IDR Parties Should Confirm Process Compliance Today — Before Proposed Rule Adds New Requirements

Improving transparency and communication in the Federal Independent Dispute Resolution (IDR) process is an important goal of the Proposed Operations Rule, now undergoing its final review with the Office of Budget and Management.   

The changes proposed by “the Departments” (Health & Human Services, Labor and Treasury) are relevant to both health plans and health care providers. Now is the time to prepare for them.  

Understanding the proposed changes to open negotiation and batching, for example, allows parties to plan for internal process, system, or staffing changes. FHAS encourages parties to review their processes now and prepare to adjust them as needed. We are working with parties now to help them realign as needed for optimal outcomes now and in the future. Talk to us about your process. 

FHAS can help ensure your organization’s clarity around what is required now, and what the proposed rule would add to the process. Our experience reviewing thousands of cases as a leading IDRE convinces the FHAS team that certain components of the current regulations are not well understood.  For example, early communication between payers and providers often does not include the required information or disclosures.  

Federal IDR Compliance: Required Now Under Existing Rules 

Under the existing regulations, as recapped in the proposed rule Fact Sheet, when a payer receives and adjudicates a claim, it must disclose to the provider important information about the claim. Expanded details of what must be included were published in Appendix A “Disclosures required to be made with the initial payment or notice of denial of payment, or upon request” in Guidance for Certified IDRE’s in August 2022.  

• The qualifying payment amount (QPA) must be disclosed.
• In addition, payers must certify that the QPA applies for the purposes of the recognized amount and was determined in compliance with the July 2021 interim final rules.  
• Contact information for initiating the open negotiation period must be provided. 
• Or, more specifically, “a statement that if the provider … wishes to initiate a 30-day open negotiation period … the provider 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 … the provider may initiate the Federal IDR within four days after the end of the open negotiation period.”  
• Contact information must include a telephone number and email address for the appropriate person or office.  
• Appendix A of the August 2022 guidance goes on to require payers to provide, “in a timely manner” additional information on request, including specific details on the QPA calculations, services codes, databases used, and any risk-sharing or other incentive-based payments or adjustments, excluded from the QPA calculations.  

Proposed Rule Additions 

In addition to the above existing requirements of the initial adjudication communications between payers and providers, the proposed operations rule includes additional details that must be included in these initial communications, including:  

• Payers must provide the legal business name of the payor, its IDR registration number, and the plan sponsor (e.g., employer or union) if applicable.   
• The proposed rule would initiate an IDR Registry. Payers subject to the Federal IDR process would register with the Departments and provide “general information on how the federal IDR process applies to items or services covered by the plan. The plans would receive an IDR registration number, presumptively enabling initiating parties to determine earlier if a dispute is eligible for the process.  
• A statement that providers must notify the Departments through the Federal IDR portal – or the Federal IDR Gateway — to initiate open negotiation.  
• Payers must use specific claim adjustment reason codes (CARCs) and remittance advice remark codes (RARCs) to communication information about “whether a claim for an item or service furnished by an out-of-network provider or facility is or is not subject to the No Surprises Act’s surprise billing provisions and eligible for the Federal IDR process. The specific codes “will be specified in guidance” and will be “distinct from the list of NSA-related RARCs effective on March 1, 2022, which would remain available for voluntary use by payers.”  

The Departments have stated that the goal for these changes is to improve communication between parties and reduce the number of ineligible payment disputes submitted to the Federal IDR processes and requirements. Visit our online resources or contact us to set up a consultation.