The No Surprises Act is designed to protect commercially insured patients from
surprise bills, including those enrolled in individual, group fully funded, and group
self-funded plans. The law does this by prohibiting providers from billing patients
for more than in-network cost-sharing amounts for most out-of-network care that
previously led to surprise bills and requiring insurers to classify such care as innetwork when determining a patient’s financial obligations.
Services that cannot be balance billed
The law protects patients from receiving surprise bills under most scenarios in
which surprise billing generally occurs:
- All out-of-network emergency care, including certain post-stabilization care
- Ancillary services delivered by an out-of-network provider at an in-network
facility related to anesthesiology, emergency care, laboratory, neonatology,
pathology, and radiology, as well as services provided by assistant surgeons,
hospitalists, and intensivists
- Out-of-network air ambulance transportation that would have been covered if
the air ambulance was in-network
- Non-emergency care delivered by an out-of-network provider at an in-network
facility without obtaining patient consent 72 hours in advance
Services that can be balance billed
The law includes a notable exception for ground ambulance transportation:
patients who are transported to a facility by an out-of-network ground ambulance
can still receive a balance bill from the ambulance provider. One study based on
data from a large national insurance plan estimated 79% of ground ambulances
providers used for emergencies were out-of-network.
The law also outlines specific criteria that, if met, permits certain out-of-network providers to balance bill patients for non-emergency services.
However, this does not apply to the ancillary services listed on the previous
Eligible out-of-network providers may balance bill if the patient consents to
receiving the care. To obtain consent, the provider must give the patient a
written notice at least 72 hours before the date of service clearly explaining
that the provider is out-of-network, consent is optional, and the patient can
choose to seek care from an in-network provider, as well as any information
on prior authorization. In addition, the notice must include an estimate of the
amount the patient would be charged. The patient must sign and date the
Payment for services that cannot be balance billed
Beyond eliminating most balance billing, the law also aims to keep patients
out of payment disputes by creating a new process for insurers and providers
to reach an agreement on the final payment amount for out-of-network care.
The new approach can stretch up to several months.
The law requires insurers to make an initial payment or submit a denial of
payment to the provider within 30 days of the service. The law does not set a
minimum payment amount and sunsets the Affordable Care Act’s so-called
“greatest of three” rule (The greatest of three rule refers to the minimum floor set for what health plans must pay for
out-of-network emergency care).
Independent dispute resolution and arbitration processes
At this point, either the out-of-network provider or the insurer can trigger a new
independent dispute resolution (IDR), which begins with a 30-day open
negotiation period. If the parties do not reach a payment agreement, either one
can initiate the law’s formal arbitration process. Providers and insurers also have
the option to combine several payment disputes into one arbitration proceeding.
The process gives both parties three days to select a certified, third-party
arbitrator; if they do not, HHS will appoint one within six days. Once an arbitrator
is chosen, the provider and insurer each have 10 days to submit a final payment
offer, as well as any additional information for the arbitrator to review. The
arbitrator then has 30 days to select one of the two offers. When making these
decisions, the law encourages arbitrators to consider several factors, including:
- The insurer’s 2019 median in-network rate for similar services in that
geographic area, adjusted based on inflation
- Demonstrations of good faith efforts to reach an agreement
- Contracted rates between the insurer and provider for the previous four years
- Both parties’ market share
- Patient acuity
- The provider’s level of training, experience, and quality, or the facility’s
teaching status, case mix, and scope of services
Arbitrators are not allowed to consider the provider’s billed charges, Medicare
rates, or Medicaid rates. Once the arbitrator selects the final payment amount,
the insurer has 30 days to make the payment, and the losing party must pay the
administrative costs for the arbitration process.