America's Health Insurance Plans Issues Public Comment on Centers for Medicare & Medicaid Services Proposed Rule

WASHINGTON, Oct. 23 -- Jeanette Thornton, senior vice president for product, employer and commercial policy at America's Health Insurance Plans, has issued a public comment on the Centers for Medicare and Medicaid Services proposed rule entitled "Requirements Related to Air Ambulance Services, Agent and Broker Disclosures, and Provider Enforcement". The comment was written on Oct. 18, 2021, and posted on Oct. 19, 2021:

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On behalf of AHIP, I am pleased to offer comments in response to the Notice of Proposed Rulemaking, "Requirements Related to Air Ambulance Services, Agent and Broker Disclosures, and Provider Enforcement" published September 16, 2021 in the Federal Register (86 FR 51730). AHIP is the national association whose members provide health care coverage, services, and solutions to hundreds of millions of Americans every day. We are committed to market-based solutions and public-private partnerships that make health care better and coverage more affordable and accessible for everyone.

AHIP strongly supported legislative efforts to ban the practice of surprise medical billing. This egregious business model went on for far too long and eroded Americans' confidence in our health care system while harming the financial security of millions of families each year. Strong enforcement of the No Surprises Act, including new accountability for air ambulance providers will be crucial to protecting consumers as the era of surprise medical billing ends. We offer comments in response to these proposed rules with that perspective.

Overall, we are largely supportive of the approach taken by the Departments with respect to new air ambulance reporting but offer technical feedback on how to streamline the reporting process. With respect to individual market disclosures of agent and broker compensation, we strongly support the approach that provides-flexibility and reduce administrative burden by allowing plans to incorporate agent and broker compensation disclosure with enrollment materials, permitting electronic disclosures, and not specifying a format for commission schedules or other documentation. Finally, we urge caution with the proposed expansion of the Department of Health and Human Services' (HHS') investigatory authority as to not duplicate existing authority of states.

Thank you for your consideration of our comments and recommendations and, as with other sections of the No Surprises Act, we look forward to continuing to engage with the Administration to ensure timely and successful implementation of this important law to ensure consumers will be protected from receiving surprise medical bills and have greater transparency into their health care.

Sincerely,

Jeanette Thornton

Senior Vice President

Product, Employer & Commercial Policy

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AHIP's comments on the proposed rule are organized into the following sections:

I. Reporting Requirements for Plans and Issuers Regarding Air Ambulance Services

II. Reporting Requirements Regarding Air Ambulance Services for Providers of Air Ambulance Services

III. Disclosure of Agent and Broker Compensation to Individuals in Individual Health Insurance Coverage or Short-term, Limited Duration Insurance

IV. CMS Enforcement of Group and Individual Insurance Market and Provider and Facility Requirements

I. Reporting Requirements for Plans and Issuers Regarding Air Ambulance Services (45 CFR 149.230)

We support efforts by the Departments to collect valuable new information regarding air ambulance services. Providers of air ambulance services have been among the professional groups most likely to entirely avoid contracting with health insurance plans and issuers and have sent some of the highest dollar amount surprise bills consumers have seen. Including these providers in requirements under the No Surprises Act was a huge victory for patients and reporting requirements will go a long way to better understanding their business practices and allow more health plans to bring them in network. We are hopeful the fruits of this reporting will provide valuable information to eventually bring down the cost of this critical, life-saving emergency transport method.

We offer the following comments on the specific reporting requirements:

A. Calendar Year Reporting

The proposed rules establish a calendar year reporting system with 90-days following the close of the preceding year for group health plans and health insurance issuers to submit data relevant to air ambulance services furnished within the calendar year, as well as data relevant to services for which payments were made within the calendar year.

Recommendations:

* We support calendar year reporting but recommend a June 30th (6 month) furnishing deadline, rather than 90-days as proposed. A March deadline does not provide adequate time to ensure all claims are processed and could result in missing data from the reports. Providing a reporting timeframe that runs through June 30th of the following year would be more appropriate and align to other reporting requirements such as annual reporting requirements of the National Association of Insurance Commissioners (NAIC).

* Additionally, as plans and issuers may not always have complete claims information submitted by air ambulance service providers, for the benefit of all parties involved, we recommend the inclusion of a de minimis safe harbor for minor oversights or exclusions of unavailable data.

B. Mergers and Acquisitions

An issuer that acquires from another issuer a line or block of business that provided coverage of air ambulance services during calendar years 2022 or 2023 would be required to report the air ambulance services data on behalf of the acquired business for the entire applicable calendar year. The Departments propose that these reporting requirements would apply to the selling and acquiring issuers if a sale or transfer occurs as a result of issuers being merged, combined, spun off, affected by, or engaging in any similar transaction during a calendar year.

Recommendation:

* AHIP urges the Departments finalize a rule that includes a good faith safe harbor for mergers and acquisitions of new lines of business should all data not be retained by the previous entity or supplied to the acquiring entity. Additionally, we recommend that entities acquired also be required to report the air ambulance data. We look forward to the Department's guidance illustrating these examples.

C. Submission of Claims Level Data

The No Surprises Act requires plans and issuers to submit claims data for air ambulance services. As a practical matter, we caution that the data submitted will be a very large file as the data instructions require reporting by group and by claim line and urge consideration of a streamlined method for capturing data and uploading the required data.

Recommendations:

* Emergent vs. non-emergent claims: Clarification is needed as to how HHS intends to define an emergent vs. non-emergent claim, including specifications as to which diagnostic or billing codes will be considered emergent vs. non-emergent. Plans use CPT and HCPCS codes that delineate emergent vs. non-emergent and would prefer uniformity between the code systems' definitions of emergent vs. non-emergent and the final rule.

* Definition of Rural and Urban Areas: Clarification is requested as to the standard intended to be used to define rural vs. urban areas, in particular its application on the reporting forms. The field no longer exists on the reporting form provided in the PRA template, which includes reference to a zip code.

* Aircraft Type: A good faith safe harbor is requested for instances where the transport entity does not provide necessary information, such as the type of aircraft used, and some information would only be known by the air ambulance provider.

* Program Type: The report requests a specific data element-whether the provider of such services is part of a hospital-owned or sponsored program, municipality-sponsored program, hospital independent partnership (hybrid) program, independent program, or tribally operated program in Alaska. Today air ambulance providers generally do not include this information in their claims submission and health plans do not require this information in order to process the claim. We recommend the agencies solely rely upon providers of air ambulance services to report this information.

* Reason for Denial: Both plans and issuers as well as air ambulance providers must provide claims adjudication information including whether a claim was paid or denied, the denial reason, and appeal outcome. The Paperwork Reduction Act package indicates that plans and issuers are to provide a denial reason code and this information is also to be included in the public report issued by HHS. AHIP recommends that HHS define a list of "reasons for denial" for uniformity purposes. There are a wide range of reasons a claim may be denied, including insurance affordability, lack of accurate or complete information submitted by the provider, duplicate claims, claims that are denied but ultimately approved (e.g., because information was missing or submitted incorrectly by the provider), denials due to inaccurate claims coding, denials because another payer (e.g., Medicare) is the primary payer and must process first. Issuers may approach such scenarios differently, which often reflect administrative processes or systems build, rather than coverage policy. For example, one issuer may pend a claim when additional information or documentation is needed while another issuer may deny the claim but subsequently approve the claim when it is resubmitted with accurate, complete information. Because there is variation across issuers administrative and systems processes as well as variation in claims denial reporting processes (i.e., qualified health plan transparency in coverage information) have encountered significant challenges resulting from lack of clear, standard definitions and requirements.

D. Public Report

The statue requires HHS, in consultation with the U.S. Department of Transportation, to produce a comprehensive public report analyzing data points not collected as part of the requirements listed above. These analyses include: an assessment of the average charges for air ambulance services; amounts paid by plans and issuers to providers of air ambulance services; amounts paid out-of-pocket by consumers; the frequency of patient balance billing; and the frequency of claims appeals made by providers of air ambulance services to plans and issuers.

Recommendations:

* AHIP recommends that HHS define a list of "reasons for denial" for uniformity purposes. We urge caution in describing denial reasons as definitions of what constitutes a claim denial would be quite complex. An overly broad reporting requirement would result in reporting claim denial rates that aren't representative of actual denials. As described above, some of the most common reasons for claims denials include insurance eligibility, duplicate claims, claims denied but ultimately approved (e.g., because information was missing or submitted incorrectly by the provider), denials due to inaccurate claims coding, denials because another payer (e.g., Medicare) is the primary payer and must process first. Public reporting requirements should focus on the result for the patient--whether the service is ultimately covered--rather than denials that reflect internal administrative or systems practices. Thus, claims that are ultimately paid should not be required to be reported as denied claims. Doing so would align with NAIC Market Conduct Annual Statement (MCAS) requirements, which excludes claims that were ultimately paid.

* We recommend removing cost-sharing information from the public report as this information would not generally be readily available in HHS releases detailed data files. In lieu of this approach, HHS could provide the public with general trends around cost-sharing for air ambulance services.

E. Group Health Plan Reporting

With respect to the requirement that group health plans are to report required information to HHS, the proposed rules note that nothing prevents a self-insured group health plan from contracting with another party, such as a third-party administrator, to report the required information.

Recommendation:

* To avoid unnecessary duplication and to streamline the process, AHIP recommends the Departments require reporting from one entity with responsibility for claims data and to designate the third-party administrator as that entity.

F. Applicability to Excepted Benefits and Treatment of Expatriate Plans

Plans report some ambiguity with respect to whether reporting requirements apply to HIPAA Excepted Benefits and we therefore urge the Departments to expressly clarify that plans consisting solely of Excepted Benefits are exempt from these requirements and to similarly expressly exempt expatriate health plans.

II. Reporting Requirements Regarding Air Ambulance Services for Providers of Air Ambulance Services (45 CFR 149.460)

AHIP believes the information collection proposed will be valuable in understanding air ambulance transports and the impact of the No Surprises Act on patients receiving care and transportation by these providers and supports these requirements as reasonable.

III. Requirements Related to Reporting and Disclosure - Disclosure of Agent and Broker Compensation to Individuals in Individual Health Insurance Coverage or Short-term, Limited Duration Insurance (45 CFR 148.410)

A. Disclosure Requirements

HHS proposes minimum standards for health insurance issuers offering individual health insurance coverage or short-term limited duration insurance for disclosure to a potential or existing policyholder, including the amount of direct and indirect compensation provided to an agent or broker associated with enrolling the policy holder in individual health insurance coverage or short-term limited duration insurance.

Recommendations:

AHIP supports HHS' approach to provide flexibility and reduce administrative burden by allowing plans to incorporate agent and broker compensation disclosure with enrollment materials, permitting electronic disclosures, and not specifying a format for commission schedules or other documentation. HHS should not require disclosure of compensation information on other forms of documentation confirming enrollment. We offer the following additional recommendations for consideration:

* Maintain maximum flexibility for plans to allow for accurate disclosure of complex broker compensation structures. AHIP supports HHS' proposal to allow plan flexibility to describe thresholds for indirect compensation, such as bonuses. HHS should maintain maximum flexibility for plans that allow for disclosure of complex or variable compensation structures, such as ranges, formulas, or other general descriptions that accurately describe compensation to consumers.

* Clarify that in-house agents employed by health plans are exempt from disclosure requirements. Health plans employ agents to assist with the sale of insurance contracts, and these agents receive a typical salary for their work. This job description does not meet the definition of "services" or "brokerage services" and an employee's salary does not meet the definition of "compensation" requiring disclosure. Therefore, HHS should exempt in-house agents from health plan disclosure requirements under Section 202, similar to previous Department of Labor guidance related to pension plan disclosures.

* Exempt student health coverage from broker compensation disclosure and reporting requirements. While student health coverage is considered individual health insurance coverage, it is unique because this coverage is provided as an agreement between a higher education institution and a health insurance issuer. Unlike other forms of individual health insurance coverage, student health coverage does not include direct sales action between agents or brokers and students. HHS should clarify that student health coverage is excluded from broker compensation and disclosure reporting requirements.

* Confirm disclosure and reporting requirements do not apply to excepted benefits. Many plans offer coverage for products like long-term care or disability that are considered excepted benefits. Section 202(c) added Sec. 2746 to the PHSA, which imposes certain disclosure and reporting requirements on health insurance issuers with respect to health insurance coverage and short-term limited duration insurance coverage regarding compensation provided to agents and brokers. These disclosure requirements apply in the context of individual market health insurance coverage. HHS should explicitly confirm that broker compensation disclosure requirements do not apply to excepted benefits described by PHSA Sec. 2791(c). This is because PHSA Sec. 2763 provides that the "requirements of this part," which includes PHSA Sec. 2746, do not apply to excepted benefits where certain conditions are met.

* Create a safe harbor for calculation errors and give plans the ability to modify after disclosure or reporting. As previously mentioned, broker compensation structures are complex and variable. Along with disclosure and reporting flexibility, plans should have a specified timeframe to correct errors in disclosure or revise previous reporting to ensure continued accuracy. HHS should establish a safe harbor for calculation errors where plans can correct broker compensation disclosure or reporting without penalty.

B. Reporting Requirements

HHS proposes data collection, reporting requirements, and submission timeline for issuers to submit annual reporting reflecting compensation arrangements between agents and brokers and health insurance issuers.

Recommendation:

* Finalize reporting timeline as proposed. AHIP supports HHS' proposed reporting timeline of the last business day of July of the calendar year following the applicable reporting period. Establishing a submission deadline that does not coincide with the Exchange open enrollment period will reduce conflict with existing plan operations. HHS should finalize this timeline as proposed.

C. Applicability

HHS proposes that these requirements apply to contracts executed between an agent or broker and a health insurance issuer offering individual health insurance coverage or short-term limited duration insurance on or after December 27, 2021, with a temporary policy of relaxed enforcement between December 27, 2021 and January 1, 2022.

Recommendation:

* Delay Section 202 requirements to plan years beginning on or after January 1, 2023 and provide good faith safe harbor for enforcement. HHS should delay broker compensation requirements to plan years beginning on or after January 1, 2023 and provide a good faith safe harbor for enforcement. While AHIP appreciates HHS' option to exercise discretion to adopt a temporary policy of relaxed enforcement on a case-by-case basis for the December 27, 2021 through January 1, 2022 reporting period, plans do not have enough time to implement information technology changes in time for the proposed deadline. Since a rule is not likely to be finalized until November or December of 2021, plans will be unable to update plan materials and provide necessary documentation to agents and brokers to accurately report compensation amounts for the 2022 plan year.

Plans need additional time to locate and track data elements required by the proposed rule, work with intermediary organizations to obtain compensation information, establish new programs and systems, train staff, agents and brokers, harmonize existing state requirements and agent and broker agreements, and develop new or revise existing materials and notices. In some cases, these materials and notices have been filed and approved by state regulators and must be sent to enrollees by statutory timelines, which will not allow for inclusion of additional disclosures. A delay of at least one year to plan years beginning on or after January 1, 2023 with a good faith safe harbor for enforcement will enable plans to make necessary updates, provide accurate consumer disclosures, and come into compliance with the law.

IV. CMS Enforcement of Group and Individual Insurance Market and Provider and Facility Requirements (45 CFR Part 150)

A. Definitions (45 CFR 150.103)

HHS proposes to add definitions related to enforcement against providers and facilities.

Recommendation:

* AHIP supports these definitions and urges clarity that the definition of health care "provider" should include nurse practitioners and physician assistants operating as licensed health care professionals in their State.

B. Request for Extension (45 CFR 150.309)

HHS is proposing to remove references to "30 days" to request an extension and clarifying that a responsible entity may request an extension when it cannot prepare a response or provide the requested information to HHS by the deadline provided in the notice under 45 CFR 150.307, and that failure to respond by the initial deadline provided in the notice or an extended deadline granted by HHS may result in the imposition of a civil money penalty based upon the complaint or other information alleging or indicating a violation of PHSA requirements.

HHS also proposes to codify examples of what would be considered "good cause" for failure to timely respond, including but not limited to, situations when a responsible entity indicates that it has limited staffing resources to prepare a response, or when a responsible entity requests clarification from HHS regarding its request for information.

Recommendation:

* We urge HHS not to remove the 30-day period for responding to notices or to request an extension. We suggest additional examples of what constitutes "good cause," including, but not limited to situations when the notice is directed to the inappropriate contact at the group health plan or health insurance issuer.

C. Basis for Initiating an Investigation; Injunctive Relief (45 CFR 150.503)

We are concerned that the language proposed by HHS would create new investigatory authority that exceeds the parameters of the No Surprises Act, resulting in duplicative enforcement with state Departments of Insurance. The Proposed Rules' permit HHS to determine whether to initiate an investigation or a market-conduct examination (MCE) based on receiving information indicating that a group health plan or health insurance issuer may have failed to meet a PHSA requirement or, alternatively, conduct a random MCE to assess compliance with any provision of the PHSA. The language used is vague and raises concerns that future regulatory authority could be exercised without sufficient notice to parties.

The structure proposed, particularly if it is applicable to every state, would result in parallel enforcement by state and federal authorities for the same conduct. This may be a simple matter of clarifying the application to select states where HHS has primary enforcement authority rather than a nationwide scope. It is critical that the process for investigations and enforcement of potential violations of law is administratively simple, when possible, and clear as to which governmental entity bears responsibility for enforcement.

Recommendations:

* With respect to these proposed rules, AHIP urges the Departments to limit the scope of the rules to enforcement of the No Surprises Act or other sections within the same title of the Consolidated Appropriations Act (CAA). Should HHS believe new investigatory and enforcement authority is necessary under the PHSA, separate rulemaking should be noticed on that topic.

* We urge the Departments to complete an economic assessment of the impact of this change in enforcement approach. It is unclear from the language in this NPRM whether that is the intention; no cost or economic analysis has been completed for the proposed new MCEs, which are expressly distinguished in the NPRM from investigations, and therefore Administrative Procedures Act requirements to avoid arbitrary rulemaking have not been satisfied.

Related to costs, we ask HHS, in final rulemaking, to establish and clarify projected enforcement costs outlined in less detail in the Preamble. For example, the Preamble refers to "CMS [conducting] approximately 200 investigations per month, for a total of 2,400 investigations per year, starting in 2022" but it is unclear whether the use of the word "investigation" refers solely to investigations or MCEs and investigations./1

We infer from the Preamble that "investigations" refer to actions in response to alleged, potential violations of the PHSA, rather than random or targeted MCEs, but this unclear. The projected costs seem to envision enforcement only of the specific provisions of the CAA, including the No Surprises Act, referenced in these Proposed Rules, but there is a lack of clarity in the rules as proposed that could lead to an interpretation that all MCEs were part of the cost estimate.

* Clarify whether CMS is seeking to initiate investigations and exercise primary enforcement authority beyond the states where HHS has primary enforcement authority under the Public Health Service Act. HHS enforcement authority has historically been limited to those states - currently numbering four - that notify the federal government they are not going to enforce (or otherwise fail to substantially enforce) requirements of the PHSA. We read the proposed rules as most likely limited to those four states but recognize there is confusion as to whether the enforcement authority proposed could be viewed as nationwide and therefore urge HHS to clarify that enforcement rules under the CAA do not extend beyond those states where HHS has primary enforcement authority.

D. Market Conduct Examinations (45 CFR 150.313)

With respect to proposed changes to the rules for Market Conduct Examinations (MCEs), we are concerned that codifying current MCE practices and procedures will not allow for the flexibility necessary in dealing with the unique circumstances of each audit.

Recommendation:

* Should HHS codify the MCE practices and procedures as proposed, AHIP strongly recommends that:

1. HHS permit issuers to designate a single point of contact to which MCE notices should be sent. Notices are not always sent to the same individual at large companies, and in the absence of a designation, it may take several days or longer to make their way to the appropriate contact

2. HHS add other examples of "good cause" for failure to respond to notice of an MCE including, but not limited to, situations when the notice is directed to the inappropriate contact at the plan/issuer

E. Determining the Amount of Penalty--Aggravating Circumstances (45 CFR 150.321)

HHS proposes to specify that an entity's failure to cooperate with an investigation or MCE would be considered an aggravating circumstance for purposes of determining the aggregate amount of penalty.

Recommendation:

* We are concerned that the penalty for aggravating circumstances could be arbitrarily applied and recommend: 1) HHS specify what constitutes a "failure to cooperate" and 2) HHS provide for a process that allows issuers to request review/appeal of the assessment by a neutral third party not involved in the original decision to assess the penalty for aggravating circumstances. The process should allow issuers to appeal the determination that there was a failure to respond to take into account circumstances where an issuer may fail to respond simply because the notice was directed to the inappropriate contact at the company.

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Footnote:

1/ 86 FR 51766

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The proposed rule can be viewed at: https://www.regulations.gov/document/CMS-2021-0147-0001

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