Since January 1, 2022, the Centers for Medicare & Medicaid Services (CMS) has required Qualifying Payment Amounts (QPAs) to establish member cost sharing for items and services falling under the protection of the No Surprises Act (NSA).Health plans and issuers must shield members from balance billing arising from emergency services rendered at out-of-network emergency facilities, non-network providers rendering non-emergency services at in-network facilities, and from out-of-network air ambulance providers.
To ensure compliance with QPA requirements CMS has begun to take enforcement action, auditing health plans and issuers. This past May, CMS published a final report identifying a health plan that was out of compliance, with three findings, two of these critical deficiencies in QPA are noted here:
- Failing to properly calculate the QPA by using claim paid amounts instead of contracted rates
- Failing to share the QPA in remittance advice sent with the initial payment or in the notice of denial of payment.
The NSA and Regulations have established clear guidance for QPA calculation
By way of a quick level set, for services falling under the protections of the NSA, a “recognized amount” must be determined, to establish the basis for member cost sharing. By law and regulation, the payer must determine the recognized amount following these mandated steps:
- The amount determined by an applicable All-Payer Model Agreement
- The amount determined by applicable state law
- Failing to have amounts specified by 1 or 2, the lesser of the provider billed amount or the Qualifying Payment Amount.
Outside of the few states that have All-Payer Model Agreements, and where state law does not otherwise mandate a payment amount for an item or service, health plans and issuers must calculate the Qualifying Payment Amount following regulatory required methods.
CMS requires Qualifying Payment Amounts to be determined by identifying the median contracted rate on 1/1/2019, for the same or similar item or service, in the same market (Individual, small group, large group), for providers in the same or similar specialty, in the geographic region in which the item or service was furnished, adjusted annually for inflation. When a median contracted rate can be determined, this is the Qualifying Payment amount. When a median contracted rate cannot be determined, there is “insufficient information” to determine the QPA.
Solving for insufficient information
When a health plan or issuer has insufficient information to calculate a QPA using the median contracted rate, CMS requires the plan or issuer to determine the QPA using an eligible database. Since the enactment of The No Suprises Act, MarketScan® by Merative has served as a premier third-party database used by payers to determine QPAs.
Calculate QPAs with compliance and confidence
The MarketScan Reimbursement Benchmarks for QPA accelerates compliance by offering a robust benchmark methodology to determine the QPA when faced with insufficient evidence to determine a median contracted rate. This affords your members with the consumer protection required by the No Surprises Act.
Success story: Simplifying and accelerating QPA determination
In October of 2021, a large health plan client started sharing concerns with Merative about how they were going to comply with the upcoming mandates. They understood how to develop their own QPAs using contracted rates, but were anxious to line up an eligible third-party database before the mandate went into effect. With the unpredictability of when or where a member might experience an emergency, health plans are left with a narrow window for identifying and offering a QPA to the servicing provider. After learning about the depth and breadth of the Reimbursement Benchmarks for QPA solution, they partnered with Merative and were able to bring the full dataset in house before the end of the year.
Reimbursement Benchmarks for QPA are designed with the understanding that clients are not able to work with a vendor in real-time to determine a QPA on a case-by-case basis. Therefore, our solution consists of datasets that are easily ingestible into any system, allowing ease of access to the needed QPA.
The month after ingesting the Reimbursement Benchmarks for QPA data files, the health plan faced their first instance in which an eligible database was needed to determine QPAs. One of their members traveled to a state outside their network and received emergency services covered by the surprise billing protections of the No Surprises Act. The health plan was able to use Reimbursement Benchmarks for QPA quickly and efficiently, lining up the servicing market, site of service, CPT/HCPCS – Modifier combination, and provider specialty and land on the appropriate QPAs for services rendered. Confidence that the data they relied on was a fair representation of in-network rates for that specific market and set of services enabled the health plan to act quickly and decisively to remain compliant and navigate the new mandates with ease. They remain a partner of ours to this day.
Our Reimbursement Benchmarks solution has consistently received strong market acceptance for accuracy and the wide representation of the data included. Because of this strong base, we are able to rapidly refine the offering to specifically offer median allowed amounts in the commercial market, creating tailored Reimbursement Benchmarks for QPA. Covering every geographic region and market nationwide to the specifications outlined in the rule, Reimbursement Benchmarks for QPA facilitates the identification of a QPA when a payer lacks sufficient information to determine their own QPA.
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