Evaluation of the QPA in the No Surprises Act

evaluation of the qpa

Throughout the implementation and revisions of the No Surprises Act, the Qualifying Payment Amount, or QPA, has been the center of controversy. The insurer-controlled QPA rate allows insurance companies to underpay healthcare providers. Even with a final ruling in place, the challenges of the federal IDR process revolve around questionable practices which indirectly instruct arbitrators to favor the QPA. Learn more about the use of the QPA throughout revisions of the No Surprises Act, including the final ruling, in these articles.

On August 19th, 2022, the Biden Administration released the final ruling on the No Surprises Act and its IDR process.

Legislators announced there would be no more surprise billing for patients for out-of-network care starting January 1, 2022. However, the IDR process was implemented with little clarity for providers and uses low reimbursement rates.

Many healthcare providers are outraged. There have already been lawsuits conducted by the American Hospital Association, the Texas Medical Association, and the American Medical Association. These organizations believe the IDR process gives insurance companies too much power.

While the final ruling was meant to benefit providers, the ‘QPA’ rate—an insurer-controlled rate—is still being used to determine the final reimbursement from insurance companies to healthcare providers.

This final ruling does little to restore healthcare providers’ confidence in the IDR process and gives them more reason to pursue reimbursement through litigation.

The American Society of Anesthesiologists’s No Surprises Act question of the week from 8/29/2022 identifies the shortcomings of the Department of Labor’s amendment of the IDR process, frustrating healthcare providers across all fields. 

The final ruling continues to allow the QPA to be used as a reference rate in deciding proper provider reimbursements.

Not surprisingly, the QPA rates are significantly lower than the out-of-network rates.

This is often due to concepts such as “ghost codes,” which insurance companies use to decide rates. Unseen by anyone who is not a part of the insurance company, these codes leave providers’ reimbursements decided solely by payers, contributing to an overall imbalanced process. 

The use of the QPA in the IDR and the NSA’s final ruling proves the federal IDR process is not a reliable method of deciding reimbursement rates for healthcare providers. 

Luckily, the IDR is not the only way to challenge underpaid rates for out-of-network emergency care. Allia Group’s unique model recovers revenue for physician groups and returns power to the physicians and hospitals who deserve it for providing lifesaving care.

In the No Surprises Act IDR process, CMS announced federal entities would determine ‘fair’ reimbursement to healthcare providers for emergency out-of-network services by referencing the Qualified Payment Amounts (QPA).

Healthcare providers evaluated the QPA as an insufficient form of reimbursement, compared to rates used by states in local government IDR processes such as the Usual and Customary Rate (UCR) used in some states, including California and Connecticut. 

According to this study from August of 2022, one of the main issues with the QPA is that it is dictated entirely by the health insurance companies’ data. Insurance companies are using rates from PCPs in their contracts—rates that are significantly lower than fair and reasonable rates for providing emergency care. The QPA calculation dictates that the value must be decided from the ‘same or similar specialty.’

Ultimately, it’s further proof that the cumbersome federal IDR process is not a sufficient way of recapturing revenue on out-of-network emergency claims.

In late September of 2022, a federal judge in Texas, once again, struck down the portion of the No Surprises Act which presumes the QPA or median in-network rate as the correct rate to be considered during the IDR process.

This was great news for out-of-network providers, brought about by suits from the Texas Medical Association and air ambulance company LifeNet EMS.

However, it is important to note that while the new rule “barely complies with the court’s decisions in (these two suits), it is still improperly favoring the QPA and indirectly instructing arbitrators to favor the QPA.

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