The No Surprises Act went into effect on January 1, 2022, and we are seeing an increase already in payment disputes. After six days of court proceedings, on May 16, 2022, a jury unanimously reversed the judgment for Colorado patient, Lisa French, to lift the liability of her surprise medical bill of $229,112.13. Nearly a decade ago, Lisa received back surgery at St. Anthony North Hospital in Westminster, Colorado. At the time, this was an out-of-network Centura Health hospital but was inappropriately identified as an in-network facility for Ms. French.
Ms. French was not informed that the network facility had an out-of-network status for her health plan. Following her surgery, she was billed the full chargemaster rates – the healthcare-related items and services for received care. The final court ruling was in the patient’s favor and Centura Health is now absorbing $229,000 in costs.
Let’s break down some risks to hospitals and health systems with scenarios like this one, and provide ways to better manage provider data with reliability and peace of mind.
What are the risks to hospitals and health systems that may use inaccurate provider data?
The Affordable Care Act (ACA) was set in place a decade ago to encourage providers and insurance companies to keep their provider data information up to date. Since the ACA is enforced at the state level, the type of compliance and regulation varied. The risk of being out of compliance with accurate and transparent provider data wasn’t as high and wasn’t routinely monitored.
The landscape has changed since the implementation of the ACA. With the No Surprises Act in place since January 1, 2022, federal law now has specific regulations for transparent and comprehensive provider data. These regulations are more routinely enforced, which brings risks of fines and increased time devoted to being in compliance. In fact, CMS will soon fine insurers for having inaccurate data in their system. Inaccuracies include but are not limited to:
- Provider location information
- Provider contact information
- Provider directories accepting or not accepting new patients
- Out-of-network or in-network practices (also impacting chargemaster rates or added fees)
Therefore, accurate and transparent data is more critical than ever before. CMS previously found that 52.2% of online provider directory data contain inaccuracies. It is a safe assumption that across the U.S. many organizations are still out of compliance today. This is a costly risk that impacts payers, providers, and health systems collectively. By the end of 2022, insurers are predicted to be responsible for an additional $20 billion in yearly claims.
Were Centura Health hospital’s chargemaster rates reliable or accurate?
A Centura Health representative testified that St. Anthony North Hospital did not provide chargemaster rates to patients like Ms. French. The reason? Because the data was considered a trade secret. Because of the proprietary nature, this data was not routinely shared with any patient. In any case, accuracy and reliability of any listed and unlisted rates were scrutinized during the court hearing. Justice Richard L. Gabriel, when giving the ruling, stated, “Moreover, as courts and commentators have observed, hospital chargemasters have become increasingly arbitrary, and over time, have lost any direct connection to hospital’s actual costs, reflecting, instead, inflated rates set to produce a targeted amount of profit for the hospitals after factoring in discounts negotiated with private and governmental insurers.”
Given the court’s ruling and cases like this one, there is increasing spotlight on the need for accurate data. The growing expectation is for healthcare organizations to be in full compliance with the No Surprises Act. But the overall process of managing data by humans isn’t an easy undertaking. Achieving trustworthy provider data in a manual process is difficult.Healthcare organizations will need to shift the status quo of line-by-line manual reviews and sourcing updates from outdated data sources. If we continue to maintain the status quo, we will see more costly outcomes for health systems as seen in the French case.
How do health systems and hospitals comply with the No Surprises Act?
Short answer: It’s a challenge for health systems and hospitals today. Many health systems and hospitals see the No Surprises act as a daunting process due to the need to provide a “good faith estimate” to patients. The available cost estimates must be disclosed to patients who request it, which means the data must be accurate and up to date to prevent legal or compliance risks. Data must pull from provider directories and other sources of data that aren’t routinely managed by one single entity. According to compliance experts, this is catching many medical practices off guard due to the complex obligation of accurate data in a short amount of time.
How can health systems and hospitals ensure reliable or accurate data moving forward?
With artificial intelligence and technology like supervised machine learning, accurate and up-to-date provider data is becoming the new status quo. Automation is possible through smart algorithms and will lift the burden of the time it takes to compile, review, and clean provider data. Data management is achieved faster and better. Provider data automation platforms like Orderly Health are working with payers, providers, and health systems to automate and course correct their provider data. As a result, provider data information becomes centralized and kept accurate and clean in near real-time. By crowdsourcing data from multiple organizations and data points, reliable data directories and accurate provider data are made possible.
Let’s continue the discussion. Orderly Health‘s co-founder and CEO, Kevin Krauth, recently appeared on the Rise of the Next podcast to talk about how Orderly Health is solving one of healthcare’s most complex and consequential problems: provider data. Full episode here.