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Did a recent ruling in the Lone Star State embolden BCBSNC’s abuse of the No Surprises Act?

According to a February article by the American Hospital Association, a federal judge in Texas may be subtly agreeing that payors are as shady as we think.

What’s that old phrase? “The road to hell is paved with good intentions”? As it turns out, the No Surprises Act is living proof that, no matter how much the federal government tries to make healthcare more accessible, good intentions give way to troubling circumstances—especially when payors are involved. Case in point: some shady situations in both North Carolina and Texas.

But first, a refresher:

Surprise billing is a highly controversial issue, one the No Surprises Act attempted to alleviate for everyone when it was first signed back in 2020. The rule was initially implemented to protect patients from being balance billed when they went out of network for care.

In summary, the biggest problem with the legislation came in 2021 when the Biden administration — via the Department of Health and Human Services, the Department of Labor, the Treasury, and the Office of Personnel Management — issued a new rule affecting the independent arbitration process outlined in the initial Act. This new arbitration process would revolve around the average in-network rate­, incentivizing insurers to push out of their network any providers that are higher paid, even if their higher rates are in line with their skill, experience or capability.

Though intended to provide additional guidance and a baseline to arbitrators, almost immediately, providers found this dispute resolution process gave insurers overwhelming power in their negotiations and exacerbated the race to the bottom – providers struggling to give quality care at already unsustainable rates suddenly had a bill that justified horrendous behavior by payors. We saw that one coming, didn’t we?

And thus, more voices have started singing their songs. Per an article in Healthcare Finance,  a group of North Carolina anesthesiologists accused Blue Cross and Blue Shield of North Carolina (BCBSNC) of abusing the No Surprises Act,  “threatening contract termination unless the physicians agree to payment reductions ranging from 10% to more than 30%, the American Society of Anesthesiologists said.”

With more than 57% of the market share in North Carolina, BCBSNC’s wide-sweeping action would dramatically impact more than 50 providers across the state.

The Texas Medical Association felt similarly about the new rule – so it sued the federal government, and in February, a federal judge in the Lone Star State ruled in its favor, striking down the heavily scrutinized arbitration process.

And while the Texas case isn’t explicitly addressing the shady stuff that’s happening with BCBSNC, we seem to get the hint. U.S. District Judge Jeremy Kernodle’s decision that the rule conflicts with the text of the law does seem to validate the new rule was unfairly benefiting insurers—to the detriment of both providers and patients – the very people the rule was designed to protect.

Where will this road lead? We’re hoping that “good intentions” change to “good action,” but it’s yet to be seen.

Original Article:

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