For uninsured and self-paying individuals: Good Faith Estimates (GFE)

On September 30, 2021, the Departments of Health and Human Services (HHS), Labor, and the Treasury, alongside the Office of Personnel Management (OPM), issued a new Interim Final Rule (IFR) to implement components of the No Surprises Act (NSA). The IFR spelled out components of the Good Faith Estimate, which is now required for uninsured or self-pay individuals, and is expected to extend to insured patients next year.

Good Faith Estimates

The goal of the NSA is to provide patients with enough information to make pricing decisions. The Good Faith Estimate provision of the NSA is designed to give self-paying consumers predictability in the amount they will be charged for the healthcare services they that they are considering or scheduled to receive, prior to an appointment. They have the right to receive a Good Faith Estimate for the total expected cost of any non-emergency items or services, including doctor’s fees, medical tests, prescription drugs, equipment, and hospital fees.

As of January 1, 2022, the act requires all state-licensed or certified healthcare providers to ask at the time a service is scheduled about a patient’s coverage status, i.e., if an individual is privately insured, and, if so, whether they intend to use their insurance for the scheduled care. Providers must then inform all new and continuing clients who are either uninsured, or not planning to submit insurance claims for the healthcare services they seek, of their right to receive Good Faith Estimates, and within a few days give self-pay patients Good Faith Estimates for the cost of their health care. The GFE must be given to the patient before the individual agrees to receive the item or service, so consumers are able to compare costs and decide whether to self-pay or use insurance.

This statutory transparency requirement goes beyond disclosure of the provider or facility’s own expected charges. The Good Faith Estimate must also include the expected charges for other providers or facilities that are reasonably expected to provide items or services in conjunction with the scheduled item or service.

Eligibility to receive a Good Faith Estimate

At this time, a Good Faith Estimate is not necessary for a client or patient who is planning to use insurance benefits to cover services. Therefore, the GFE provisions do not apply if the client is a participant in Medicare, Medicaid, or other federal healthcare programs. According to the Centers for Medicare and Medicaid (CMS), people with insurance can also ask for an estimate, which will normally be provided to the requestor’s insurance plan.

If the individual has health insurance, the provider or facility must notify the plan or insurer of an estimate of expected charges. This information will then be used by the plan or insurer to prepare an “advanced” explanation of benefits (EOB) that will then be sent to the patient. If the individual is uninsured (or self-pay, meaning they will not use their insurance), they will receive the good faith estimate directly from the provider or facility.

According to the NSA, short-term limited duration insurance coverage is not individual health insurance coverage. As such, for purposes of the GFE and the patient/provider dispute resolution process, those enrolled in only short-term limited duration insurance are treated as uninsured or self-pay individuals. The same is true for other types of non-ACA products that are not regulated as individual health insurance coverage, such as excepted benefits and health care sharing ministries.

A Good Faith Estimate is not required to account for unanticipated care that is not reasonably expected or that results from unforeseen events. Good Faith Estimates are not generally required for urgent or emergency services, which by their nature cannot be scheduled in advance. However, a provider or facility must provide a Good Faith Estimate to a patient for an urgent care appointment scheduled at least 3 days in advance.

What Is Included in the Good Faith Estimate?

HHS directs providers and facilities to provide a single, comprehensive good faith estimate to patients, rather than separate good faith estimates from each provider or facility involved in the care. Items and services include any care that is reasonably expected to be provided in conjunction with the scheduled or requested care and must reflect charges from all providers and facilities who are reasonably expected to provide care to the patient.

The Good Faith Estimate must be in writing, in language that is clear and understandable to the patient. The GFE becomes part of a patient’s medical record. Providers and facilities must retain and be able to give the patient a copy of any previously issued Good Faith Estimate from the prior six years.

The Good Faith Estimate must include all of the following:

• Client name and date of birth
• Description of the primary item or services that will be provided, and, if applicable, the scheduled date
• Diagnostic or service codes
• Expected charges associated with each of those goods or services
• Provider name, National Provider Identifier (NPI), and tax ID number (TIN)
• Location(s) where services will be provided
• Beginning in 2023, a list of items and services and their associated costs, related to the treatment being sought, that are reasonably expected to be given by another provider or facility involved in the patient’s care (a co-provider or co-facility). The list of services to be provided should differentiate between those services that the convening provider will be offering, and those offered through co-providers and co-facilities.
• Disclaimers, which must include:
  • The client has the right to engage in the Patient/Provider Dispute Resolution (PPDR) Process if the actual costs of services significantly exceed those listed in the Good Faith Estimate.
  • The Good Faith Estimate does not obligate or require the client to obtain any of the listed services from the provider.
  • The information provided in the Good Faith Estimate is only an estimate, as actual items, services, or charges may differ based on the course of treatment.
• Disclaimers, which may include:
  • The provider may recommend additional items or services as part of the treatment that are not reflected in the estimate and that will require separate scheduling and a separate Good Faith Estimate.

Items And Services

The Good Faith Estimate applies to the “primary item or service”, i.e., the initial reason for the visit, as well as all other items or services that are reasonably expected to be provided with the scheduled care by all providers and facilities. This includes any related services such as facility use, telehealth, imaging and lab services, and pre- or post-operative services not scheduled separately by the patient. Each Good Faith Estimate must cover a defined period of care (e.g., from admission through discharge) and include expected charges for care from all physicians, facilities, or providers.

HHS gives knee surgery as an example. A Good Faith Estimate for knee surgery would include an itemized list of items and services related to the actual surgery: physician professional fees, assistant surgeon professional fees, anesthesiologist professional fees, facility fees, prescription drugs, and durable medical equipment fees, from admission through discharge. The GFE would not include separately scheduled care, such as physical therapy, lab tests, or a separately scheduled post-operative follow-up visit after discharge. These would have their own Good Faith Estimates.

Expected Charge

The expected charge is the cash pay rate, the rate for uninsured/self-pay individuals, including any discounts or adjustments, or the amount that would have been charged to a plan or insurer if the patient were insured. The Good Faith Estimate can reflect gross charges or chargemaster rates if that is the amount the patient is expected to pay. But those amounts must be reduced by any expected discounts or adjustments, such as a hospital’s financial assistance policy.

In some practice areas, such as psychological care, the healthcare provider may not know how much treatment is necessary for new clients. A range of costs is acceptable. If a range is used, the factors that can result in the lower or higher range should be identified. For example, a psychiatrist may state that between 10 and 25 50-minute sessions are needed each year. Given a charge of $x per session, the possible costs range between 10x and 25x.

Timing of the Good Faith Estimate

The Good Faith Estimate is supposed to enable consumers to compare costs to be able to decide whether to self-pay or use insurance. Therefore, the GFE requirement is triggered when a patient schedules health care services or requests cost information, even without scheduling care. Essentially, any discussion, inquiry, or conversation about the costs of medical care is a request for a Good Faith Estimate.

The NSA requires that the Good Faith Estimate be provided according to the following deadlines:

• If a service is scheduled at least 10 business days in advance, the Good Faith Estimate must be provided within 3 business days of the scheduling.
• If a service is scheduled at least 3 business days in advance, the Good Faith Estimate must be provided within 1 business day of scheduling.
• If a service is scheduled less than 3 business days in advance, a Good Faith Estimate is not required.
• If an individual requests a Good Faith Estimate, it must be provided within 3 business days.
• Clients who receive long-term or ongoing services should receive the Good Faith Estimate every 12 months.

Corrections and Changes to the Good Faith Estimate

The Good Faith Estimate can be revised after an initial session with a new client. After that, the provider should be better able to understand the patient’s symptoms, diagnosis, and the severity of the disorder, and would then be able to include more information such as diagnostic codes.

Between the preparation of the Good Faith Estimate and the date of service, there also may be changes impacting the Estimate, including the expected charges, items, services, frequency, recurrences, duration, or providers. Some errors or omissions may arise because a provider’s Good Faith Estimate information is developed in reliance on inaccurate or incomplete information from another entity or individual. In circumstances where a provider becomes aware of an error or omission in a good faith estimate, the provider is obligated to correct the information as soon as practicable.

Convening Providers/Facilities Versus Co-Providers/Facilities

The Good Faith Estimate must reflect all expected charges in a single disclosure, rather than separate good faith estimates from each provider or facility involved in the care. One entity, the “convening” healthcare provider or healthcare facility, must be responsible for collecting and delivering this information to the uninsured or self-pay individual. A convening provider is defined as the provider who schedules the primary item or service, or who receives the initial request for a Good Faith Estimate from an uninsured or self-paying patient. A co-provider or co-facility furnishes items or services customarily provided in conjunction with a primary item or service.

Convening providers are responsible for determining if individuals are uninsured or self-pay patients, providing notice of the availability of a Good Faith Estimate, contacting co-providers to collect estimate information about their expected charges, and preparing and providing a single the Good Faith Estimate which consolidates this information. Co-providers, on the other hand, must respond to the convening provider’s request for estimate information.

Enforcement

Providers that fail to comply with the Good Faith Estimate requirements may be subject to state regulatory enforcement actions or federal civil monetary penalties, i.e. fines for noncompliance. Federal agencies have delayed enforcement of the good faith estimate requirement for insured, non-self-pay patients until new data transfer standards can be adopted.

Click here for part 4 of this series.