Section 400.1 is amended to expand the applicability of the regulation to include emergency services provided by non-participating hospitals and inpatient services that follow an emergency room visit, to clarify to which services the AOB and hold harmless requirements apply, and to describe to which hospitals the regulation does not apply.

Section 400.2 is amended to revise the definition of “dispute resolution process” and add a definition of “hospital.”

Section 400.3 is amended to add references to inpatient services that follow an emergency room visit and references to non-participating hospitals.

Section 400.5 is amended to outline the responsibilities of health care plans for disputes involving hospital bills for emergency services, including inpatient services that follow an emergency room visit, and to expand the responsibilities of health care plans for disputes involving surprise bills. In a dispute involving a non-participating hospital that had not previously entered into a participating provider agreement with the health care plan, the health care plan must pay the claim in an amount it deems reasonable and may attempt to negotiate the amount. In a dispute involving a non-participating hospital that had previously entered into a participating provider agreement with the health care plan, the health care plan must pay the claim in an initial amount prescribed by statute, but may submit a dispute to independent dispute resolution (“IDR”) if it believes the initial amount is not reasonable.

The amendment outlines the process for a health care plan to submit such a dispute to IDR, which includes notifying the non-participating hospital of the health care plan’s best and final offer and providing the non-participating hospital with 15 business days to respond with its best and final offer before submitting the dispute. In all disputes for emergency services and inpatient services following an emergency room visit, the health care plan must pay the claim directly to the non-participating physician or non-participating hospital if an insured assigns benefits to the non-participating physician or non-participating hospital.

Health care plans, upon receipt of a claim for the services of a non-participating physician or other non-participating referred health care provider that could be a surprise bill and that is not submitted with an AOB form, also must provide the insured with notice that if the bill is a surprise bill and the insured submits an AOB form, then the insured will incur no greater out-of-pocket costs for the services than the insured would have incurred with a participating physician or other health care provider. The notice also must direct the insured to contact the health care plan or visit the health care plan’s website for additional information regarding surprise bills and to obtain an AOB form for surprise bills.

If a health care plan receives an AOB form and determines that the bill is not a surprise bill, then the health care plan must provide a written notice of such determination that includes the procedures for filing a grievance under Insurance Law section 4802 or Public Health Law section 4408-a and information on how to file a complaint with the Superintendent of Financial Services.

Section 400.6 is amended to detail the responsibilities of non-participating hospitals for disputes regarding emergency services, including inpatient services that follow an emergency room visit. When billing patients for emergency services, including inpatient services that follow an emergency room visit, non-participating physicians and non-participating hospitals must provide claim forms and AOB forms to patients, and if an insured assigns benefits for such services, then the non-participating physician or non-participating hospital may not bill or seek payment from the insured, except for any applicable copayment, coinsurance, or deductible that would be owed if the insured utilized a participating physician or hospital.

When a health care plan attempts to negotiate reimbursement with a non-participating hospital that had not previously entered into a participating provider agreement with the health care plan, the non-participating hospital has at least seven business days to respond to the health care plan’s offer. With respect to disputes involving emergency services, including inpatient services that follow an emergency room visit, rendered by a non-participating hospital that had previously entered into a participating provider agreement with a health care plan, if the non-participating hospital believes that the initial payment amount paid by the health care plan is not reasonable, then the non-participating hospital may submit a dispute to IDR and propose an amount it deems reasonable.

The amendment outlines the process for a hospital to submit such a dispute to IDR, which includes notifying the health care plan of the hospital’s best and final offer and providing the health care plan with 15 business days to respond with its best and final offer before submitting the dispute. If the IDR entity (“IDRE”) issues a determination in favor of the health care plan in such a dispute, then the non-participating hospital must pay any amount owed to the health care plan within 30 days from the date of the determination.

Section 400.7 is amended to add references to inpatient services that follow an emergency room visit and non-participating hospitals. It also requires health care plans to submit information about the coverage type when submitting disputes to IDR, and requires parties to disputes involving a non-participating hospital that had previously entered into a participating provider agreement with the health care plan, for emergency services, including inpatient services that follow an emergency room visit, to provide their best and final offer when submitting disputes.

Section 400.8 is amended to add references to non-participating hospitals and to the best and final offers of the parties for disputes involving a non-participating hospital that had previously entered into a participating provider agreement with the health care plan. The amendment provides that, in disputes involving a health care plan, in determining a reasonable fee for the services rendered, an IDRE shall select either the health care plan’s payment, or in cases involving a non-participating hospital that had previously entered into a participating provider agreement with the health care plan, the health care plan’s best and final offer, if applicable, or the non-participating physician’s or other non-participating referred health care provider’s fee, or the non-participating hospital’s fee, or, in cases involving a non-participating hospital that had previously entered into a participating provider agreement with the health care plan, the non-participating hospital’s best and final offer, as applicable. The amendment also provides that in determining a reasonable fee, the IDRE must consider any other information submitted by the parties, in addition to the conditions and factors set forth in Financial Services Law section 604.

Section 400.10 is amended to add references to non-participating hospitals and to the best and final offers of the parties regarding disputes involving a non-participating hospital that had previously entered into a participating provider agreement with the health care plan.

1. Statutory authority: Financial Services Law (“FSL”) sections 202, 301, and 302 and Article 6 and Insurance Law (“IL”) section 301.

FSL section 202 establishes the office of the Superintendent of Financial Services (“Superintendent”).

FSL section 301 authorizes the Superintendent to take such action as the Superintendent deems necessary to protect and educate users of financial products and services.

FSL section 302 and IL section 301, in pertinent part, authorize the Superintendent to prescribe regulations interpreting the IL and to effectuate any power granted to the Superintendent in the IL, FSL, or any other law.

FSL Article 6 establishes an independent dispute resolution (“IDR”) process through which a dispute involving a bill for emergency services or a surprise bill may be resolved. This includes disputes involving hospital bills for emergency services and inpatient services that follow an emergency room visit. FSL Article 6 also sets forth hold harmless requirements and assignment of benefits (“AOB”) rights and obligations for emergency services, including inpatient services that follow an emergency room visit. FSL Article 6 further authorizes the Superintendent to promulgate regulations establishing standards for the IDR process.

2. Legislative objectives: Chapter 60 of the Laws of 2014 added FSL Article 6 to address the issue of consumers receiving unexpected medical bills for emergency services performed by out-of-network physicians and surprise bills from out-of-network physicians, hospitals, and other providers of health care services (collectively, “providers”). Chapters 375 and 377 of the Laws of 2019 amended FSL Article 6 to address hospital bills for out-of-network emergency services and inpatient services following an emergency room visit. Part YY of Chapter 56 of the Laws of 2020 further amended FSL Article 6 to provide new hold harmless requirements and AOB rights and obligations for emergency services, including inpatient services that follow an emergency room visit. Article 6 provides that consumers must be held harmless for out-of-network emergency bills and surprise bills and directs health maintenance organizations and insurers authorized to do business in New York State (collectively, “health care plans”) to work out payment for these bills with providers. Article 6 establishes an IDR process by which a dispute involving a bill for emergency services, including inpatient services following an emergency room visit, or a surprise bill may be resolved.

This rule accords with the legislative objective set forth in FSL Article 6 by implementing the new rights and obligations for disputes involving hospital bills for emergency services and inpatient services that follow an emergency room visit as established by Chapters 375 and 377 and Part YY of Chapter 56; requiring a health care plan to provide an insured with a notice explaining whether the bill is a surprise bill and that if the insured submits an AOB form, then the insured will incur no greater out-of-pocket costs for the services than the insured would have incurred with a participating provider; and requiring non-participating physicians and hospitals that bill for emergency services to provide insureds with a claim form and AOB form.

3. Needs and benefits: The IDR process established by Chapter 60 of the Laws of 2014 and implemented by 23 NYCRR 400 has protected several thousands of consumers from bills for emergency services and surprise bills; however, it did not originally include hospital bills for emergency services and inpatient services that follow an emergency room visit. This rule implements the new rights and obligations for disputes involving hospital bills for emergency services and inpatient services that follow an emergency room visit. The rule sets forth the responsibilities of health care plans, hospitals, and IDR entities (“IDREs”) in relation to the IDR process and details the process to submit disputes involving hospital bills for emergency services and inpatient services that follow an emergency room visit.

Furthermore, while Article 6 and Part 400 have protected many insureds, in certain circumstances, an insured may not be aware that the insured may seek protection from a surprise bill or file a grievance if the insured’s health care plan determines that the bill was not a surprise bill. This rule requires health care plans, upon receipt of a claim for the services of a non-participating physician or non-participating referred provider that could be a surprise bill and that is not submitted with an AOB form, to provide the insured with notice on, or in conjunction with, an explanation of benefits (“EOB”) that explains whether the bill is a surprise bill and that if the insured submits an AOB form, then the insured will incur no greater out-of-pocket costs for the services than the insured would have incurred with a participating provider. The notice also must direct the insured to contact the health care plan or visit the health care plan’s website for additional information regarding surprise bills and to obtain an AOB form. If a health care plan receives an AOB form and determines that the bill is not a surprise bill, then the health care plan must provide a written notice of such determination that includes the procedures for filing a grievance under IL section 4802 or Public Health Law section 4408-a and information on how to file a complaint with the Superintendent.

Finally, this rule requires non-participating physicians and hospitals that bill for emergency services to provide insureds with a claim form and AOB form, which are currently only required to be provided with surprise bills.

4. Costs: Health care plans, physicians, and hospitals may incur minimal additional costs to comply with the rule. Any additional costs to hospitals to submit disputes to IDR are imposed by statute. Hospitals and physicians may incur additional costs to provide claim forms and AOB forms with bills for out-of-network emergency services; however, any additional costs for physicians should be minimal because the current law and existing regulation already require physicians to provide claim forms and AOB forms to insureds who receive surprise bills.

The additional costs for health care plans may include costs to amend notifications sent to insureds when they receive a claim for the services of a non-participating provider that could be a surprise bill or when health care plans receive an AOB form but determine that the bill is not a surprise bill. However, the additional costs should be minimal because the existing regulation already requires health care plans to provide insureds with notice on, or in conjunction with, an EOB advising the insured that the claim could be a surprise bill. The amendment merely expands the notice that must be included on, or in conjunction with, the EOB. Similarly, IL section 4802 and Public Health Law section 4408-a currently require health care plans to provide grievance and grievance appeal determinations to insureds, and the amendment merely clarifies that health care plans should treat as a grievance any determination that a bill is not a surprise bill.

The Department of Financial Services will not incur any costs to implement this rule since the IDREs will conduct the actual review of the disputes.

The rule will not impose compliance costs on any local governments.

5. Local government mandates: The rule does not impose any program, service, duty or responsibility on any county, city, town, village, school district, fire district or other special district.

6. Paperwork: Health care plans, hospitals, and physicians may incur additional paperwork to comply with this rule because they will need to provide insureds with additional notices. This rule identifies the information that must be submitted to the IDRE, including the IDR application, as required pursuant to FSL Article 6, for disputes involving a hospital bill for emergency services or a bill for inpatient services that follow an emergency room visit. Furthermore, health care plans and hospitals that had previously entered into a participating provider agreement and intend to submit a dispute regarding a bill for emergency services or inpatient services following an emergency room visit to IDR must contact the other party and provide their best and final offer along with an explanation of how it was calculated, and also notify the other party at the time of the submission to the Superintendent.

7. Duplication: This rule does not duplicate, overlap, or conflict with any existing state or federal rules or other legal requirements.

8. Alternatives: With respect to the additional notice required to be provided on, or in conjunction with, an EOB upon a health care plan’s receipt of a claim for services that could be a surprise bill and is not submitted with an AOB form, the Department considered requiring the notice to include a description of what constitutes a surprise bill, a description of the IDR process, an AOB form for surprise bills, and the health care plan’s designated electronic and mailing addresses. However, the Department streamlined what was originally proposed and instead will require the notice to explain that if the bill is a surprise bill and the insured submits an AOB form, then the insured will incur no greater out-of-pocket costs for the services than the insured would have incurred with a participating physician or provider. The notice also must direct the insured to contact the health care plan or visit the health care plan’s website for additional information regarding surprise bills and to obtain an AOB form for surprise bills. This is consistent with other provisions of the existing IDR regulation, which impose similar notice requirements upon a health care plan’s receipt of a claim for a surprise bill or other services of a non-participating provider.

The Department also considered requiring an additional notice in adverse determination letters when a health care plan determines that services were not emergency services and denies the claim as not medically necessary. However, in light of the 2019 and 2020 amendments to FSL Article 6 providing that inpatient services following an emergency room visit are eligible for IDR as emergency services, the Department decided that it is no longer necessary to require health care plans to include additional notifications in adverse determinations.

Additionally, the Department considered requiring non-participating physicians and hospitals that bill patients for emergency services to provide consumer disclosure information to patients. However, the Department determined that requiring these non-participating physicians and hospitals to provide patients with claim forms and AOB forms was sufficient.

The Department further considered requiring IDREs, when considering the usual and customary cost of the service in disputes involving non-participating physician services, to consider the usual and customary cost of the service in the zip code where services were rendered, as well as in surrounding, nearby zip codes. However, FSL Article 6 does not require IDREs reviewing disputes involving non-participating physician services to consider the usual and customary cost of the service in surrounding, nearby zip codes. Nevertheless, the existing regulation allows parties to submit any other information they deem relevant, and the Department added a provision to the rule that requires an IDRE to consider any other information submitted by the parties. Therefore, if any of the parties wish for the IDRE to consider this information, then they may submit it for consideration.

9. Federal standards: Public Health Service Act section 2719A (42 U.S.C. section 300gg-19a) requires health care plans to cover emergency services. Federal regulations implementing this law (45 C.F.R. section 147.138(b)) require health care plans to reimburse out-of-network providers of emergency services at the greatest of the following: (1) the amount negotiated with in-network providers for the emergency service, excluding any in-network copayment or coinsurance; (2) the amount for the emergency service calculated using the same method the plan generally uses to determine payments for out-of-network services, excluding any in-network copayment or coinsurance; or (3) the amount that would be paid under Medicare for the emergency service, excluding any in-network copayment or coinsurance. The IDR process for hospital bills established under this rule will allow health care plans and hospitals to dispute amounts above the federal requirement.

10. Compliance schedule: The amendment will take effect 30 days after publication of the Notice of Adoption in the State Register.

1. Effect of the rule: This rule affects all health maintenance organizations and insurers authorized to do business in New York State (collectively, “health care plans”). Based upon information that health care plans have provided in their annual statements and filed with the Department of Financial Services (“Department”), they are not “small businesses” as defined in State Administrative Procedure Act (“SAPA”) Section 102(8) because they are not independently owned and operated and do not employ 100 or fewer employees.

However, this rule affects physicians and hospitals, some of whom or which may be small businesses under SAPA. The Department does not maintain records of the number of physicians or hospitals licensed in this state that are small businesses.

This rule does not affect local governments.

2. Compliance requirements: No local government will have to undertake any reporting, recordkeeping, or other affirmative acts to comply with this rule because the rule does not apply to any local government.

A physician or hospital, who or that is a small business, will be subject to reporting, recordkeeping, or other compliance requirements because the physician or hospital will need to provide a claim form and an assignment of benefits (“AOB”) form to a patient when billing for emergency services and inpatient services that follow an emergency room visit.

Furthermore, hospitals participating in independent dispute resolution (“IDR”) will be subject to notice requirements when submitting disputes.

3. Professional services: No local government will need professional services to comply with this rule because the rule does not apply to any local government. No physician or hospital, who or that is a small business affected by this rule, should need to retain professional services, such as lawyers or auditors, to comply with this amendment.

4. Compliance costs: No local government will incur any costs to comply with this amendment because the amendment does not apply to any local government. Health care plans, physicians, and hospitals may incur minimal additional costs to comply with the rule. Any additional costs to hospitals to submit disputes to IDR are imposed by statute. Hospitals and physicians may incur additional costs to provide claim forms and AOB forms with bills for out-of-network emergency services; however, any additional costs for physicians should be minimal because the current law and existing regulation already require physicians to provide claim forms and AOB forms to insureds who receive surprise bills.

5. Economic and technological feasibility: This rule does not apply to any local government; therefore, no local government should experience any economic or technological impact as a result of the rule.

Physicians and hospitals, who or that are small businesses, should not incur any economic or technological impact as a result of the rule.

6. Minimizing adverse impact: There will not be an adverse impact on any local government because the rule does not apply to any local government. This rule should have no adverse impact on hospitals that are small businesses because it only establishes standards for an IDR process for hospital bills for emergency services and inpatient services following an emergency room visit that is already prescribed by statute, and participation in the IDR process is voluntary. This rule should not have an adverse impact on physicians who are small businesses because it only requires non-participating physicians who bill patients for emergency services to send the same disclosures that are already required to be sent for surprise bills.

7. Small business and local government participation: Interested parties, including physicians and hospitals, who or that may be small businesses, were given an opportunity to comment on the proposed rulemaking that was published in the State Register on October 23, 2019.

1. Types and estimated numbers of rural areas: Insurers authorized to do business in New York State and health maintenance organizations (collectively, “health care plans”), physicians, and hospitals affected by this amendment operate in every county in this state, including rural areas as defined by State Administrative Procedure Act section 102(10).

2. Reporting, recordkeeping and other compliance requirements; and professional services: Health care plans, hospitals, and physicians, including those in rural areas, may be subject to additional reporting, recordkeeping, or other compliance requirements because they will need to provide insureds with additional notices. This rule identifies the information that must be submitted to the independent dispute resolution (“IDR”) entity (“IDRE”), including the IDR application, as required by Financial Services Law Article 6, for disputes involving a hospital bill for emergency services or a bill for inpatient services that follow an emergency room visit. Furthermore, health care plans and hospitals that had previously entered into a participating provider agreement and intend to submit a dispute regarding a bill for emergency services or inpatient services following an emergency room visit to IDR must contact the other party and provide their best and final offer along with an explanation of how it was calculated, and also notify the other party at the time of the submission to the Superintendent of Financial Services (“Superintendent”).

Health care plans, physicians, and hospitals, including those in rural areas, should not need to retain professional services, such as lawyers or auditors, to comply with this amendment.

3. Costs: Health care plans, physicians, and hospitals, including those in rural areas, may incur minimal additional costs to comply with the rule. Any additional costs to hospitals to submit disputes to IDR are imposed by statute. Hospitals and physicians may incur additional costs to provide claim forms and AOB forms with bills for out-of-network emergency services; however, any additional costs for physicians should be minimal because the current law and existing regulation already require physicians to provide claim forms and AOB forms to insureds who receive surprise bills.

The additional costs for health care plans may include costs to amend notifications sent to insureds when they receive a claim for the services of a non-participating physician or a non-participating referred health care provider that could be a surprise bill that is not submitted with an AOB form or when health care plans receive an AOB form but determine that the bill is not a surprise bill. However, the additional costs should be minimal because the existing regulation already requires health care plans to provide insureds with notice on, or in conjunction with, an explanation of benefits (“EOB”) to advise the insured that the claim could be a surprise bill. The amendment merely expands the notice that must be included on, or in conjunction with, the EOB. Similarly, Insurance Law section 4802 and Public Health Law section 4408-a currently require health care plans to provide grievance and grievance appeal determinations to insureds, and the amendment merely clarifies that health care plans should be treating a determination that a bill is not a surprise bill as a grievance.

4. Minimizing adverse impact: This amendment uniformly affects health care plans, physicians, and hospitals that are located in both rural and non-rural areas of New York State. The amendment should not have an adverse impact on rural areas.

5. Rural area participation: The Department held numerous meetings with health care plans and hospital associations, including those located in rural areas, during which they were given an opportunity to comment on the drafting of this rule. Interested parties, including health care plans, hospitals, and physicians located in rural areas, also were given an opportunity to comment on the proposed rulemaking that was published in the State Register on October 23, 2019.

The Department of Financial Services (“Department”) finds that the revised proposed amendment should have no substantial adverse impact on jobs or employment opportunities in New York because the amendment merely expands the current independent dispute resolution process to include disputes involving hospital bills for emergency services and inpatient services that follow an emergency room visit, and requires health maintenance organizations, insurers authorized to do business in New York State, and physicians to provide certain notices and forms related to surprise bills and bills for emergency services to insureds.

The New York State Department of Financial Services (the “Department”) received comments from associations that represent insurers and health maintenance organizations (“health care plans”) and from organizations that represent plastic surgeons. Some of the comments supported the proposed regulation, while others requested changes or expressed concern that the proposed regulation’s requirements would be unreasonably burdensome and not beneficial to consumers.

Comment: The proposed regulation requires health care plans, upon receipt of a claim for the services of a non-participating physician or non-participating referred health care provider that could be a surprise bill that is not submitted with an assignment of benefits form, to provide insureds, on or in conjunction with an explanation of benefits (“EOB”), with the following additional notifications, which are currently required to be posted to the health care plan’s website: (1) a description of what constitutes a surprise bill; (2) a description of the independent dispute resolution (“IDR”) process; (3) an assignment of benefits (“AOB”) form for surprise bills; (4) the health care plan’s designated electronic and mailing addresses where the AOB can be submitted; and (5) information on how an insured or provider may submit a dispute to an IDR entity. Two commenters expressed concern that there is limited space on an EOB and that adding the additional notifications to the EOB would add complexity to the document, confuse insureds, and provide no additional benefit to consumers. One commenter expressed concern that including web disclosures in EOBs will make the communications unwieldy and will be extremely difficult to implement from an operational perspective, particularly attaching an AOB form to these automated communications. The commenter suggested that web disclosures instead should include a reference to, and a link for, a blank AOB form and additional information.

Response: Health care plans already must post to their websites an AOB form for surprise bills, along with a description of what constitutes a surprise bill, a description of the IDR process, the health care plan’s designated electronic and mailing addresses where the AOB can be submitted, and information on how an insured or provider may submit a dispute to an IDR entity. While the law and existing regulation have protected many insureds, in certain circumstances, insureds still may not be aware that they may seek protection from a surprise bill. The intent of the proposed regulation is to make consumers aware that a bill could be a surprise bill and to provide them with information about what to do when they receive one. The Department believes that requiring additional notifications to be provided on or in conjunction with an EOB will inform more consumers that they can seek protection from surprise bills.

However, to address the concerns raised in the comments, the Department amended the regulation to streamline what the Department originally proposed. Instead of requiring the notice to provide a description of what constitutes a surprise bill, a description of the IDR process, an AOB form for surprise bills, and the health care plan’s designated electronic and mailing addresses where the AOB form can be submitted, the regulation will require the notice to explain that if the bill is a surprise bill and the insured submits an AOB form, then the insured will incur no greater out-of-pocket costs for the services than the insured would have incurred with a participating physician or health care provider. The notice also must direct the insured to contact the health care plan or visit the health care plan’s website for additional information regarding surprise bills and to obtain an AOB form for surprise bills. This is consistent with other provisions of the existing IDR regulation, which impose similar notice requirements upon a health care plan’s receipt of a claim for a surprise bill or other services of a non-participating health care provider.

Comment: The proposed regulation requires that if a health care plan determines that the services of a non-participating physician or a non-participating referred health care provider at a participating hospital are not emergency services and makes an adverse determination pursuant to Insurance Law or Public Health Law Article 49, then the health care plan must include additional notifications in the initial and final adverse determinations informing the insured that a bill for the services may be a surprise bill and could be eligible for IDR. One commenter expressed concern that including the surprise bill notifications in adverse determination letters would be misleading to members since the surprise bill process would not apply to these cases. The commenter stated that a claim for emergency services is submitted with a “place of service” code, indicating that services were provided in the emergency room, or a revenue code, indicating that emergency services were provided. The commenter argued that regardless of whether a health care plan denies the claim as not medically necessary, a claim for emergency services submitted with the applicable “place of service” or revenue code is still a claim for emergency services and cannot be a surprise bill because Financial Services Law § 603(h) explicitly provides that a surprise bill is a bill for health care services “other than emergency services.”

Response: Financial Services Law § 603(b) provides that “emergency services” include all services provided by the physician until the patient is stabilized, regardless whether the services are provided in the emergency room. If the services provided meet the definition of “emergency services,” then they should be considered emergency services regardless of the “place of service” or revenue code used. The commenter is correct that Financial Services Law § 603(h) explicitly provides that a surprise bill is a bill for health care services “other than emergency services.” However, if the health care plan determines that the services were not emergency services, then they could be “other than emergency services” and therefore a surprise bill. It also is important to note that if emergency services are determined not to be medically necessary, then a different process for disputing the determination would apply. Instead of the IDR process, which is used to determine a reasonable payment amount for a bill for emergency services or a surprise bill, when emergency services are determined not to be medically necessary, the external appeal process would apply. The consumer would have the right to an external appeal of the determination that the services were not medically necessary.

Regardless, it is the Department’s position that in light of changes made by Chapters 375 and 377 of the Laws of 2019 and Part YY of Chapter 56 of the Laws of 2020, which expanded the IDR process to include hospital bills for emergency services and inpatient services that follow an emergency room visit, it is no longer necessary to require health care plans to include additional notifications in the initial and final adverse determinations informing the insured that services determined not to be emergency services could be eligible for IDR as a surprise bill. Therefore, the Department removed this requirement from the proposed regulation.

Comment: One commenter expressed concern that including the surprise bill disclosures in adverse determination letters will make the communications unwieldy, lengthy, and extremely difficult to implement from an operational perspective, particularly with respect to attaching an AOB form to these automated communications; will require rewriting of final adverse determination (“FAD”) notices; and will complicate health care plans’ grievance and appeals notifications and processes. The commenter suggested an alternative approach wherein the notices refer the insured to the plan’s webpage that includes all the surprise bill and IDR information.

Response: Under the new laws referenced above, inpatient services following an emergency room visit are now eligible for IDR as emergency services, and it is no longer necessary to require health care plans to include additional notifications in the initial and final adverse determinations informing the insured that services determined not to be emergency services could be eligible for IDR as a surprise bill. Therefore, the Department removed this requirement from the proposed regulation.

Comment: The proposed regulation requires that if a health care plan receives an AOB form for a surprise bill and determines that a bill for the services is not a surprise bill, then the health care plan must provide written notice of such determination, including the procedures for filing a grievance. If a health care plan makes a determination on a grievance disputing that a bill is a surprise bill, then the health care plan must provide written notice of such determination, including the procedures for filing an appeal. One commenter expressed concern about further complicating the process regarding health care plans’ grievance and appeals notifications and processes.

Response: The Department wants to ensure that insureds are aware of their rights regarding surprise bills and are informed about how to dispute them. Benefit determinations made by health care plans, including determinations that a bill is not a surprise bill, are subject to the grievance procedure requirements in the Insurance Law and Public Health Law, and insureds should be informed of their rights to file grievances and appeals of such determinations. Additionally, health care plans also should be aware that federal rules regarding claim determinations also apply to a determination that a bill is not a surprise bill and thus not eligible for payment. See 29 C.F.R. § 2560.503-1 and 45 C.F.R. § 147.136.

The proposed regulation merely clarifies how health care plans should have been treating a determination that a bill is not a surprise bill. However, the Department amended the regulation to streamline the provision regarding a health care plan’s determination of a grievance disputing that a bill is a surprise bill to simply state that the health care plan shall comply with the Insurance Law § 4802 or Public Health Law § 4408-a grievance requirements.

Comment: One commenter expressed concern about how health care plans can determine whether inpatient services are due to an emergency room admission given that claims often come in at different times. The commenter requested clarification of how health plans should manage this practical challenge.

Response: The Insurance Law and regulations promulgated thereunder have mandated coverage for emergency services and inpatient hospital services for quite some time and the proposed regulation does not change these requirements. In addition, certain requirements, such as pre-authorization, may not be imposed on emergency services, but may be imposed on inpatient admissions that do not result from an emergency admission. Health care plans currently make determinations as to whether inpatient services are due to an emergency admission and they already should have mechanisms in place to identify whether inpatient services are due to an emergency admission. Therefore, the Department did not make any changes in response to this comment.