CMS NSA Market Share Letter

Dear Deputy Administrator and Director Montz:

As the Centers for Medicare & Medicaid Services (CMS), working on behalf of the Department of Health and Human Services and together with the Departments of Labor and Treasury (collectively “the Departments”), continues to refine federal Independent Dispute Resolution (IDR) processes required under the No Surprises Act (NSA), the American Academy of Emergency Medicine (AAEM) offers the following additional input for consideration. AAEM is the specially society for board-certified emergency physicians, representing over 8,000 members across the nation.

The payment challenges and administrative burdens that out-of-network providers face in the current reimbursement landscape have led to drastic reductions in revenue for emergency group practices, whose business models must already withstand the mandates of EMTALA, insufficient Medicare and Medicaid reimbursement rates, and other financial pressures created by law. The losses that providers have been forced to absorb in this dynamic period have been substantial, and perhaps no specialty has been impacted more than emergency medicine, particularly those emergency practice groups that have remained independent and do not receive the financial backing and support of large corporations or private equity investors. Not all “independent groups” are similar. Some independent groups are backed by a large national contract management company, often involving private equity (“National CMG”). Other independent emergency medicine groups live up to the spirit of the term “independent group” and are not backed by National CMGs or private equity investors, but are instead physician owned and locally managed (“Local Independent Emergency Group”). Many of these Local Independent Emergency Groups are presently at risk of going out of business and will not be able to sustain the ongoing starvation of revenues much longer. Many, in fact, can already project, based on current trajectories, the precise year and month that they will be forced to exit their hospital contracts and shutter their operations.

While enabling payors to pay reduced rates for out-of-network emergency care provided to their members may at first glance appear to result in a lowering of healthcare costs, (1) the opposite result will be achieved if Local Independent Emergency Groups are driven to insolvency. What will be left standing will be National CMGs, which are generally able to extract higher payment rates from payers. We understand, of course, that CMS is continuing to work to achieve the balance of interests that Congress designed and enacted in the NSA, but as part of this effort, we urge CMS to establish affirmative protections for Local Independent Emergency Groups that will safeguard not only their interests, but the broader aims of cost-savings and value-based reimbursement underlying the NSA.

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