Colorado IDR Arbitration For Medical Revenue Recovery

Colorado Surprise Billing Law (SBL)

The Colorado Surprise Billing Law (SBL) took effect on January 1, 2020, and includes the following key provisions:

• Arbitration Process:
  • The law establishes a 90-day arbitration process for resolving disputes between insurers and providers.
• Reimbursement Guidelines:
  • Reimbursement for out-of-network (OON) services is based on the median in-network (INN) rates and the All-Payor Health Claims Database (APCD).
  • These databases often incorporate Medicare and Medicaid rates, leading to relatively low reimbursement levels under the SBL framework.
  • Refer to Colorado Revised Statutes (C.R.S.) § 10-16-704 for details.

Coordination Between State and Federal Processes

The Centers for Medicare & Medicaid Services (CMS) has clarified the interplay between Colorado's state laws and federal regulations regarding OON rates:

1. State Law Application:
   • Colorado does not have an All-Payor Model Agreement to establish OON rates.
   • CMS acknowledges that specific Colorado statutes, including C.R.S. § 10-16-704(3)(d)(II), § 10-16-704(5.5), and § 10-16-704(15), will determine OON rates for:
     • Services provided to insured individuals by nonparticipating providers.
     • Nonparticipating emergency facilities under insured group health plans or individual insurance coverage.
2. Federal Dispute Resolution:
   • For air ambulance services, the federal Independent Dispute Resolution (IDR) process applies, as outlined in section 2799A-2(b) of the Public Health Service Act and 45 CFR 149.520.
   • CMS will enforce the outcomes of the federal IDR process for air ambulance service disputes in Colorado.

Additional CMS Insights

In a letter to the Governor of Colorado dated January 18, 2022, CMS outlined its understanding of the bifurcated approach:

• State laws govern most OON reimbursement disputes within the parameters of insured group plans and individual coverage.
• Federal processes specifically apply to air ambulance services.

This dual framework ensures that disputes are resolved within the appropriate jurisdiction while aligning with both state and federal guidelines.