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Surprise! A Cautionary Tale for Out-Of-Network Billing: The No Surprises Act and the Impact on Healthcare Providers

Client Alert
February 25, 2021

SURPRISE! Congress passed The No Surprises Act at the end of 2020. Providers, particularly those billing as out-of-network providers, should start thinking about strategies to comply with this new law, set to take effect on January 1, 2022. 

In its most basic sense, the new law prohibits providers from billing patients for more than the in-network cost-sharing amount in most situations where surprise bills happen. It specifically applies to non-government payers and the amounts will be set through a process described in the new law. In particular, the established in-network cost-sharing amount must be billed for the following services:

  1. Out-of-network emergency facility and professional services;
  2. Post-stabilization care at out-of-network facilities until the patient can be safely transferred to another facility;
  3. Air ambulance transports;
  4. Out-of-network services delivered at or ordered from an in-network facility unless the provider complies with the notice and consent process set forth in the new law.

In addition to the limitation on what can be billed to patients by out-of-network providers, the following is a list of other key provisions in The No Surprises Act of which out-of-network providers should be particularly aware:

  1. Providers may not hold patients liable for higher amounts or denying treatment to out-of-network patients for emergency services and certain non-emergency services.
  2. There is a required Independent Dispute Resolution (“IDR”) process that insurers and providers will be required to follow in order to settle billing disputes.
  3. For permissible balance billing, providers must comply with the prescribed notice and consent process within 72 hours of the item or service to be provided.
  4. Providers must share good faith estimates of the total expected charges for scheduled items or services, with either the insurer or patient, when the items or services are scheduled at least three days in advance or when requested by the patient.
  5. All health care providers must make publicly available information on patient’s rights with respect to balance billing. Providers will need to make this notice available on their websites too.

Providers should understand that the Act permits states to require providers to adhere to these provisions and enforce compliance. Even if your state does not enforce compliance, the HHS Secretary is able to issue civil penalties up to $10,000 per violation.

Future Updates

By July 1, 2021 the Secretaries of HHS, Labor and Treasury must issue regulations regarding the qualifying cost-sharing amounts. The Secretary of HHS must also issue further guidance regarding the notice and consent process by July 1, 2021.

As of now, the IDR process will be effective January 1, 2022; however, the Secretaries of HHS, Labor and Treasury may change the process and issue the final regulations by December 27, 2021.

Stay tuned as regulations are finalized and more information becomes available.

If you are interested in learning more about The No Surprises Act, policies and forms you can use to comply with The No Surprises Act, or out-of-network billing in general, please contact Healthcare and Hospital Law Member Jeana M. Singleton at jmsingleton@bmdllc.com or 330-253-2001, or any member of the BMD Healthcare and Hospital Law group.

Healthcare LawHospital LawJeana Singletonpatient billingHealthcare Providers
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