PREFERRED VENDOR A Summary of the Employee Benefit Plan Provisions Contained in the Consolidated Appropriations Act of 2021 What Plan Administrators and Benefit Managers Need to Know Philip Talley, Vice President Insurance Services, Illinois Bankers Association As the year 2020 came to a close, Congress passed the Consolidated Appropriations Act of 2021, a colossal $2.3 trillion spending bill that combined $900 billion in stimulus relief with a $1.4 trillion omnibus spending bill for the 2021 federal fiscal year. This broad and extensive legislation contained much more that just spending appropriations. The law also contained numerous provisions impacting various areas of concern for U.S. employers. Among these are several new laws that apply to employee benefit plans. The employee benefit plan provisions contained within this bill can be broken down into four main categories1: 1. “Surprise Billing” Reforms 2. Broker Compensation Disclosure 3. Transparency Requirements 4. Temporary Special Rules for Flexible Spending Accounts (FSAs) and Dependent Care Accounts (DCAs) “Surprise Billing” refers to the amounts that patients must pay after unknowingly and unintentionally receiving care from an out-of-network provider. This often occurs when emergency services are provided, or when a non-network provider performs services at an in-network facility. A common example of this is when a non-network specialist, such as an anesthesiologist,
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provides services at an in-network hospital. This has been a longterm problem for many healthcare consumers and is often viewed as a “kick them while they’re down approach” because it most often affects people who are experiencing significant health issues and it penalizes patients for things that were out of their control. Effective January 1, 2022, this law will require that emergency services and “certain non-emergency services from non-network providers” provided in a hospital or free-standing emergency clinic, be billed at the same level for in-network and out-of-network providers with regards to the patient’s out-ofpocket costs. Allowable charges must be equal to the median price allowed for in-network providers for the same procedure in the same geographic region. The law further requires that all out-of-network costs incurred by the patient must count toward the in-network deductible and out-of-pocket limit.2 The law also places new limitations on billing for air ambulance services. To address the inevitable disputes over surprise billing issues, the law provides for the establishment of Independent Dispute Resolution (IDR) to be administered by “non-affiliated, independent, unbiased entities.” The Secretaries of Health and Human Services, Labor, and Treasury are tasked with establishing the IDR rules that all group health plans and insurers must follow. Rules
governing the methodology to determine qualifying payment amounts, the information required to make payment determination, geographic regions, and a process for receipt of complaints, must be determined by July 1, 2021. An audit program must be established by October 1, 2021. The Act also establishes various billing and cost transparency requirements, designed to minimize the “surprise” aspects of medical billing. These include the following: • Requiring all health plans and insurers to provide “in clear writing, on any physical or electronic plan or ID card” the following information: • Any deductible applicable to the plan’s coverage • Any out-of-pocket maximum limitation • The telephone number and website address where individuals can obtain consumer assistance. • Requires advance Explanation of Benefits (EOB) be made available to any requesting health care provider, participant, beneficiary, or enrollee verifying whether the provider is in or out-of-network and the contracted rate for the item or service. • Telephonic and internet price comparison information must be made available.3
