US appeals court voids formula used to avert surprise medical bills

Tuesday's majority sided with the providers in finding it improper for the QPA to include "ghost rates," or rates for services they never provided, and exclude bonus and incentive payments.

It also sided with the government in letting insurers exclude one-off agreements for services such as air ambulances from "contracted rates" used to calculate the QPA.

The majority rejected warnings by the government and insurers that vacating the formula could leave patients on the hook for sky-high medical bills.

"Indeed, the agencies have been exercising enforcement discretion while their appeal from the district court has been pending, so they are more than capable of preventing immediate chaos," the majority said.

A federal appeals court on Tuesday struck down a formula used by healthcare providers, insurers and the government that is designed to shield patients from staggeringly high "surprise" medical bills.