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March 04, 2022

Federal Judge Strikes Provisions of “No Surprises Act”

The “No Surprises Act” (“Act”) was enacted in December 2020 to address surprise medical bills. The Act limits what an insured patient must pay for emergency and certain non-emergency services furnished in an in-network facility by an out-of-network provider. In September 2021, the Departments of Health and Human Services, Labor, and the Treasury  issued an interim final rule creating a process for doctors and facilities to settle disputes with insurers over these out-of-network charges. The Texas Medical Association and a Tyler, Texas physician sued the agencies on the grounds that the rule exceeded the statutory mandates and was improperly issued without notice and comment required under the Administrative Procedures Act.

The Federal Judge in that lawsuit recently struck down various parts of that interim final rule.  The Court granted summary judgment for the plaintiffs, determining that the Act unambiguously establishes the framework for deciding any payment disputes, and certain provisions in the interim final rule directly conflict with the statutory text; the plaintiffs had standing to challenge the interim final rule; and that notice and comment were improperly bypassed. 

This court ruling struck down the challenged provisions for all providers throughout the country who may be subject to them.  However, the court ruling did not strike down any of the patient protections at this time.  While this case occurred in Texas, this decision will potentially have implications across the nation.