behalf on a nonparticipating provider)--
                 (1) Provides to the participant, beneficiary, or enrollee a written
                notice in paper or, as practicable, electronic form, as selected by the
                individual, that contains the information required under paragraph (d)
                of this section, provided such written notice is provided:
                 (i) In accordance with guidance issued by HHS, and in the form and
                manner specified in such guidance;
                 (ii) With the consent document, and is provided physically separate
                from other documents and not attached to or incorporated into any other
                document; and
                 (iii) To such participant, beneficiary, or enrollee--
                 (A) Not later than 72 hours prior to the date on which the
                individual is furnished such items or services, in the case where the
                appointment to be furnished such items or services is scheduled at
                least 72 hours prior to the date on which the individual is to be
                furnished such items and services; or
                 (B) On the date the appointment to be furnished such items or
                services is scheduled, in the case where the appointment is scheduled
                within 72 hours prior to the date on which such items or services are
                to be furnished. Where an individual is provided the notice on the same
                date that the items or services are to be furnished, providers and
                facilities are required to provide the notice no later than 3 hours
                prior to furnishing items or services to which the notice and consent
                requirements apply.
                 (2) Obtains from the participant, beneficiary, or enrollee the
                consent described in paragraph (e) of this section to be treated by the
                nonparticipating provider. An authorized representative may receive the
                notice on behalf of a participant, beneficiary, or enrollee, and may
                provide consent on behalf of the participant, beneficiary, or enrollee.
                For purposes of this section and Sec. 149.410, an authorized
                representative is an individual authorized under State law to provide
                consent on behalf of the participant, beneficiary, or enrollee,
                provided that the individual is not a provider affiliated with the
                facility or an employee of the facility, unless such provider or
                employee is a family member of the participant, beneficiary, or
                enrollee. The consent must--
                 (i) Be provided voluntarily, meaning the individual is able to
                consent freely, without undue influence, fraud, or duress;
                 (ii) Be obtained in accordance with, and in the form and manner
                specified in, guidance issued by HHS; and
                 (iii) Not be revoked, in writing, by the participant, beneficiary,
                or enrollee prior to the receipt of items and services to which the
                consent applies.
                 (3) Provides a copy of the signed written notice and consent to the
                participant, beneficiary, or enrollee in-person or through mail or
                email, as selected by the participant, beneficiary, or enrollee.
                 (d) Information required under written notice. The written notice
                described in paragraph (c)(1) of this section must be provided in the
                form and manner specified by HHS in guidance, and must--
                 (1) State that the health care provider is a nonparticipating
                provider, with respect to the health plan or coverage.
                 (2) Include the good faith estimated amount that such
                nonparticipating provider may charge the participant, beneficiary, or
                enrollee for the items and services involved (including any item or
                service that is reasonably expected to be furnished by the
                nonparticipating provider in conjunction with such items or services),
                including notification that the provision of the estimate or consent to
                be treated under paragraph (e) of this section does not constitute a
                contract with respect to the charges estimated for such items and
                services or a contract that binds the participant, beneficiary, or
                enrollee to be treated by that provider or facility.
                 (3) Provide a statement that prior authorization or other care
                management limitations may be required in advance of receiving such
                items or services at the facility.
                 (4) Clearly state that consent to receive such items and services
                from such nonparticipating provider is optional and that the
                participant, beneficiary, or enrollee may instead seek care from an
                available participating provider, with respect to the plan or coverage,
                as applicable, and that in such cases the cost-sharing responsibility
                of the participant, beneficiary, or enrollee would not exceed the
                responsibility that would apply with respect to such an item or service
                that is furnished by a participating provider, as applicable, with
                respect to such plan.
                 (e) Consent described to be treated by a nonparticipating provider.
                The consent described in this paragraph (e), with respect to a
                participant, beneficiary, or enrollee of a group health plan or group
                or individual health insurance coverage who is to be furnished items or
                services by a nonparticipating provider, must be documented on a form
                specified by the Secretary, in consultation with the Secretary of
                Labor, through guidance and provided in accordance with such guidance,
                that must be signed by the participant, beneficiary, or enrollee before
                such items and services are furnished and that--
                 (1) Acknowledges in clear and understandable language that the
                participant, beneficiary, or enrollee has been--
                 (i) Provided with the written notice under paragraph (c) of this
                section, in the form selected by the participant, beneficiary, or
                enrollee.
                 (ii) Informed that the payment of such charge by the participant,
                beneficiary, or enrollee might not accrue toward meeting any limitation
                that the plan or coverage places on cost sharing, including an
                explanation that such payment might not apply to an in-network
                deductible or out-of-pocket maximum applied under the plan or coverage.
                 (2) States that by signing the consent, the individual agrees to be
                treated by the nonparticipating provider and understands the individual
                may be balance billed and subject to cost-sharing requirements that
                apply to services furnished by the nonparticipating provider.
                 (3) Documents the time and date on which the participant,
                beneficiary, or enrollee received the written notice described in
                paragraph (c) of this section and the time and date on which the
                individual signed the consent to be furnished such items or services by
                such nonparticipating provider.
                 (f) Language access. (1) A nonparticipating provider (or the
                participating health care facility on behalf of the nonparticipating
                provider) must provide the individual with the choice to receive the
                written notice and consent document in any of the 15 most common
                languages in the State in which the applicable facility is located,
                except that the notice and consent document may instead be available in
                any of the 15 most common languages in a geographic region that
                reasonably reflects the geographic region served by the applicable
                facility; and
                 (2) If the individual's preferred language is not among the 15 most
                common languages in which the nonparticipating provider (or the
                participating health care facility on behalf of the nonparticipating
                provider) makes the notice and consent document available and the
                individual cannot understand the language in which the notice and
                consent document are provided, the notice and consent criteria in
                paragraph (c) of this section are not met unless the nonparticipating
                [[Page 36984]]
                provider (or the participating health care facility on behalf of the
                nonparticipating provider) has obtained the services of a qualified
                interpreter to assist the individual with understanding the information
                contained in the notice and consent document.
                 (g) Scope of consent. The consent described in paragraph (e) of
                this section will constitute consent only to the receipt of the
                information provided pursuant to this section and will not constitute a
                contractual agreement of the participant, beneficiary, or enrollee to
                any estimated charge or amount included in such information, or to be
                treated by that provider or facility.
                 (h) Retention of certain documents. A participating health care
                facility (with respect to nonparticipating providers at such facility)
                that obtains from a participant, beneficiary, or enrollee of a group
                health plan or group or individual health insurance coverage a written
                consent in accordance with paragraph (e) of this section, with respect
                to furnishing an item or service to such an individual, must retain the
                written notice and consent for at least a 7-year period after the date
                on which the item or service is so furnished. If a nonparticipating
                provider obtains a signed consent from a participant, beneficiary, or
                enrollee, where the facility does not otherwise obtain the consent on
                behalf of the provider, the provider may either coordinate with the
                facility to retain the written notice and consent for a 7-year period,
                or the provider must retain the written notice and consent for a 7-year
                period.
                 (i) Notification to plan or issuer. For each item or service
                furnished by a nonparticipating provider described in paragraph (a) of
                this section, the provider (or the participating facility on behalf of
                the nonparticipating provider) must timely notify the plan or issuer
                that the item or service was furnished during a visit at a
                participating health care facility, and, if applicable, provide to the
                plan or issuer a copy of the signed written notice and consent document
                described in paragraphs (c) and (e) of this section. In instances
                where, to the extent permitted by this section, the nonparticipating
                provider bills the participant, beneficiary, or enrollee directly, the
                provider may satisfy the requirement to notify the plan or issuer by
                including the notice with the bill to the participant, beneficiary, or
                enrollee.
                 (j) Applicability date. The provisions of this section are
                applicable with respect to items and services furnished during a plan
                year (in the individual market, policy year) beginning on or after
                January 1, 2022.
                Sec. 149.430 Provider and facility disclosure requirements regarding
                patient protections against balance billing.
                 (a) In general. Each health care provider and health care facility
                (including an emergency department of a hospital and an independent
                freestanding emergency department) must make publicly available, post
                on a public website of such provider or facility (if applicable), and
                provide to any individual who is a participant, beneficiary, or
                enrollee of a group health plan or group or individual health insurance
                coverage offered by a health insurance issuer and to whom the provider
                or facility furnishes items or services, the information described in
                paragraph (b) of this section regarding patient protections against
                balance billing, except as provided in paragraphs (e) and (f) of this
                section. A provider or facility must make the disclosures in accordance
                with the method and timing requirements set forth in paragraphs (c) and
                (d) of this section.
                 (b) Content. The disclosures required under this section must
                include, in clear and understandable language, all the information
                described in this paragraph (b) (and may include any additional
                information that does not conflict with that information).
                 (1) A statement that explains the requirements of and prohibitions
                applicable to the health care provider or health care facility under
                sections 2799B-1 and 2799B-2 of the PHS Act and their implementing
                regulations in Sec. Sec. 149.410 and 149.420;
                 (2) If applicable, a statement that explains any State law
                requirements regarding the amounts such provider or facility may, with
                respect to an item or service, charge a participant, beneficiary, or
                enrollee of a group health plan or group or individual health insurance
                coverage offered by a health insurance issuer with respect to which
                such provider or facility does not have a contractual relationship,
                after receiving payment, if any, from the plan or coverage,
                respectively, for such item or service and any applicable cost-sharing
                payment from such participant, beneficiary, or enrollee; and
                 (3) A statement providing contact information for the appropriate
                State and Federal agencies that an individual may contact if the
                individual believes the provider or facility has violated a requirement
                described in the notice.
                 (c) Required methods for disclosing information. Health care
                providers and health care facilities must provide the disclosure
                required under this section as follows:
                 (1) With respect to the required disclosure to be posted on a
                public website, the information described in paragraph (b) of this
                section, or a link to such information, must appear on a searchable
                homepage of the provider's or facility's website. A provider or
                facility that does not have its own website is not required to make a
                disclosure under this paragraph (c)(1).
                 (2) With respect to the required disclosure to the public, a
                provider or facility must make public the information described in
                paragraph (b) of this section on a sign posted prominently at the
                location of the provider or facility. A provider that does not have a
                publicly accessible location is not required to make a disclosure under
                this paragraph (c)(2).
                 (3) With respect to the required disclosure to individuals who are
                participants, beneficiaries, or enrollees of a group health plan or
                group or individual health insurance coverage offered by a health
                insurance issuer, a provider or facility must provide the information
                described in paragraph (b) of this section in a one-page (double-sided)
                notice, using print no smaller than 12-point font. The notice must be
                provided in-person or through mail or email, as selected by the
                participant, beneficiary, or enrollee.
                 (d) Timing of disclosure to individuals. A health care provider or
                health care facility is required to provide the notice to individuals
                who are participants, beneficiaries, or enrollees of a group health
                plan or group or individual health insurance coverage offered by a
                health insurance issuer no later than the date and time on which the
                provider or facility requests payment from the individual, or with
                respect to an individual from whom the provider or facility does not
                request payment, no later than the date on which the provider or
                facility submits a claim to the group health plan or health insurance
                issuer.
                 (e) Exceptions. A health care provider is not required to make the
                disclosures required under this section--
                 (1) If the provider does not furnish items or services at a health
                care facility, or in connection with visits at health care facilities;
                or
                 (2) To individuals to whom the provider furnishes items or
                services, if such items or services are not furnished at a health care
                facility, or in connection with a visit at a health care facility.
                 (f) Special rule to prevent unnecessary duplication with respect to
                health care providers. To the extent a provider furnishes an item or
                service covered under the plan or coverage at a health care facility
                (including an emergency
                [[Page 36985]]
                department of a hospital or independent freestanding emergency
                department), the provider satisfies the requirements of paragraphs
                (c)(2) and (3) of this section if the facility makes the information
                available, in the required form and manner, pursuant to a written
                agreement. Accordingly, if a provider and facility enter into a written
                agreement under which the facility agrees to make the information
                required under this section available on a sign posted prominently at
                the facility and to provide the one-page notice to individuals in
                compliance with this section, and the facility fails to do so, then the
                facility, but not the provider, violates the disclosure requirements of
                this section.
                 (g) Applicability date. The provisions of this section are
                applicable beginning on January 1, 2022.
                Sec. 149.440 Balance billing in cases of air ambulance services.
                 (a) In general. In the case of a participant, beneficiary, or
                enrollee with benefits under a group health plan or group or individual
                health insurance coverage offered by a health insurance issuer who is
                furnished air ambulance services (for which benefits are available
                under such plan or coverage) from a nonparticipating provider of air
                ambulance services, with respect to such plan or coverage, the provider
                must not bill, and must not hold liable, the participant, beneficiary,
                or enrollee for a payment amount for the air ambulance services
                furnished by the provider that is more than the cost-sharing amount for
                such service (as determined in accordance with 26 CFR 54.9817-1T(b)(1)
                and (2), 29 CFR 2590.717-1(b)(1) and (2), and Sec. 149.130(b)(1) and
                (2), as applicable).
                 (b) Applicability date. The provisions of this section are
                applicable with respect to air ambulance services furnished during a
                plan year (in the individual market, policy year) beginning on or after
                January 1, 2022.
                Sec. 149.450 Complaint process for balance billing regarding
                providers and facilities.
                 (a) Scope and definitions--(1) Scope. This section establishes a
                process for HHS to receive and resolve complaints regarding information
                that a health care provider, provider of air ambulance services, or
                health care facility may be failing to meet the requirements under
                subpart E of this part, which may warrant an investigation.
                 (2) Definitions. In this section--
                 (i) Complaint means a communication, written, or oral, that
                indicates there has been a potential violation of the requirements
                under this subpart, whether or not a violation actually occurred.
                 (ii) Complainant means any individual, or their authorized
                representative, who files a complaint as defined in paragraph (a)(2)(i)
                of this section.
                 (b) Complaints process. (1) HHS will consider the date a complaint
                is filed to be the date upon which HHS receives an oral, written, or
                electronic statement that identifies information about the complaint
                sufficient to identify the parties involved and the action or inaction
                complained of.
                 (2) HHS will notify complainants, by oral or written means, of
                receipt of the complaint no later than 60 business days after the
                complaint is received. HHS will include a response acknowledging
                receipt of the complaint, notifying the complainant of their rights and
                obligations under the complaints process, and describing the next steps
                of the complaints resolution process. HHS may request additional
                information that may be needed to process the complaint as part of the
                response. Such additional information may include:
                 (i) Health care provider, air ambulance provider, or health care
                facility bills;
                 (ii) Health care provider, air ambulance provider, or health care
                facility network status;
                 (iii) Information regarding the participant's, beneficiary's, or
                enrollee's health care plan or health insurance coverage;
                 (iv) Information to support a determination regarding whether the
                service was an emergency service or non-emergency service;
                 (v) Documents regarding the facts in the complaint in the
                possession of, or otherwise attainable by, the complainant; or
                 (vi) Any other information HHS needs to make a determination of
                facts for an investigation.
                 (3) HHS will make reasonable efforts consistent with agency
                practices to notify the complainant of the outcome of the complaint
                after the submission is processed through appropriate methods as
                determined by HHS. A complaint is considered processed after HHS has
                reviewed the complaint and accompanying information and made an outcome
                determination. Based on the nature of the complaint, HHS may--
                 (i) Refer the complainant to another appropriate Federal or State
                resolution process;
                 (ii) Notify the complainant and make reasonable efforts to refer
                the complainant to the appropriate State or Federal regulatory
                authority if HHS receives a complaint where another entity has
                enforcement jurisdiction over the health care provider, air ambulance
                provider or health care facility;
                 (iii) Refer the health care provider, air ambulance provider or
                health care facility for an investigation for enforcement action under
                45 CFR part 150; or
                 (iv) Provide the complainant with an explanation of resolution and
                any corrective action taken.
                PART 156--HEALTH INSURANCE ISSUER STANDARDS UNDER THE AFFORDABLE
                CARE ACT, INCLUDING STANDARDS RELATED TO EXCHANGES
                0
                19. The authority citation for part 156 continues to read as follows:
                 Authority: 42 U.S.C. 18021-18024, 18031-18032, 18041-18042,
                18044, 18054, 18061, 18063, 18071, 18082, and 26 U.S.C. 36B.
                0
                20. Section 156.155 is amended by:
                0
                a. Revising paragraph (a)(3);
                0
                b. Redesignating paragraph (c) as paragraph (d); and
                0
                c. Adding a new paragraph (c).
                 The revision and addition read as follows:
                Sec. 156.155 Enrollment in catastrophic plans.
                 (a) * * *
                 (3) Provides coverage of the essential health benefits under
                section 1302(b) of the Affordable Care Act, except that the plan
                provides no benefits for any plan year (except as provided in
                paragraphs (a)(4), (b), and (c) of this section) until the annual
                limitation on cost sharing in section 1302(c)(1) of the Affordable Care
                Act is reached.
                * * * * *
                 (c) Coverage to prevent surprise medical bills. A catastrophic plan
                must provide benefits as required under sections 2799A-1 and 2799A-2 of
                the Public Health Service Act and their implementing regulations in
                Sec. Sec. 149.110, 149.120, and 149.130 or any applicable State law
                providing similar protections to individuals, and will not violate
                paragraph (a)(3) of this section solely because of the provision of
                such benefits before the annual limitation on cost sharing is reached.
                * * * * *
                [FR Doc. 2021-14379 Filed 7-6-21; 4:15 pm]
                BILLING CODE 6523-63-P; 4830-01-P; 4510-29-P; 4120-01-P
                

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