U.S. Supreme Court. (Sarahbeth Maney / New York Times)
In a thorough opinion written by Senior District Judge Richard Leon, the Court upheld the rule that was issued in October 2021 to establish an independent dispute resolution process, namely arbitration, of disputes between health plans and out-of-network providers over the providers’ bills. Ass’n of Air Med. Serv’s v. U.S. Dep’t of Health and Human Serv’s, No. 21-3031 (RJL), 2023 WL 5094881, at *1 & n.2 (D.D.C. Aug. 9, 2023).
The No Surprises Act was enacted on December 27, 2020. The Act’s purpose, you may recall, was “to end ‘surprise billing’ for patients and to remove them from the middle of payment disputes between the patient’s group health plan or issuer and providers.” Association of Air Medical Services, 2023 WL 5094881, at *1.
Out-of-network providers such as the plaintiff Association of Air Medical Services were understandably concerned with losing lucrative billings, whether their billings were paid for by patients or insurers. Out-of-network providers successfully challenged limitations on billing and arbitration of their charges in the Eastern District of Texas, where parts of the rules were vacated. The relevant agencies then rewrote and reissued the rules, including the arbitration rule challenged by the Association of Air Medical Services here.
Considering only the rewritten, reissued rule on arbitration that was before the Court, Senior District Judge Leon found “the defendants’ position to be eminently reasonable.” Association of Air Medical Services, 2023 WL 5094881, at *3. Judge Leon, an appointee of Pres. George W. Bush, has not always issued rulings favorable to the Government’s position, to say the least, but he did so here.
Judge Leon was satisfied as a judge in this case that the Government acted reasonably and in accordance with law, which is the test for whether the challenged Government action complied with the Administrative Procedure Act even if the judge’s own preferred reasoning might have been different from the Government’s reasoning. As to the arbitration rule before the Court in this No Surprises Act case, the Judge held: “That is the very type of well reasoned analysis the APA requires!” Association of Air Medical Services, 2023 WL 5094881, at *7 (emphasis by the Court).
In the meantime, in the Eastern District of Texas, an air ambulance service provider and other out-of-network providers have been busy obtaining decisions from a district judge appointed in 2018 which reject the same well reasoned analysis.
The apparent differences between the rulings may be resolved in the future.
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