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Court Rules in Favor of Physicians in Lawsuit Challenging No Surprises Act

In a win for physicians and hospitals, for the second time in less than two years, a federal court in Texas has rejected the Biden Administration’s attempt to rewrite the independent-dispute resolution process that Congress created in the No Surprises Act (NSA). The NSA bans surprise medical bills for out-of-network care and establishes a process for resolving payment disputes between health plans and providers.

Unfortunately, the final rule implementing the law continued to give preference to the qualifying payment amount (QPA) — or median in-network rate — which unfairly favors insurers when settling out-of-network payment disputes. In contrast to the final rule, the NSA requires arbiters to consider several factors equally — not just median in-network rates — including the physician’s training and experience, the severity of the patient’s medical condition, prior contracting history, health plan market share and other relevant information.

According to the court, the final rule “continues to place a thumb on the scale for the QPA by requiring arbitrators to begin with the QPA and then imposing restrictions on the non-QPA factors that appear nowhere in the statute.” In sending parts of the regulations back to the agencies, the court ruled that “rather than instructing arbitrators to consider all the factors pursuant to the Act, the Final Rule requires arbitrators to consider the QPA first and then restricts how they may consider information relating to the non-QPA factors.”

On Oct. 19, the AANS and the CNS spearheaded a physician-led amicus brief, along with the Physician Advocacy Institute, supporting the Texas Medical Association’s (TMA) lawsuit challenging these rules. The Biden Administration has until early April to appeal the decision.