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GAO reviewed the Office of Personnel Management (OPM); Department of the Treasury, Internal Revenue Service; Department of Labor, Employee Benefits Security Administration; and Department of Health and Human Services' (HHS) (collectively, the agencies) new rule entitled "Requirements Related to Surprise Billing; Part II." GAO found that the interim final rules (1) implement provisions of the No Surprises Act that provide for a federal independent dispute resolution process to permit group health plans and health insurance issuers offering group or individual health insurance coverage and nonparticipating providers, facilities, and providers of air ambulance services to determine the out-of-network rate for items and services that are emergency services, nonemergency services furnished by nonparticipating providers at participating facilities, and air ambulance services furnished by nonparticipating providers of air ambulance services, under certain circumstances; (2) clarify how certain No Surprises Act provisions apply to health benefits plans offered by carriers under the Federal Employees Health Benefits Act; and (3) address good faith estimates of health care items and services for uninsured or self-pay individuals and the associated patient-provider dispute resolutions process.

Enclosed is our assessment of the agencies' compliance with the procedural steps required by section 801(a)(1)(B)(i) through (iv) of title 5 with respect to the rule. If you have any questions about this report or wish to contact GAO officials responsible for the evaluation work relating to the subject matter of the rule, please contact Shari Brewster, Assistant General Counsel, at (202) 512-6398.





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B-333648

October 21, 2021

The Honorable Ron Wyden
Chairman
The Honorable Mike Crapo
Ranking Member
Committee on Finance
United States Senate

The Honorable Richard Neal
Chairman
The Honorable Kevin Brady
Ranking Member
Committee on Ways and Means
House of Representatives

Subject:  Office of Personnel Management; Department of the Treasury, Internal Revenue Service; Department of Labor, Employee Benefits Security Administration; Department of Health and Human Services:  Requirements Related to Surprise Billing; Part II

Pursuant to section 801(a)(2)(A) of title 5, United States Code, this is our report on a major rule promulgated by the Office of Personnel Management (OPM); Department of the Treasury, Internal Revenue Service; Department of Labor, Employee Benefits Security Administration; and Department of Health and Human Services (HHS) (collectively, the agencies) entitled ?Requirements Related to Surprise Billing; Part II? (RINs:  3206-AO29; 1545-BQ05; 1210-AC00; 0938-AU62).  We received the rule on October 4, 2021.  It was published in the Federal Register as interim final rules with request for comments on October 7, 2021.  86 Fed. Reg. 55980.  The effective date is October 7, 2021.

The agencies stated that the interim final rules implement provisions of the No Surprises Act, Pub. L. No. 116-260, div. BB, title I, 134 Stat 1182, 2757 (Dec. 27, 2020), that provide for a federal independent dispute resolution process to permit group health plans and health insurance issuers offering group or individual health insurance coverage and nonparticipating providers, facilities, and providers of air ambulance services to determine the out-of-network rate for items and services that are emergency services, nonemergency services furnished by nonparticipating providers at participating facilities, and air ambulance services furnished by nonparticipating providers of air ambulance services, under certain circumstances.  Also included, according to the agencies, are interim final rules issued by OPM to clarify how certain No Surprises Act, Pub. L. No. 116-260, 134 Stat. 2757, provisions apply to health benefits plans offered by carriers under the Federal Employees Health Benefits Act, Pub. L. No. 86-382, 73 Stat. 708 (Sept. 28, 1959).  Lastly, also included, according to the agencies, are interim final rules issued by HHS that address good faith estimates of health care items and services for uninsured or self-pay individuals and the associated patient-provider dispute resolutions process. 

The Congressional Review Act (CRA) requires a 60-day delay in the effective date of a major rule from the date of publication in the Federal Register or receipt of the rule by Congress, whichever is later.  5 U.S.C. § 801(a)(3)(A).  The 60-day delay in effective date can be waived, however, if the agency finds for good cause that delay is impracticable, unnecessary, or contrary to the public interest, and the agency incorporates a statement of the findings and its reasons in the rule issued.  5 U.S.C. § 808(2).  Here, the agencies determined that it would be impracticable and contrary to the public interest to delay the effective date of the interim final rules and that there is good cause to waive the delay in effective date under CRA.  In support of waiving the delay in the effective date the agencies stated that regulated entities need time to implement the requirements of the interim final rules.

Enclosed is our assessment of the agencies? compliance with the procedural steps required by section 801(a)(1)(B)(i) through (iv) of title 5 with respect to the rule.  If you have any questions about this report or wish to contact GAO officials responsible for the evaluation work relating to the subject matter of the rule, please contact Shari Brewster, Assistant General Counsel, at (202) 512-6398.
Shirley A. Jones
Managing Associate General Counsel

Enclosure

cc:  Carrie E. Mudd
  Director, Legal Processing Division
  Department of the Treasury

  Ali Khawar
  Acting Assistant Secretary
  Employee Benefits Security Administration
  Department of Labor

ENCLOSURE

REPORT UNDER 5 U.S.C. § 801(a)(2)(A) ON A MAJOR RULE
ISSUED BY THE
OFFICE OF PERSONNEL MANAGEMENT;
DEPARTMENT OF THE TREASURY, INTERNAL REVENUE SERVICE;
DEPARTMENT OF LABOR, EMPLOYEE BENEFITS SECURITY ADMINISTRATION;
DEPARTMENT OF HEALTH AND HUMAN SERVICES
ENTITLED
?REQUIREMENTS RELATED TO SURPRISE BILLING;
PART II?
(RINs:  3206-AO29; 1545-BQ05; 1210-AC00; 0938-AU62)

(i) Cost-benefit analysis

The Office of Personnel Management (OPM), Department of Treasury, Internal Revenue Service (Treasury), Department of Labor, Employee Benefits Security Administration (Labor), and Department of Health and Human Services (HHS) (collectively, the agencies) described the benefits and costs of the interim final rules.  The agencies estimated the interim final rules will impose incremental costs of approximately $760.95 million in the first year and $440.67 million in subsequent years.  In addition, the agencies stated that over 10 years, the associated costs will be approximately $3.62 billion with an annualized cost of $517.12 million, using a 7 percent discount rate.  The agencies also stated that the interim final rules will help ensure that consumers are protected from unexpected out-of-network medical costs by creating a process for plans, issuers, federal employee health benefit carriers and nonparticipating providers, facilities, and providers of air ambulance services to resolve disputes regarding out-of-network rates.  The agencies noted that the interim final rules provide a market-based approach that will allow these entities to agree upon reasonable payment rates. 

(ii) Agency actions relevant to the Regulatory Flexibility Act (RFA), 5 U.S.C. §§ 603-605, 607, and 609

The agencies stated the interim final rules are exempt from the RFA because they were not required to publish a notice of proposed rulemaking.

(iii) Agency actions relevant to sections 202-205 of the Unfunded Mandates Reform Act of 1995, 2 U.S.C. §§ 1532-1535

The agencies stated that section 202 of the Act does not apply to interim final rules or non-notice rules issued under the good cause exemption in 5 U.S.C. § 553(b)(B).  The agencies also stated that for purposes of the Act, the interim final rules do not include any federal mandate expected to result in expenditures by state, local or tribal governments of $100 million or more (adjusted annually for inflation with the base year 1995).

(iv) Other relevant information or requirements under acts and executive orders

Administrative Procedure Act, 5 U.S.C. §§ 551 et seq.

The agencies determined that it would be impracticable and contrary to the public interest to delay putting the provisions in the interim final rules in place until a full public notice and comment process has been completed and that there is good cause to waive the delay in effective date for certain provisions of the interim final rules.  In support of waiving the delay in the effective date the agencies stated that the independent dispute resolution and internal claims appeals and external review provisions generally apply for plan years beginning on or after January 1, 2022.  The agencies further stated that the provisions related to protections for the uninsured generally apply beginning on January 1, 2022.  According to the agencies, although this effective date may have allowed for the regulations, in promulgated with the full notice and comment rulemaking process, to be applicable in time for the applicability date of the provisions in the No Surprises Act, Pub. L. No. 116-260, div. BB, title I, 134 Stat 1182, 2757 (Dec. 27, 2020), this timeframe would not provide sufficient time for the regulated entities to implement the requirements. 

Paperwork Reduction Act (PRA), 44 U.S.C. §§ 3501-3520

The agencies stated that the interim final rules contain information collection requirements under PRA.  The agencies summarized the new and revised information collection requirements as follows:

·  HHS, Surprise Medical Billing: Independent Dispute Resolution, Office of Management and Budget (OMB) Control Number 0938-NEW; 4,826,970 estimated total annual burden hours; $751,688 estimated total annual burden cost;

·  Labor, Surprise Medical Billing: Independent Dispute Resolution, OMB Control Number 1210-NEW; 65,948 estimated total annual burden hours; $187,546 estimated total annual burden cost;

·  Treasury, Surprise Medical Billing: Independent Dispute Resolution, OMB Control Number 1545-NEW; 65,948 estimated total annual burden hours; $187,546 estimated total annual burden cost;

·  OPM, Surprise Medical Billing: Independent Dispute Resolution, OMB Control Number NEW; 13,190 estimated total annual burden hours; $37,509 estimated total annual burden cost;

·  Labor, Affordable Care Act Internal Claims and Appeals and External Review Procedures for Plans, OMB Control Number 1210-0144; 3,241 estimated total annual burden hours; $1,627,679 estimated total annual burden cost;

·  Treasury, Affordable Care Act Internal Claims and Appeals and External Review Procedures for Plans, OMB Control Number 1545-2182; 3,241 estimated total annual burden hours; $1,627,679 estimated total annual burden cost;

·  HHS, Affordable Care Act Internal Claims and Appeals and External Review Procedures for Plans, OMB Control Number 0938-1099; 3,066 estimated total annual burden hours; $241,850 estimated total annual burden cost.

Statutory authorization for the rule

The agencies promulgated the interim final rules pursuant to section 8913 of title 5, United States Code; sections 4069c and 4069c-1 of title 22, United States Code; section 7805 of title 26, United States Code; various sections of title 29, United States Code; various sections of title 42, United States Code; section 3516 of title 50, United States Code; Public Law 101-513; Public Law 104-106; Public Law 104-191; Public Law 105-33; Public Law 105-200; Public Law 105-261; Public Law 110-279; Public Law 110-343; Public Law 111-3; Public Law 111-148; Public Law 111-152; Public Law 113-235; Public Law 116-92; and Public Law 116-136.

Executive Order No. 12866 (Regulatory Planning and Review)

The agencies stated that OMB has determined that the interim final rules are economically significant under the Order.

Executive Order No. 13132 (Federalism)

The agencies determined the interim final rules have Federalism implications because it has direct effects on the states, the relationship between the national government and the states, or the distribution of power and responsibilities among various levels of government.  The agencies stated they attempted to balance the states? interests in regulating health insurance issuers, providers, and facilities with the need to ensure at least the minimum federal consumer protections in every state.  By doing so, the agencies stated they complied with the requirements of the Order.




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