The No Surprises Act (NSA) is a bipartisan effort to protect patients from unexpected healthcare expenses. This law is good news for patients, with a KFF poll showing that 1 in 3 insured adults between 18 and 64 received an unexpected medical bill in the prior two years. The NSA aims to make the cost of care more transparent and minimize surprise billing, which can cause significant financial burdens through higher out-of-pocket expenses and denied claims. Under the NSA, patients now receive preliminary good faith estimates of care costs and can seek care feeling confident they understand the price.
While the implications of the NSA are a relief for patients, health plans and providers can’t say the same. Providers are experiencing administrative and payment-related challenges, and payers have to navigate delayed revenue recognition. Since COVID, the frequency providers have updated their data is on the rise, and payers are struggling to keep up. Now, health plans must comply with the regulations of the NSA, making the daunting volume of provider updates even more unmanageable.
The State of Play
Under the NSA, health plans must meet a series of stringent requirements establishing a verification process that ensures the accuracy of their provider directories. Inaccurate provider directories and compliance failures are grounds for hefty federal and state fines. The verification requirements for health plans are as follows:
- Establish a verification and removal process for unverified providers
- Verify and update provider information every 90 days
- Update payer databases within 48 hours of receiving new provider information
- Respond to all requests regarding a provider’s network status within 24 hours
With hundreds of thousands of in-network providers, administrators are burdened with a near-impossible challenge to remain compliant. Unfortunately, many existing provider databases use datacraping and cold calling tactics to gather information, which produces unreliable, sporadic results.
The Cost of Non-compliance
Imagine for a moment you’re a regional health plan with 40,000 members, and the information in your member directory is inaccurate. The federal government can fine you up to $100 per individual impacted by those errors while also fining providers up to $10,000 for errors. So, if you’ve got 40,000 members, the math becomes pretty compelling to get your data in order.
An organization in this situation faces more than overwhelming federal penalties; each state can also set its own fines. Altogether, the need to have accurate directories is non-negotiable, and those payer organizations that are unprepared to meet verification requirements will need to make significant adjustments to their business processes to avoid violating the NSA.
Automating the Path Forward
Payers will need to make significant adjustments to avoid violating regulations and incurring these hefty fines, including to how they manage their provider directories. It’s important to note that organizations investing in the tools to keep directories up-to-date can benefit in multiple ways simultaneously.
Simplifying healthcare administration could save the industry $250 billion, but instead, a persistent, antiquated, siloed approach that relies on incompatible systems is trapping data and making the exchange of information slow and complex. If the NSA has made one thing clear, it’s that there is a substantial need throughout the industry for a payer solution that solves compliance issues and automates data management.
Data delivery and maintenance are among the most prominent administrative headaches payers face, making an automated solution a crucial piece of adhering to federal regulations like the No Surprises Act. Providers and payers need a sophisticated infrastructure that facilitates the seamless exchange of critical information, creating a single source of truth and eliminating inefficient information silos. Furthermore, this type of provider data exchange could simplify transactions between payers and providers so they can stay compliant with the No Surprises Act through real-time provider directory updates. Administrators can focus on other essential tasks when data can be automatically verified and updated in all necessary places.
Undoubtedly, implementing The No Surprises Act was a significant and necessary win on behalf of patients. But the dust won’t settle until payers and providers successfully implement the processes and technology required to consistently meet the NSA verification requirements. The time and costs of completing administrative tasks are already bleeding the industry and eating into quality patient care. Without a strategic, nimble, and automated approach to handling the new requirements, payers and providers alike can expect to feel financial and administrative pain for a long time.
About Eric DemersEric Demers is the CEO of Madaket Health. He believes we can transform healthcare delivery through the power of data and interoperability. With more than 25 years of global healthcare experience, Eric has built and scaled leading technology and service companies, from early stage to Fortune 100. He is highly sought-after for speaking and consulting on international health, having advised global entities and governments on critical issues facing healthcare. A growth-minded leader, Eric has founded three companies and exited two. Eric previously served in strategy-focused executive roles at IBM, Accreon, MEDecision and Orion Health. He is a graduate of Brandeis University and The George Washington University School of Medicine and Health Sciences.