Understanding the No Surprises Act: Coverage, Application, and Key Provisions

On December 27, 2020, the No Surprises Act became federal law in the United States. This legislation, a portion of the Consolidated Appropriations Act, aims to protect patients from unexpected and unreasonably high medical bills. Here’s what you need to know about this act, including its impact on your healthcare organization and team.

What Is the No Surprises Act?

So, what is the No Surprises Act? Who does the act apply to? This act was designed to prevent patients from incurring charges when they unknowingly receive care from out-of-network providers. It applies to anyone receiving healthcare services in the United States. 

Senators Maggie Hassan from New Hampshire and Bill Cassidy from Louisiana led the effort to include this section in the Consolidated Appropriations Act. They worked toward a solution as concerns grew over how many people faced excessive fees for medical care that they believed their insurance provider covered. 

The No Surprises Act, established in 2020, became effective on January 1, 2022. Following its inception, various government and private organizations developed resources, including hotlines and websites, providing healthcare patients with ready access to transparent billing information. These resources also provide a straightforward way for consumers to file complaints.

Key Provisions of the No Surprises Act

One of the first questions you might ask is, “What does the No Surprises Act cover?” Below is a rundown of what the key provisions include:

A Ban on Surprise Billing for Emergency Services

This ban applies to in-network and out-of-network services. It requires emergency services to be provided at in-network prices, regardless of provider status with a particular insurer. This ban also prohibits the need for out-of-network patients to get prior authorization.

A Ban on Balance Billing for Out-of-Network Cost-Sharing

Balance billing must not exceed the in-network cost of the services provided, applying to emergency services and select non-emergency services. The act requires co-insurance and deductibles to mimic in-network provider rates.

A Ban on Out-of-Network Fees and Balance Billing for Ancillary Care

This ban applies to services that out-of-network providers deliver when working out of in-network facilities. This can include specialists such as surgeons or anesthesiologists.

A Ban on Some Out-of-Network Charges and Balance Billing

Unless there is advance notice, facilities cannot bill for specific charges. In this instance, the facility must present patients with an easy-to-read consumer notice that states how the patient must give consent. Only once the patient approves these charges can the provider bill for them.

A Requirement for Transparent Documentation

If a patient doesn’t have insurance, they must receive transparent documentation stating the cost of the care. The facility must provide this documentation before offering any treatment. 

What Is a Surprise Medical Bill?

Also called a “balance bill,” a surprise medical bill is a healthcare bill that is unexpected and frequently large. A balance bill occurs when a healthcare provider not in the patient’s insurance network provides out-of-network services without notifying the patient and then bills them at the out-of-network price. The most frequent cases occur when a care recipient goes to an in-network facility, such as a hospital or clinic. The attending provider is an out-of-network professional — perhaps a surgeon or anesthesiologist.

Consider this scenario before the No Surprises Act: A patient falls and breaks their arm, so they go to the nearest emergency department for treatment. A radiology technician who contracts with the hospital takes the radiographs. The orthopedic surgeon — who also works for the hospital on a contract basis — is assigned to the patient and assesses and sets the fracture. When the patient’s bill arrives, it contains co-pay charges and separate fees for the radiology technician and orthopedist, with the latter two billed at an out-of-network rate despite working in an in-network hospital. 

In this case, the patient had no choice but to see these providers and was unaware of the healthcare professionals’ out-of-network status.

Before the No Surprises Act, it was not uncommon for patients to receive bills for the difference between what their insurance covered and what the out-of-network service charged. Often, these charges were substantial and could result in unexpected bills for patients. This unfair billing structure is now outlawed under the No Surprises Act.

Why Healthcare Pricing Transparency Matters

Before the No Surprises Act, healthcare pricing transparency was largely at the discretion of healthcare facilities and their practitioners. If a patient didn’t know to ask, they could find themselves footing unexpected charges they couldn’t afford to cover.

So, what are the benefits of price transparency? They can include:

• A reduction in healthcare costs

• Better decision-making on the part of the patient

• More consistent market pricing across the board

• Cost controls and budget planning

Transparency helps patients avoid unexpectedly high charges, but it benefits providers, as well. Healthy cost competition creates a more level playing field, making quality care available to a broader consumer base. 

Disclosure Requirements Under the No Surprises Act

The No Surprises Act requires that facilities and providers allow access to specific pricing information. This includes:

Machine-Readable Files

The public must have access to machine-readable files. These files need to include the pricing for all standard services and items, and they should undergo regular reviews and updates to ensure accurate information.

Cost Estimates

Before starting a treatment or service, a provider must give patients a Good Faith Estimate. This estimate needs to include the total expected cost of the treatments and services, along with a breakdown of the patient’s portion of the bill and what their insurance will cover.

Itemized Bills

Patients should also get itemized bills showing the cost of each treatment or service.

Where Can Patients and Providers Learn More?

There are numerous resources available to consumers and providers. Some are geared toward patients, while others are more focused on helping providers navigate the intricacies of the No Surprises Act. 

You and your patients can learn more through the following resources:

• Insurance companies

• Government agencies

• State-run publications

• Patient advocates

• Government hotlines

• Healthcare providers

• Online forums

How TempDev Can Help

Regardless of the size of your practice, TempDev can help you provide your patients with the information they need to make informed decisions. Our years of experience allow us to build tools that help you comply with the No Surprises Act and become a trusted resource for your patients. If you’d like to learn more about how we can help, call us at 1-888-TEMPDEV or send a message to our team.