In late January 2023, the relating to the No Surprises Act (NSA). In the suit, TMA challenged two items related to the NSA and its implementation:

  1. The increase in the IDR administrative fee for 2023 from $50 to $350.
  2. One requirement included in the batching rules for IDR. 

The ruling

On August 3rd, a federal court in Texas agreed with the TMA lawsuit and vacated the offending portions of the batching rule in the September, 2021 IFR, and the fee increase in the December, 2022 Guidance. The TMA 4 decision means the increase in administrative fees from $50 to $350 has been vacated, and the $50 administrative fee is in effect from August 4th onward. The court did not order the refund of any $350 fees paid between January 1 and August 3, 2023. Additionally, this decision does not impact the Certified IDRE fees charged by the Independent Dispute Resolution Entity (IDRE), which remain between $200 and $700 for single determinations, and slightly more for batched determinations.

The TMA also challenged one portion of the batching rules established in the September 2021 IFR that only permitted batching items with “the same service code.”  The TMA argued that the September 2021 IFR requirement was too narrow and improperly prohibited the batching of similar items as allowed by the NSA.  The court agreed with TMA and vacated the portion of the September, 2021 IFR that only permits batching for items with the same service code.

The administration has up to 60 days to decide whether to appeal this ruling to the Fifth Circuit, as it did with TMA 1 and TMA 2.

ĤƵ expects updated guidance

ĤƵ expects a more substantive response from the administration with timelines to update the industry on how batching of items for IDR should be handled going forward.  We may also see a formal notice and comment process to address the batching criteria, but that process takes several months at minimum. 

Administration’s reaction to TMA 4

The administration temporarily took down the IDR portal and suspended action by IDREs in reaction to the TMA 4 decision. However, they quickly restored the IDR portal and provided additional clarity in a message sent directly to impacted parties:

“Effective August 7, 2023, the Departments have directed certified IDR entities to resume processing single and bundled disputes where the administrative fees have been collected (or the deadline for collecting fees expired) before August 3, 2023. Additionally, the Departments have directed certified IDR entities to resume processing batched disputes where the IDR entity determined that the batched dispute was eligible and collected administrative fees (or the deadline for collecting fees expired) before August 3, 2023. Processing of other disputes remains temporarily suspended.”

IDREs may resume work on disputes that were initiated and/or determined eligible up to August 3, the date of the TMA 4 decision.

Prior TMA lawsuits

The Texas Medical Association prevailed in its first two lawsuits, which both related to the treatment of the QPA as the primary factor for consideration by the IDR Entity. TMA 1 has been voluntarily dismissed because the Final Rule addressed the items in dispute. The administration has appealed TMA 2 to the Fifth Circuit and is awaiting further action by the appellate court. 

TMA 3, which challenges multiple items in the July, 2021 IFR, including how QPA should be calculated; required disclosures by plans to providers. The prohibition of providers from challenging how plan calculates QPA is still pending an initial ruling on motions for summary judgment.