The No Surprises Act (the “NSA”) has generated (and will continue to generate) a significant amount of litigation. The Plaintiffs, who are primarily medical provider organizations, used the practice of forum shopping to bring their cases in the court that will treat them most favorably — the United States District Court for the Eastern District of Texas. The primary and most influential cases are being presided over by Judge Jeremy Kernodle. Prior to being confirmed, he was a partner at Haynes and Boone, LLP where he focused on representing healthcare providers in Federal courts throughout the country.

Below is a running summary of the key NSA litigation:

February 6, 2023: Texas Medical Association, et al. v. U.S. Department of Health and Human Services, et al., U.S. District Court for the Eastern District of Texas Case No. 6:22-cv-372

The Court entered a final judgment that vacated certain provisions of Requirements Related to Surprise Billing: Final Rules because it improperly restricted arbitrators’ discretion and unlawfully “titl[ed]” it in favor of the Qualifying Payment Amount (“QPA”). The Court found that the Final Rules improperly required the arbitrators to consider the QPA first and then the remaining factors and required the IDR Entities to presume the credibility of the QPA, but not the other factors. The Court then vacated additional provisions. A copy of the Amended Part II with the vacated provisions struck out can be found here. The vacated provisions can be found starting on page 28.

HHS appealed this case on April 18, 2023 and the appeal is pending before the Fifth Circuit Court of Appeals. The appeal is in its early stages.

January 30, 2023: Texas Medical Association, et al. v. U.S. Department of Health and Human Services, et al., U.S. District Court for the Eastern District of Texas Case No. 6:23-cv-00059

In this litigation, Texas Medical Association challenges the sevenfold increase in the nonrefundable administrative fee (from $50 to $350) that each party must pay to the government to participate in the IDR (arbitration) process.

The Complaint can be found here. The parties filed cross-motions for summary judgment. The Court has not issued a decision.

November 30, 2022: Texas Medical Association, et al. v. U.S. Department of Health and Human Services, et al., U.S. District Court for the Eastern District of Texas Case No. 6:22-cv-450

Texas Medical Association filed a lawsuit asserting that Requirements Related to Surprise Billing; Part I (“Part I”) materially deviated from the No Surprises Act “by issuing a methodology for calculating QPAs that artificially deflates [] insurer-calculated metrics.” TMA is attacking the method of calculating QPAs set forth in Part I TMA lists four ways that Part I drives down QPAs and results in under-reimbursement to healthcare providers:

• Part I tells insurers to include rates in their QPA calculations that the NSA requires them to exclude (so called “ghost rates”).
• Part I instructs insurers to separately calculate rates by specialty “only where the [insurer] otherwise varies its contracted rates based on provider specialty” whereas the NSA requires insurers always to calculate QPAs bsed on rates of providers “in the same or similar specialty.”
• Part I requires insurers to use include “risk sharing, bonus, penalty, or other incentive-based or retrospective payments or payment adjustments” in calculating the contracted rate, whereas the NSA provides that the contracted rate used in a QPA calculation is “the total maximum payment … under such plans or coverage.”
• Part I permits group health plans to allow TPAs to determine the QPA by using the contracted rates recognized by all its self-insured group health plans it administers, whereas the NSA requires that each plan only use its own contracted rates when calculating QPAs.

The Complaint can be found here. The parties filed cross-motions for summary judgment. The Court has not issued a decision.

February 23, 2022: Texas Medical Association, et al. v. U.S. Department of Health and Human Services, et al., U.S. District Court for the Eastern District of Texas Case No. 6:21-cv-00425

The Court entered a final judgment that eliminated the rebuttable presumption that the qualifying payment amount is the appropriate out-of-network rate. The original Requirements Related to Surprise Billing; Part II can be found here with the provisions vacated by the Court struck out. The vacated provisions can be found on pages 372, 383-388, 416, 427-432, 462, and 472-478.

This case was appealed to the Fifth Circuit Court of Appeals. The appeals case was voluntarily dismissed on October 24, 2022.