Reed Smith Client Alerts

The same federal judge in Texas that granted health care providers’ challenge to Qualifying Payment Amount’s (QPA’s) presumptive weight earlier this year has granted a nearly identical challenge for air ambulance providers. In this alert, Reed Smith comments upon the decision and its potential impact on air ambulance independent dispute resolution (IDR).

In a previous client alert, the Reed Smith team detailed how Judge Jeremy D. Kernodle of the U.S. District Court for the Eastern District of Texas invalidated the so-called “QPA presumption” as applied to most health care providers. See Tex. Med. Assoc. v. United States HHS, No. 6:21-cv-425-JDK, 2022 U.S. Dist. LEXIS 31807, at *1 (E.D. Tex. Feb. 23, 2022). This week, Judge Kernodle made a nearly identical ruling as applied to air ambulance providers. As a result, the QPA presumption and associated agency guidance no longer apply to air ambulance providers.

Going forward, air ambulance IDRs will continue, albeit without the QPA presumption. Judge Kernodle noted that vacatur would “not be unduly disruptive” because “the remaining provisions of the Rule and the Act itself provide a sufficient framework for all interested parties to resolve payment disputes. “LifeNet, Inc.. v. United States HHS, No. 6:22-cv-162-JDK, 2022 U.S. Dist. LEXIS 132693, at *17 (E.D. Tex. July 26, 2022).” IDR entities may turn to the existing CMS guidance for non-air ambulance providers, for which there is no QPA presumption per the Texas Medical decision, for a framework to determine the winning offer in air ambulance IDRs.

As of this publication, CMS has yet to address the LifeNet ruling. However, it has written final rules implementing the IDR provisions of the No Surprises Act that reportedly address the issues in the Texas Medical decision. The final rules are currently under OMB review and pending publication. It is possible that these final rules already remove the QPA presumption for air ambulance in anticipation of this decision. The authors are closely monitoring these issues and are available to answer any questions as the situation evolves.

Client Alert 2022-198