A Texas judge yesterday held that the federal government’s revised independent dispute resolution process for determining payment for out-of-network services under the No Surprises Act skews the arbitration results in commercial insurers’ favor in violation of the compromise Congress reached in the Act.
“The Court concludes that the challenged portions of the Final Rule are unlawful and must be set aside under the Administrative Procedure Act (“APA”),” wrote United States District Court Judge Jeremy Kernodle ruling in favor of the Texas Medical Association in a case brought against the departments of Health and Human Services, Labor, and the Treasury.
As a result of this decision, the regulations are vacated nationwide and, as Judge Kernodle wrote, “arbitrators will decide cases under the statute as written without having their hands tied by the Departments.”
In a statement shared with the media, AHA General Counsel and Secretary Melinda Hatton said, “The AHA is pleased with yesterday’s ruling, which restores the balanced, patient-friendly dispute resolution that Congress chose when it enacted the No Surprises Act. The district court correctly observed that the government’s final rule would have tilted arbitrations in favor of insurers, thereby inappropriately lowering payments to health care providers and threatening patient access to care. With the court now having struck down two regulations as inconsistent with the No Surprises Act, we hope the departments will work with hospitals and health systems to implement the fair process Congress intended.”
The AHA and American Medical Association in October filed a friend-of-the-court brief in support of the TMA.