Surprise medical bills destroyed lives. Patients went to in-network hospitals and received care they thought insurance would cover. Weeks later, bills arrived for tens of thousands of dollars. Out-of-network doctors they never met, never chose, and never even knew existed sent massive bills demanding payment. These surprise bills came from anesthesiologists, assistant surgeons, radiologists, pathologists, and emergency physicians. Patients had no warning, no choice, and no way to avoid the charges.
Insurance paid their usual out-of-network rates, which were low. The providers billed patients for the balance. A procedure that should have cost a patient their normal copay turned into a $30,000 debt. Families went bankrupt. Credit was destroyed. Medical debt became the leading cause of personal bankruptcy in America. Patients who did everything right, who verified coverage and used in-network facilities, still got financially devastated.
This happened for decades. States tried to address it with varying laws. Some states banned balance billing in certain situations. Other states did nothing. Patients in protective states had some safety. Patients in other states remained vulnerable. The problem needed a federal solution that protected everyone everywhere.
The No Surprises Act became federal law on January 1, 2022. This legislation protects patients from surprise medical bills in most situations. It changes how providers can bill patients. It creates new dispute resolution processes for payment disagreements. It requires price transparency. The law fundamentally altered medical billing practices, especially for out-of-network providers and certain specialties.
Understanding the No Surprises Act is required for medical practices, billing staff, and healthcare administrators. The law creates new rules about what patients can be billed, when balance billing is prohibited, how payment disputes are resolved, and what documentation is required. Violations carry significant penalties. This guide explains what the No Surprises Act is, who it protects, when it applies, how it changes billing practices, what the dispute resolution process involves, and how practices must comply.
What the No Surprises Act Is
The No Surprises Act is federal legislation protecting patients from surprise medical bills. The law took effect January 1, 2022. It applies to most private health insurance plans and limits what patients can be charged in specific situations where they received care from out-of-network providers without choosing them.
Before this law, patients who went to in-network facilities could receive surprise bills from out-of-network providers working at those facilities. These providers could balance bill patients for the difference between their charges and what insurance paid. Balance billing means billing the patient for amounts above what insurance allows. A patient might go to an in-network hospital expecting to pay their regular copay and deductible. Instead, they received bills for thousands or tens of thousands from providers they never chose.
The No Surprises Act prohibits balance billing in specific situations including emergency services at any facility, non-emergency services at in-network facilities when out-of-network providers are involved without patient choice, and air ambulance services. In these situations, patients pay only their in-network cost-sharing amounts. Providers cannot bill patients for additional amounts beyond that in-network cost-sharing.
The law applies to group health plans, group and individual health insurance coverage, and Federal Employees Health Benefits plans. It covers the vast majority of privately insured Americans. The law does not apply to Medicare, Medicaid, Indian Health Services, Veterans Affairs, or TRICARE. These government programs have their own billing rules and protections.
Core Patient Protections
The No Surprises Act creates several fundamental protections that changed how billing works. Patients receiving emergency services cannot be balance billed by out-of-network providers regardless of which hospital or facility they go to. Emergency care must be treated as in-network for cost-sharing purposes. Patients pay their in-network deductible, copay, or coinsurance amounts. They cannot be charged additional amounts beyond that standard in-network cost-sharing.
This emergency protection applies to all emergency services including physician services, facility fees, diagnostic testing, laboratory work, and any other services provided as part of emergency care. The protection continues until the patient is stabilized. Once stabilized, if the patient needs additional non-emergency care at that facility, different rules may apply depending on whether the facility is in-network.
Patients receiving non-emergency care at in-network facilities are protected from surprise bills from out-of-network providers working at those facilities unless the patient gives informed consent to receive care from the out-of-network provider. The consent must be given at least 72 hours before the service for scheduled procedures. Without proper consent, the out-of-network provider cannot balance bill the patient.
This protection covers ancillary services provided by doctors the patient does not choose. Anesthesiologists, assistant surgeons, radiologists, pathologists, neonatologists, and other providers who work at facilities but are not chosen by patients fall under this protection. A patient who schedules surgery at an in-network hospital cannot be surprise billed by the anesthesiologist who is assigned to their case.
Air ambulance services fall under the No Surprises Act protections. Patients cannot be balance billed for air ambulance transport. Ground ambulances were not included in the federal law, though some states have their own ground ambulance protections.
What Providers Cannot Do
Under the No Surprises Act, out-of-network providers cannot balance bill patients in protected situations. This means they cannot send bills to patients for amounts beyond the in-network cost-sharing. The only amount the provider can collect from the patient is what the patient would have owed if the provider had been in-network.
Providers cannot pressure or coerce patients into waiving their protections. The consent process for waiving protections has strict requirements. Providers cannot require waiving protections as a condition of receiving care. They cannot use misleading information to obtain waivers. They cannot present waivers in situations where waivers are not allowed.
Providers cannot send threatening collection notices for amounts patients are protected from owing. If a provider bills a patient for balance amounts in a protected situation, and the patient does not pay because they know they are protected, the provider cannot send that bill to collections. Doing so violates the law.
Providers cannot retaliate against patients who assert their rights under the No Surprises Act. A patient who refuses to sign a waiver or who disputes a surprise bill cannot be refused future care, reported to credit agencies inappropriately, or punished for exercising their legal rights.
What Changed for Billing Practices
The No Surprises Act requires fundamental changes to how many providers bill patients. Out-of-network providers who previously relied on balance billing revenue must now accept payment from insurance without balance billing in many situations. This dramatically reduces revenue for some specialties and providers.
Providers must implement new processes for determining when the law applies, calculating correct patient cost-sharing, obtaining proper consent when appropriate, disputing payment amounts with insurers rather than billing patients, and tracking which claims fall under No Surprises Act protections.
Insurance companies must provide good faith estimates to out-of-network providers about what they will pay. They must process claims from out-of-network providers under new rules. They must participate in the Independent Dispute Resolution process when payment disputes arise.
Facilities must ensure all providers working there understand No Surprises Act requirements. They must track which providers are in-network and which are out-of-network. They must have systems for patients to be informed about network status before receiving non-emergency care.
The entire industry had to adapt to new billing limitations, new payment negotiation processes, and new patient protections. The change disrupted established billing practices and revenue models for many providers.
| Protection Type | What It Covers | Patient Responsibility |
| Emergency services | All emergency care at any facility | In-network cost-sharing only |
| Ancillary providers at in-network facilities | Services from providers patient didn’t choose | In-network cost-sharing only |
| Air ambulance | Emergency and non-emergency air transport | In-network cost-sharing only |
| Post-stabilization care | Continuing care after emergency stabilization | In-network cost-sharing only unless consent given |
When the No Surprises Act Applies
The No Surprises Act applies in specific situations. Understanding when protections apply and when they do not is required for correct billing.
Emergency Services
Emergency services are covered by No Surprises Act protections regardless of where the patient receives care and regardless of whether providers are in-network or out-of-network. Emergency services means services provided in an emergency department or any other setting where a prudent layperson would reasonably believe emergency care is needed.
The definition of emergency includes conditions manifesting symptoms of sufficient severity that absence of immediate medical attention could reasonably be expected to result in serious jeopardy to health, serious impairment of bodily functions, or serious dysfunction of bodily organs. This is a broad definition covering many acute medical situations.
Emergency services protection applies from the moment emergency treatment begins until the patient is stabilized. Stabilization means the patient’s emergency medical condition has been resolved or the patient can receive further treatment as an outpatient or be safely transferred. Until stabilization, all services are treated as emergency services under the protection.
A patient having a heart attack goes to the nearest emergency room regardless of network status. All care provided including physician services, facility charges, cardiac catheterization, stents placed, medications administered, and monitoring is protected emergency care. The patient pays only in-network cost-sharing. Out-of-network providers cannot balance bill.
Post-stabilization services continue to receive protection unless the provider gives the patient proper notice and obtains consent. If the patient is stabilized but remains in the emergency department for additional care or is admitted to the hospital, those subsequent services are still protected unless specific consent procedures are followed.
For emergency services, it does not matter if the facility is in-network or out-of-network. It does not matter if providers are in-network or out-of-network. Emergency services receive protection everywhere from everyone. This eliminates patient responsibility for researching network status during medical emergencies.
Non-Emergency Services at In-Network Facilities
When a patient receives non-emergency care at an in-network hospital or ambulatory surgical center, they are protected from surprise bills from out-of-network providers working at that facility. This protection applies to ancillary services from providers the patient did not choose.
Ancillary services include anesthesiology, radiology, pathology, neonatology, assistant surgeons, hospitalists, intensivists, and other services provided by physicians the patient does not select. When a patient schedules surgery, they choose the surgeon. They do not choose the anesthesiologist who is assigned to their case. That anesthesiologist cannot surprise bill the patient if they are out-of-network.
The protection applies because the patient had no meaningful choice in selecting these providers. The patient could choose an in-network facility. The patient could choose an in-network surgeon. But the patient could not choose which anesthesiologist, radiologist, or pathologist would be involved. These providers are assigned by the facility or practice group.
For the protection to apply, the facility must be in-network. If a patient chooses an out-of-network facility, the No Surprises Act does not protect them from balance billing by providers at that facility. Patients who choose out-of-network facilities accept responsibility for out-of-network charges.
The protection also does not apply if the patient gives informed consent to receive care from an out-of-network provider. Consent must meet specific requirements including being voluntary, being provided at least 72 hours before scheduled services, including a good faith estimate of charges, and including a list of in-network providers available to perform the service.
When Consent Can Waive Protections
Patients can waive their No Surprises Act protections in limited situations by providing informed consent to receive care from out-of-network providers. This consent allows the provider to balance bill the patient. However, consent is only valid when strict requirements are met.
Consent can only be obtained for non-emergency services. Emergency services cannot be waived. A patient in an emergency situation cannot give valid consent to balance billing. The emergency protections always apply regardless of any document the patient might sign.
Consent can only be obtained for services from providers the patient can meaningfully choose. This means the primary treating provider like a surgeon. Consent cannot be obtained for ancillary services the patient does not choose. An anesthesiologist cannot obtain valid consent to balance bill because the patient does not choose the anesthesiologist.
The consent notice must be provided at least 72 hours before scheduled services. For urgent but non-emergency care, the notice can be provided closer to the service date, but it must still be before service and must give the patient reasonable time to find an alternative in-network provider.
The notice must include specific information in clear language. It must state that the provider is out-of-network and may charge more than in-network providers. It must provide a good faith estimate of charges. It must list in-network providers available to perform the same service. It must state that the patient can choose an in-network provider. It must state that if the patient consents to the out-of-network provider, the patient may owe more.
Consent cannot be obtained as a condition of receiving care. A provider cannot refuse to provide care if the patient does not sign the consent form. The consent must be truly voluntary. Pressure, coercion, or conditioning care on signing the form invalidates the consent.
Even with valid consent, the provider can only charge amounts stated in the good faith estimate plus limited additional amounts. If actual charges exceed the estimate by substantial amounts, the patient may dispute the charges.
Air Ambulance Services
Air ambulance transport is protected under the No Surprises Act. Patients cannot be balance billed for air ambulance services. This applies to both emergency and non-emergency air ambulance transport.
The air ambulance protection was included because patients have no choice in air ambulance transport. In emergencies, first responders call the available air ambulance. Patients do not shop for in-network air ambulances. Even for scheduled inter-facility transfers, patients rarely have input into which air ambulance company is used.
Air ambulances are often out-of-network. Many air ambulance companies choose to remain out-of-network because they can charge higher rates. Before the No Surprises Act, air ambulances routinely sent patients bills for $30,000, $50,000, or more after insurance paid their portion. These bills were purely balance billing.
Under the No Surprises Act, patients pay only in-network cost-sharing for air ambulance services. The air ambulance provider cannot balance bill the patient. The provider must accept payment from insurance plus the patient’s in-network cost-sharing as payment in full.
If the air ambulance provider believes the insurance payment is inadequate, they must dispute the payment through the Independent Dispute Resolution process. They cannot bill the patient to make up the difference.
Ground ambulance services were not included in the federal No Surprises Act. Ground ambulances can still balance bill patients in most states. Some states have enacted their own protections for ground ambulances. Federal legislation addressing ground ambulances has been proposed but not yet enacted.
Services Not Covered by the Act
The No Surprises Act does not cover all situations. Understanding when protections do not apply helps patients and providers know what billing is allowed.
Services at out-of-network facilities are not protected. If a patient chooses to receive non-emergency care at an out-of-network hospital or facility, they can be balance billed by providers there. The choice to use an out-of-network facility means accepting out-of-network charges.
Services when the patient gives valid consent to out-of-network care are not protected. If all consent requirements are met and the patient knowingly chooses an out-of-network provider and signs appropriate consent, balance billing is allowed up to the amounts stated in the good faith estimate.
Post-stabilization services when proper notice and consent are given are not fully protected. Once a patient is stabilized from an emergency, the facility can provide notice about network status and obtain consent for continuing care. If the patient consents, balance billing may be allowed for non-emergency continuing care.
Primary treating providers who patients directly choose may be able to balance bill with consent.
If a patient schedules an appointment with a specific surgeon knowing the surgeon is out-of-network, and proper consent is obtained, the surgeon may balance bill. However, strict notice and consent requirements must be met.
Self-pay patients are not covered. The No Surprises Act protects patients with insurance. Patients without insurance coverage are not protected by this law. They can be billed full charges by any provider.
Services covered by Medicare, Medicaid, TRICARE, VA, or Indian Health Services are not covered by this law. These government programs have their own billing rules.
How the No Surprises Act Changes Billing
The No Surprises Act requires major changes to billing processes, especially for out-of-network providers who previously relied on balance billing.
Calculating Patient Cost-Sharing
The most significant billing change is that out-of-network providers in protected situations must calculate patient responsibility as if they were in-network. This requires knowing the patient’s in-network cost-sharing amounts.
Out-of-network providers do not have contracts with insurance companies establishing fee schedules. They do not typically have access to insurance company systems showing patient benefit details. Yet the law requires them to charge patients only in-network cost-sharing amounts.
The process starts with the provider billing the insurance company. The claim is submitted with the provider’s usual charges. The claim must include specific information indicating it falls under No Surprises Act protections. A specific diagnosis code or claim indicator shows the claim is for emergency services, services at in-network facilities, or other protected situations.
The insurance company processes the claim and determines what payment they will make to the out-of-network provider. Insurance companies established methodologies for calculating these payments, often based on a percentage of Medicare rates or databases of usual charges. The payment amount is often lower than what in-network providers receive because there is no negotiated contract.
The insurance company also determines what the patient’s in-network cost-sharing would be for that service. This is calculated based on the patient’s specific plan benefits. If the patient’s plan has a copay for certain services, that copay amount is the patient responsibility. If the plan has coinsurance, the coinsurance percentage applied to an in-network allowed amount determines patient responsibility.
The insurance company sends an Explanation of Benefits to the patient and a remittance to the provider. These documents show what insurance paid and what the patient owes. The amount the patient owes is the in-network cost-sharing amount, not a balance between the provider’s charges and insurance payment.
The provider can only bill the patient for the amount specified as patient responsibility by the insurance company. If insurance says the patient owes a copay amount, that is all the provider can bill. The provider cannot add additional amounts for the difference between their charge and the insurance payment.
If the patient has not met their deductible, they may owe a larger amount. But even this deductible amount is calculated as if the provider were in-network. The amount applied to deductible is based on an in-network rate, not the out-of-network provider’s charges.
This calculation method means patients have predictable out-of-pocket costs even when receiving care from out-of-network providers in protected situations. Patients pay what they would have paid if they had received care from in-network providers.
Good Faith Estimates
The No Surprises Act requires providers to give uninsured and self-pay patients good faith estimates of expected charges. This applies when patients ask for estimates or when care is scheduled. The estimate must be provided before service or within specified timeframes when requested.
For self-pay patients, the good faith estimate includes all expected charges from the provider and any other providers the provider knows will be involved. If a surgeon knows an anesthesiologist will be involved, the estimate includes expected anesthesia charges.
The good faith estimate must list each service expected, the expected date of service, expected charges for each service, and total expected charges. The estimate uses current cash prices. It must be clear and understandable.
When actual charges exceed the good faith estimate by certain amounts, patients can dispute the charges through a patient-provider dispute resolution process. This protects patients from being charged substantially more than estimated.
For insured patients receiving care from out-of-network providers, good faith estimates serve a different purpose. These estimates are required when obtaining consent for balance billing. The estimate shows what the out-of-network provider expects to charge so the patient can compare to potential in-network costs.
Good faith estimates must be provided within specific timeframes. For scheduled services, estimates are provided when services are scheduled. For requests from patients, estimates must be provided within specific business days depending on how the request is made.
Creating accurate good faith estimates requires coordination between providers, especially when multiple providers will be involved. The primary provider must gather estimate information from other providers and compile it into one comprehensive estimate.
Estimates are not guarantees of final charges. They are good faith predictions based on information available when created. If the patient’s condition during treatment requires additional services not anticipated, those additional charges may be billed even if they exceed the estimate. However, if charges exceed estimates simply because the provider underestimated or because additional services that should have been anticipated were not included, patients can dispute.
Independent Dispute Resolution Process
When out-of-network providers believe insurance companies are not paying adequate amounts for services provided under No Surprises Act protections, they cannot balance bill patients to make up the difference. Instead, they must use the Independent Dispute Resolution (IDR) process to dispute payment amounts with insurance.
The IDR process is the payment dispute mechanism created by the No Surprises Act. It is sometimes called arbitration, though the official term is Independent Dispute Resolution. This process determines payment amounts when providers and insurance companies cannot agree.
The process begins with negotiation. After the provider submits a claim and receives payment from insurance, if the provider believes the payment is inadequate, they initiate an open negotiation period. The provider and insurer have 30 business days to negotiate a payment amount. Many disputes are resolved during this negotiation without proceeding to IDR.
If negotiation fails, either party can initiate the IDR process. The initiating party files notice of IDR and pays initiation fees. Both parties select or agree on a certified IDR entity that will serve as the arbiter for the dispute.
Each party submits an offer of what they believe the appropriate payment amount should be. These offers are submitted to the IDR entity along with supporting information. The provider submits information about their usual charges, their costs, their training and experience, and other factors supporting their payment request. The insurer submits information about market rates, their contracted rates with in-network providers, and other factors supporting their payment offer.
The IDR entity reviews both offers and all supporting information. They select one of the two offers. They cannot create a compromise amount. They must choose either the provider’s offer or the insurer’s offer in full. This is called final offer arbitration or baseball-style arbitration.
The selected offer becomes the payment amount. If the IDR entity selects the provider’s offer and that amount exceeds what insurance already paid, insurance must pay the additional amount to the provider. If the IDR entity selects the insurer’s offer, the amount already paid stands and the provider receives nothing additional.
The IDR entity’s decision is binding. Both parties must accept it. Limited grounds for appeal exist only for specific procedural issues.
The losing party pays the IDR entity fees. If the provider’s offer is selected, insurance pays the fees. If the insurer’s offer is selected, the provider pays the fees. This fee allocation encourages reasonable offers because submitting an unreasonable offer that gets rejected means paying fees.
The IDR process takes approximately 30 days from initiation to decision. This is much faster than litigation would be. However, providers must wait through the 30-day negotiation period
first, then the IDR process, before receiving final payment. This delay affects cash flow for providers.
Providers and insurers can batch similar claims together for single IDR proceedings. This reduces administrative burden when the same provider and insurer have multiple disputed claims involving similar services and similar issues.
Requirements for Facilities
In-network facilities have new responsibilities under the No Surprises Act. They must ensure patients are not surprised billed by out-of-network providers working at the facility.
Facilities must track which providers have privileges or practice rights at the facility and whether each provider is in-network or out-of-network with major insurance companies. This tracking allows the facility to identify situations where patients might be at risk of surprise bills.
For scheduled services, facilities must inform patients about network status before service. If an out-of-network provider will be involved and that provider wants to balance bill, the facility must ensure proper consent processes occur.
Facilities must have systems ensuring out-of-network providers working at the facility understand No Surprises Act requirements. Many violations occur because individual providers do not understand the law. Facility compliance programs must educate all providers about their obligations.
Some facilities solved surprise billing problems by requiring all providers with privileges to join major insurance networks. Other facilities negotiated for their employed or contracted providers to be in-network. These approaches eliminate surprise billing risk by ensuring providers are in-network.
Facilities that allow out-of-network providers to practice must have robust processes for tracking these providers, informing patients, and ensuring proper consent when balance billing will occur.
Compliance Requirements
Providers and facilities must implement specific practices to comply with the No Surprises Act. Non-compliance risks penalties and patient complaints.
Provider Responsibilities
Providers must determine whether each patient encounter falls under No Surprises Act protections. This requires knowing whether the service is emergency care, whether the facility is in-network if it is non-emergency care, whether proper consent was obtained if the provider is out-of-network, and what type of service is being provided.
Systems must be implemented to flag protected situations. Practice management software should identify when services fall under the Act. Staff training ensures everyone understands how to identify protected situations.
For emergency services, providers must assume protections apply until proven otherwise. Emergency departments should have policies that emergency services are never balance billed. Coding and billing systems should automatically treat emergency claims as protected.
For services at in-network facilities, providers must verify facility network status. Just because a provider practices at a facility does not mean they know the facility’s network relationships with every insurance company. Verification systems are needed.
When providing services that might qualify for balance billing with consent, providers must follow strict consent procedures. The required notice must be given, the timing must be appropriate, the information must be complete and accurate, and consent must be documented.
Documentation is critical. Every protected situation should be documented in the patient’s file. If consent is obtained for balance billing, the signed consent form and all required information must be retained. If disputes arise, documentation proves compliance.
Billing staff must be trained to identify No Surprises Act claims and bill them correctly. Claims must include appropriate indicators showing they fall under the Act. Patient statements must not include balance amounts in protected situations.
When insurance processes a No Surprises Act claim, the remittance advice and EOB show what patient responsibility is. Billing systems must accept that amount as the total patient responsibility. Systems must not automatically generate balance bills.
Avoiding Violations
The No Surprises Act creates significant penalties for violations. Providers must actively avoid compliance problems.
Do not balance bill in protected situations. This is the fundamental rule. When services fall under No Surprises Act protections, accept the payment from insurance plus the in-network patient cost-sharing as payment in full. Do not bill patients for additional amounts.
Do not pressure patients into signing consent forms that waive protections. The consent must be voluntary. Conditioning care on signing consent, using misleading information, or creating pressure invalidates consent. If patients decline to sign consent, respect their decision and provide care anyway if you are able.
Do not obtain consent for services where consent is not valid. Ancillary providers who patients do not choose cannot get valid consent to balance bill. Emergency services cannot be consented away. Know when consent is and is not allowed.
Do not send surprise bills to collections. If a patient refuses to pay a balance bill in a protected situation, sending that debt to collections violates the Act. The patient is correct to refuse payment. Attempting collections harms the patient’s credit for a debt they do not legally owe.
Do not retaliate against patients who assert their rights. A patient who refuses to sign consent, who disputes a surprise bill, or who files a complaint cannot be punished. Refusing future care, badmouthing the patient, or other retaliation is prohibited.
Keep good faith estimates accurate. Do not lowball estimates to make them look attractive, then bill much higher amounts. Estimates should reflect realistic expectations of costs. When estimates turn out to be wrong, be prepared to justify why and potentially accept the estimated amount.
Use the IDR process for payment disputes. When insurance payment seems inadequate, the proper recourse is disputing with the insurance company through IDR. Billing the patient instead violates the law. IDR exists specifically to resolve provider-payer payment disputes without involving patients.
Respond to patient complaints promptly. If a patient contacts your office claiming they received a surprise bill in violation of the Act, investigate immediately. If they are correct, issue a corrected statement and remove any balance. Do not argue with patients about whether protections apply. If there is any question, err on the side of patient protection.
Patient Rights and Remedies
Patients have specific rights under the No Surprises Act and several remedies if those rights are violated.
Patients can file complaints with federal agencies when they receive surprise bills. The Department of Health and Human Services operates a surprise billing complaint process. Complaints trigger investigations and can result in penalties for providers.
Patients can dispute charges through the patient-provider dispute resolution process when charges exceed good faith estimates. This process is separate from the IDR process used for provider-payer disputes. Patient-provider disputes involve situations where self-pay or insured patients were given estimates and actual charges substantially exceeded those estimates.
Patients can refuse to pay surprise bills in protected situations. If a patient receives a balance bill for protected services, they can contact their insurance company to report the surprise bill. Insurance companies have processes for resolving surprise billing complaints and can take action against providers who violate the Act.
Patients may have legal recourse under state laws as well. Many states have their own surprise billing protections that may provide additional remedies beyond federal law. State attorneys general can bring enforcement actions for violations of state surprise billing laws.
Patients can report violations to state licensing boards. Balance billing in violation of the No Surprises Act may constitute unprofessional conduct subject to license discipline. Licensing boards can investigate and potentially discipline providers for violations.
The No Surprises Act itself does not create a private right of action allowing patients to sue providers directly for violations. However, state laws or other federal laws might provide grounds for lawsuits in specific situations.
Penalties for Non-Compliance
Violating the No Surprises Act carries significant penalties. Enforcement comes from multiple sources.
Federal Enforcement
The Department of Health and Human Services enforces the No Surprises Act. HHS can assess civil monetary penalties for violations. Penalties can reach $10,000 per violation. Each improper bill to a patient can be a separate violation.
For patterns of violations, penalties accumulate quickly. A provider who sends improper surprise bills to 50 patients faces potential penalties of $500,000. Ongoing patterns of violations can result in millions of dollars in penalties.
HHS investigates complaints filed by patients. When complaints are filed, HHS contacts the provider to investigate. They review billing records, documentation, and communications with patients. If violations are found, they assess penalties and require corrective action.
The Department of Labor also has enforcement authority for self-funded ERISA plans. Department of Labor can investigate violations affecting self-funded employer health plans and assess similar penalties.
State insurance departments enforce the Act for fully-insured plans. States have authority to investigate violations and assess penalties under state law for violations of federal surprise billing protections.
Enforcement priority focuses on egregious or repeated violations. Isolated mistakes handled appropriately when discovered are less likely to result in penalties than patterns of deliberate violations or failures to correct problems after notification.
State Enforcement
Many states had surprise billing laws before the federal No Surprises Act. Some state laws provide stronger protections than federal law. When state law is more protective, the stronger state protections apply.
State attorneys general can bring enforcement actions for violations of state surprise billing laws. Some states have specific penalties for surprise billing violations. These state penalties can be assessed in addition to federal penalties.
State licensing boards can discipline providers for billing violations. Balance billing in violation of surprise billing laws may be considered unprofessional conduct or violations of billing regulations. Discipline can include fines, license suspension, or license revocation.
State consumer protection agencies may also have jurisdiction over surprise billing. Unfair or deceptive billing practices violate consumer protection laws in many states. Surprise billing could be prosecuted under these broader consumer protection statutes.
Reputational and Business Consequences
Beyond formal penalties, violating the No Surprises Act carries reputational harm and business consequences.
Insurance companies may take action against providers who repeatedly violate surprise billing protections. While out-of-network providers do not have contracts to terminate, insurance companies can flag providers as problematic, refer them for investigation, or take other actions that make doing business more difficult.
Facilities may restrict privileges for providers who violate the Act. In-network facilities face their own compliance responsibilities and do not want providers practicing there who create compliance problems. Facilities may require surprise billing compliance as a condition of granting or maintaining privileges.
Patients who receive surprise bills share their experiences publicly. Online reviews, social media posts, and word-of-mouth damage provider reputations. Practices known for surprise billing lose patients. Referral sources stop referring.
Media coverage of surprise billing violations attracts negative attention. Local news stories about providers sending illegal surprise bills create lasting reputational damage. The business impact of negative publicity often exceeds formal penalties.
Patient complaints to insurance companies strain relationships. While out-of-network providers do not have contractual relationships to protect, insurance companies remember providers who create problems. When those providers later seek to join networks, previous surprise billing violations may be considered.
Conclusion
The No Surprises Act fundamentally changed medical billing practices starting January 1, 2022. The law protects patients from surprise medical bills in specific situations including emergency services at any facility, non-emergency services at in-network facilities when out-of-network providers are involved without patient choice, and air ambulance services.
In protected situations, patients pay only their in-network cost-sharing amounts. Out-of-network providers cannot balance bill patients for amounts beyond in-network cost-sharing. This prohibition applies even though the provider has no contract with the insurance company and even though the provider’s charges exceed insurance payment.
Providers can obtain patient consent to balance bill in limited non-emergency situations with strict requirements. Consent must be given at least 72 hours before scheduled services, must include specific required information, must be voluntary, and can only be obtained for services the patient meaningfully chooses.
When providers believe insurance payment is inadequate, they must use the Independent Dispute Resolution process to dispute payment with insurers. They cannot bill patients to make up payment differences. The IDR process involves negotiation followed by final offer arbitration if negotiation fails.
Compliance requires identifying which services fall under Act protections, calculating patient cost-sharing correctly as in-network amounts, providing good faith estimates when required, following proper consent procedures if seeking to balance bill, using IDR for payment disputes instead of billing patients, and training staff on all requirements.
Violations carry penalties up to $10,000 per improper bill, enforcement by federal and state agencies, potential license discipline, and significant reputational harm. Providers and facilities must implement robust compliance programs to avoid violations.
The No Surprises Act represents the most significant change to medical billing practices in decades. It shifts financial risk from patients to providers and payers. It requires new administrative processes and systems. It fundamentally altered the business model for providers who relied on balance billing revenue. Understanding and complying with the Act is not optional for any provider or facility touching patients with private insurance.
