Biden-Harris Administration Issues Proposed Rules to Promote Transparency in Air Ambulance Costs, Agent and Broker Compensation

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WASHINGTON, D.C. — The U.S. Departments of Health and Human Services (HHS), Labor, and the Treasury (collectively, the Departments), along with the Office of Personnel Management (OPM), announced proposed rules that would require plans, issuers, and providers of air ambulance services to submit detailed data regarding air ambulance services specified in the reporting requirements of the No Surprises Act.

The rules additionally outline the Centers for Medicare & Medicaid Services’ (CMS) authority to fully enforce Title I (the No Surprises Act) and Title II (Transparency) of Division BB of the Consolidated Appropriations Act of 2021, in states that do not have the authority to enforce or fail to substantially enforce one or more of the provisions, and would help consumers understand the compensation being paid to agents and brokers who help them select health insurance. This is the latest regulatory action in a series of rulemaking implementing the No Surprises Act.

“The air ambulance industry is a highly consolidated market that often leads to surprise bills for patients,” said Health and Human Services Secretary Xavier Becerra. “[The] proposed rules are part of the Biden-Harris Administration’s agenda to protect patients from unreasonably high costs and make health care more affordable. These rules would allow HHS to collect data to analyze the industry’s market trends and costs and provide critical information that will address exorbitant air ambulance expenses.”

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The median cost for air ambulance transportation ranges from over $36,000 to $40,000. Air ambulance providers are not allowed to send surprise bills to Medicaid or Medicare patients. For patients with private insurance, however, an HHS Assistant Secretary of Planning and Evaluation (ASPE) report estimates that over 50 percent of air ambulance trips are out-of-network. This inherently results in surprise billing, although exactly how much of the cost is passed on to patients remains less clear.

The first rule in this series of rulemaking made clear that the No Surprises Act bans surprise bills for patients who use out-of-network air ambulance services and limits the amount they pay out-of-pocket starting next year.

Air ambulances are critical providers in the health care system, with known cost challenges associated with maintaining and running air ambulance services. The data collected on air ambulance services would shed light on the other unknown or less known costs associated with air ambulance services and would be used in a comprehensive, publicly-available HHS and Department of Transportation report to increase transparency and help inform future policy development aimed at addressing these costs.

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The proposed rules also detail the process that CMS would use to determine if states are substantially enforcing new surprise billing and other consumer protections. These proposed rules would ensure CMS can take action against providers and facilities to further protect consumers from surprise bills in states that fail to substantially enforce these requirements.

“No one should avoid seeking health care for fear of receiving a surprise medical bill,” said CMS Administrator Chiquita Brooks-LaSure. “The new consumer protections… are critical to shielding consumers from the devastating financial impacts that may occur as a result of an unlawful surprise bill, and CMS is committed to vigorous enforcement of these protections.”

The proposed rules also would further increase transparency by requiring certain health insurance issuers to inform consumers of how agents or brokers who assist consumers with enrollment in individual health insurance coverage and short-term, limited-duration insurance are compensated, including both direct and indirect compensation provided for such enrollment.

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View a fact sheet about the proposed rules.

Read the ASPE report on Air Ambulance and Surprise Billing.

View the proposed rules here.

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