Jack Towarnicky, member of aequum, recently presented as a guest speaker during Humaculture’s Hidden Opportunities, Strategic Compliance Series. This was the first of a five-part series of monthly webinars that offer guidance to plan sponsors and third-party claims administrators on how to strategically respond to the No Surprises Act (NSA) and Transparency in Coverage requirements. The top takeaway is to illustrate how a plan sponsor might respond strategically to create a competitive advantage while minimizing cost and compliance complexity.
A recording of this online seminar can be accessed and viewed here.
Beyond NSA Compliance – Securing a Competitive Financial Advantage
On January 1, certain provisions of the NSA took effect to protect health plan participants from surprise medical bills for emergency services as well as care received from out-of-network providers at an in-network facility.
Simple NSA compliance will increase employer-paid medical expenses and add to the cost of coverage. Transparency is expected to add to medical cost inflation by prompting both in-network and out of network providers to increase charges.
The best response is through an approach that is both strategic and compliance oriented. A dual approach will minimize the compliance challenge, reduce the cost of coverage for both the employer and employees, and, at the same time, improve both the perceived and actual value of health coverage.
The Health Plan MVP (Most Valuable Provision)
Jack confirmed that Reference-Based Pricing (RBP) is an example of a strategic response to avoid compliance with many aspects of the NSA. RBP brings transparency to health care prices by using Medicare reimbursement rates and/or other provider cost data to provide an objective cost baseline. RBP offers disciplined pricing to ensure fair and rational provider reimbursements.
NSA Risk to RBP
RBP may be subject to the NSA Independent Dispute Resolution process where plan designs incorporate a provider network or where the plan directly contracts with facilities and providers. The NSA will affect RBP plans that use narrow networks or have negotiated contracts with certain providers and plans that utilize RBP as the mechanism to price out-of-network claims.
Adopting a pure RBP plan that puts the patient in the driver’s seat as a health care consumer is the most effective way to respond to the legislation. Just as important, deploying RBP may avoid unreasonable or excessive provider charges – potentially lowering both the cost of coverage (employer and employee contributions, over time) and employee point of purchase cost sharing (deductibles, copayment, coinsurance).
aequum helps plan sponsors and administrators by adding protection through our software and data-driven solutions that provide a strong defense in disputes over unreasonable or excessive charges. As your partner, we are here to address your concerns and help you and your plan participants succeed in 2022. Please contact us if you have any questions.