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The ACA and CAA Patient Protections

Question: How did the CAA modify and expand upon the ACA’s original patient protections provisions?

Short Answer: For plan years beginning on or after January 1, 2022, the CAA adds multiple significant new patient protection provisions and more broadly imposes the original ACA patient protection provisions.

General Rule: The New ACA/CAA Patient Protections Provisions

The Consolidated Appropriations Act, 2021 (CAA) significantly expanded the original ACA patient protection provisions for plan years beginning on or after January 1, 2022.

There are five main types of patient protections under the ACA and the new CAA “No Surprises Act” structure:

  • Primary care provider, OB/GYN, and pediatrician designation (originally in the ACA);
  • Emergency services coverage (originally in the ACA);
  • Preventing surprise medical bills (added by the CAA);
  • Ending surprise air ambulance bills (added by the CAA); and
  • Continuity of care (added by the CAA).

Note: The original ACA patient protections are effective in their original form for plan years beginning on or after September 23, 2010 through the date the CAA changes take effect for the first plan year beginning on or after January 1, 2022.

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The patient protection rights do not apply to excepted benefits, such as dental and vision plans.

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Patient Protection #1: Primary Care Provider Designation (Originally in the ACA)

This requirement from the original ACA is the best-known patient protection provision, largely because of the employee notice requirements.

Medical plans that require designation of a primary care provider must permit enrolled employees and dependents to designate any primary care provider who is available to accept such individual.  This right extends to designation of an in-network pediatrician for covered children.  Women also generally have the right to access care from an OB/GYN without prior authorization.

Employers sponsoring a group health plan with medical plan options that require designation of a primary care provider (e.g., HMOs) must provide the patient protection notice to plan participants whenever an SPD or other similar description of benefits is provided.  Although it is not technically required to be provided annually, many employers follow the best practice approach of including the patient protection notice with other annual notice materials.  The DOL makes available a model patient protection notice.

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CAA Changes to the Primary Care Provider Designation Patient Protection

The CAA provides that as of the first plan year beginning on or after January 1, 2022, the primary care provider designation patient protection provisions apply to both ACA non-grandfathered and grandfathered plans.

Prior to 2022, this patient protection applied only to non-grandfathered health plans.  This continues the trend of moving toward the near irrelevance of maintaining ACA grandfathered plan status.

Patient Protection #2: Emergency Services Coverage (Originally in the ACA)

This patient protection from the original ACA primarily requires medical plans that cover emergency services to provide out-of-network emergency coverage and impose the same copay and coinsurance cost-sharing that apply to an in-network emergency provider for any out-of-network emergency services.

The plan may impose a deductible for out-of-network emergency services only as a part of a deductible that generally applies to out-of-network benefits.  Similarly, if an out-of-network out-of-pocket maximum generally applies under the plan, it must also apply to out-of-network emergency services.

This patient protection also provides that the plan cannot impose prior authorization or any other coverage limitation that is more restrictive than those imposed on in-network providers.

CAA Changes to the Emergency Services Coverage Patient Protection

The CAA provides that as of the first plan year beginning on or after January 1, 2022, the emergency services coverage patient protection provision no longer applies in its original form.  The original ACA provision is replaced by the broader CAA patient protection provision designed to prevent surprise medical bills, known as the “No Surprises Act.”

The CAA provisions largely incorporate and expand upon the original ACA emergency services coverage patient protections in the broader context of preventing surprise billing generally (i.e., not limited to emergency services) described in #3 below.

Patient Protection #3: Preventing Surprise Medical Bills (Added by the CAA)

The CAA adds an extensive set of patient protections referred to as the “No Surprises Act.”  Among those provisions are a series of rights and limitations designed to prevent surprise medical bills.  These provisions are effective for plan years beginning on or after January 1, 2022, and they apply to both ACA non-grandfathered and grandfathered plans.

As noted in #2 above, these CAA provisions replace and expand upon the original ACA emergency services coverage patient protections to include both emergency and non-emergency services.

Emergency Services

Medical plans that cover emergency services must generally cover such services:

  1. Without any prior authorization requirement;
  2. Regardless of whether the provider is in-network;
  3. Without imposing any requirement or limitation that is more restrictive for out-of-network emergency providers than in-network emergency providers;
  4. Without any greater cost-sharing than would apply for in-network emergency services; and
  5. By applying the cost-sharing payments for out-of-network emergency services toward any in-network deductible or out-of-pocket maximum in the same manner as if the services were provided in-network.

“Cost-sharing” for these purposes includes copayments, coinsurance, and (unlike the original ACA protection) deductibles.

Non-Emergency Services

Medical plans that cover out-of-network non-emergency items and services must generally cover such services:

  1. Without any cost-sharing requirement that is greater than would apply if provided in-network;
  2. By calculating the cost-sharing as if the total amount charged by the provider is the “recognized amount” for such items and services;
  3. With initial notice of payment or denial transmitted to the provider within 30 calendar days of the bill for such services;
  4. With payment to the provider within 30 days of the determination date for any amounts exceeding the cost-sharing owed by the participant; and
  5. By counting the cost-sharing payments toward any in-network deductible and out-of-pocket maximum in the same manner as if the services were provided in-network.

The “recognized amount” is generally an averaging of cost determination, with the specific determination set based on state law if applicable, or otherwise set the Social Security All-Payer Model Agreement.

Independent Dispute Resolution Process

The CAA adds an independent dispute resolution process that permits the plan to engage in a 30-day negotiation process with the out-of-network provider.  If the open negotiation period is unsuccessful, either party may initiate an independent dispute resolution process designed to determine the appropriate cost in a format similar to arbitration, with many strict procedural requirements.

The independent dispute resolution will come to a determination within 30 days of initiation.  Costs of the process are borne by losing party.

Patient Protection #4: Ending Surprise Air Ambulance Bills (Added by the CAA)

The CAA adds an extensive set of patient protections referred to as the “No Surprises Act.”  Among those provisions are a series of rights and limitations designed to end surprise air ambulance bills.  These provisions take effect for plan years beginning on or after January 1, 2022, and they apply to both ACA non-grandfathered and grandfathered plans.

Medical plans that provide coverage for air ambulance services must generally cover such services by an out-of-network air ambulance provider in the following manner:

  1. By applying the same cost-sharing that would apply if the air ambulance provider were in-network; and
  2. Counting the cost-sharing amounts towards the in-network deductible and in-network out-of-pocket maximum in the same manner as if the services were provided in-network.

Air ambulance services include medical transport by helicopter or airplane.  They do not include traditional motor vehicle ground ambulances.

The plan has 30 days after receiving the bill for the out-of-network air ambulance services to respond to the provider with the initial notice of payment or denial.  There can be no balance billing charged to the participant in the process.  An independent dispute resolution process similar to the one described above in #3 will apply where the parties cannot agree to the appropriate out-of-network rate.

Plans will have a two-part, Tri-Agency reporting requirement to provide claims data related to air ambulance services.  The report will include information about the types, providers, locations, and aircrafts used in all air ambulance services provided.  The first report will be due 90 days after the last day of the first calendar year beginning on or after the date that final regulations take effect.  The second report will be due 90 days after the last day of the calendar year immediately succeeding the first reporting requirement.

Patient Protection #5: Continuity of Care (Added by the CAA

The CAA adds an extensive set of patient protections referred to as the “No Surprises Act.”  Among those provisions are a series of rights and limitations designed to provide 90 days of continuity of care where in-network providers leave the plan’s network.  These provisions take effect for plan years beginning on or after January 1, 2022, and they apply to both ACA non-grandfathered and grandfathered plans.

Medical plans are generally subject to the continuity of care patient protections for “continuing care patients” with respect to a provider or facility where:

  1. The in-network contractual relationship terminates;
  2. Plan benefits terminate because of a change in the plan’s terms of participation for the provider or facility; or
  3. The termination of a group health plan’s contract with a health insurance carrier causes loss of benefits for the provider or facility.

“Continuing care patients” are individuals who, with respect to a provider or facility, are:

  1. Undergoing a course of treatment for a serious and complex condition;
  2. Undergoing a course of institutional or inpatient care;
  3. Scheduled to undergo nonelective surgery from the provider (including postoperative care);
  4. Pregnant and undergoing a course of treatment for the pregnancy from the provider or facility; or
  5. Determined to be terminally ill and receiving treatment for such illness.

The patient protection provision requires the plan to offer continuing care patients the opportunity to elect to continue benefits with the provider or facility for up to 90 days of transitional care under the same terms and conditions that would have applied with respect to such items and services had the termination not occurred.

Where these continuity of care patient protections apply, the plan must notify each individual who is a continuing care patient of the right to elect transitional care from the provider upon one of the events described above.  The plan must also provide the continuing care patient the opportunity to notify the plan of the need for transitional care.

Regulations

CAA Division BB §102(d)(2) [Application to Grandfathered Plans]:

https://www.congress.gov/bill/116th-congress/house-bill/133/text

(2) APPLICATION TO GRANDFATHERED PLANS.—Section 1251(a) of the Patient Protection and Affordable Care Act (42 U.S.C. 18011(a)) is amended by adding at the end the following: ‘‘(5) APPLICATION OF ADDITIONAL PROVISIONS.—Sections 2799A–1, 2799A–2, and 2799A–7 of the Public Health Service Act shall apply to grandfathered health plans for plan years beginning on or after January 1, 2022.’’.

PHSA §2719A(e) [Cessation of Original ACA Emergency Services Protection]:

(e) APPLICATION.—The provisions of this section shall not apply with respect to a group health plan, health insurance issuers, or group or individual health insurance coverage with respect to plan years beginning on or on [sic] January 1, 2022.


Brian Gilmore

About the author

Brian Gilmore

Brian Gilmore is the Lead Benefits Counsel at Newfront. He assists clients on a wide variety of employee benefits compliance issues. The primary areas of his practice include ERISA, ACA, COBRA, HIPAA, Section 125 Cafeteria Plans, and 401(k) plans. Brian also presents regularly at trade events and in webinars on current hot topics in employee benefits law. Connect with Brian on LinkedIn.


The information provided is of a general nature and an educational resource. It is not intended to provide advice or address the situation of any particular individual or entity. Any recipient shall be responsible for the use to which it puts this document. Newfront shall have no liability for the information provided. While care has been taken to produce this document, Newfront does not warrant, represent or guarantee the completeness, accuracy, adequacy, or fitness with respect to the information contained in this document. The information provided does not reflect new circumstances, or additional regulatory and legal changes. The issues addressed may have legal, financial, and health implications, and we recommend you speak to your legal, financial, and health advisors before acting on any of the information provided.

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