What You Need to Know about the No Surprises Act

by | Mar 9, 2022 | Healthcare

Calculator and stethoscope displayed next to a medical bill

On January 1, 2022, the No Surprises Act took effect – much to the surprise of many healthcare providers and insurance plans. Implementing new regulations is never easy as there always seem to be endless clauses and nuances. However, we can help you understand and adhere to these latest regulations with our comprehensive guide to the No Surprises Act.

Today we will break down some of the hard-to-understand No Surprises Act regulations into clear ideas.

Key Takeaways:
  • The No Surprises Act protects patients from receiving surprise bills for out-of-network services received from in-network providers.
  • This act also protects non-insured and out-of-pocket payers from receiving bills significantly higher than their good faith estimate.
  • Insurance providers and healthcare facilities are now responsible for handling many out-of-network bills instead of patients.
  • Healthcare providers are responsible for disclosing all billing information to patients – including any waivers to their billing protections.

What is the No Surprises Act?

The No Surprises Act protects patients against receiving surprise medical bills. These most often occur when a patient is treated by out-of-network providers or with out-of-network services at an in-network facility. The bill also protects uninsured patients or those who choose to pay out-of-pocket from receiving bills that are more than their provider’s good faith estimate.

Additionally, the No Surprises Act outlines the process that providers and insurance companies must go through to settle on the cost of out-of-network surprise bills.

Why Is the No Surprises Act Important?

About 40% of insured adults received an unexpected medical bill over the last year. Additionally, 10% say that the bill was from an out-of-network provider. Nearly 80% of Americans supported a law that would protect them from these types of bills.

38% of respondents on a survey said they were very worried about affording unexpected medical bills.
Image source: Peterson-KFF Health System Tracker

Previously, out-of-network providers were responsible for billing patients directly for the total amount of the service. The patient was then responsible for filing a claim with their insurance plan in hopes that they will cover it in part or in whole.

Starting this year, patients won’t need to jump through that extra hoop, thanks to the No Surprises Act. Instead, out-of-network providers will file their claims directly through insurance plans instead of sending a surprise bill to the patient. The insurance plan and provider will then settle the bill amount through open negotiations.

What Does the No Surprises Act Protect?

According to the Centers for Medicare & Medicaid Services, here is a list of specific protections included in the No Surprises Act for those with health insurance:

  • Patients are protected from surprise bills from most emergency services – both in and out-of-network that you did not give prior authorization for beforehand.
  • Patients are protected from receiving out-of-network cost-sharing for most emergency and some non-emergency services. Instead, they will receive bills equal to or less than in-network cost-sharing services.
  • Patients are protected from receiving bills and charges for additional services from out-of-network providers like anesthesiology or radiology as part of their bill from an in-network provider.
  • Providers must provide patients with a full disclosure about their billing protections.

The act also protects patients without insurance and self-paying patients by ensuring the final bill is not more than the provider’s good faith estimate.

What Healthcare Providers Should Include on a Disclosure

The last point above noted that providers must give patients a disclosure about the patient’s billing protections. Here are more details on what that disclosure should include.

The disclosure should be easy to read and understand for the average patient – ideally short enough to fit on one page. It should outline the patient’s billing protections directly related to their specific case. Additionally, the patient should find contact information in the disclosure to ensure they have someone to speak to if they suspect their billing rights have been violated.

The patient should also understand when they waive their rights to billing protections. For example, this can happen when they sign a waiver to accept out-of-network services at out-of-network costs in an in-network facility.

When Patients Can Waive Their Rights

There are exceptions to the No Surprises Act, the primary exception being that patients might willingly waive their rights to billing protections. However, there are certain circumstances when a provider cannot ask a patient to waive their rights. The image below outlines those circumstances.

Six reasons a notice and consent waiver is not permitted
Image source: KFF

How This Bill Affects Insurance Providers and Healthcare Facilities

There are several changes in how insurance companies and healthcare facilities process bills because of the No Surprises Act. Primarily, healthcare facilities and insurance plans are now the ones responsible for identifying and acting on most surprise bills versus giving the patient the responsibility of filing out-of-network claims when they received care in an in-network facility.

Additionally, health insurance plans need to cover out-of-network claims and apply in-network cost-sharing. Healthcare providers also cannot charge patients more for surprise medical bills than their in-network cost-sharing amount.


Video: How the No Surprises Act Impacts Your Practice

How Insurance Providers Should Negotiate Claims

The No Surprises Act lays out some rules for how insurance plans and healthcare providers can negotiate the billing amount. For example, insurance providers must address bills promptly and respond to healthcare provider claims within 30 days with the appropriate in-network cost-sharing amount.

However, sometimes providers and plans won’t agree. In those instances, the act also has an independent dispute resolution process. In this process, the healthcare facilities and insurance plans must:

  • Meet all deadlines
  • Avoid conflicts of interest
  • Decide upon a separate dispute resolutions entity
  • Submit a payment offer
  • Provide any needed additional information

Penalty for Breaching the No Surprises Act

When a provider bills a patient for more than their in-network cost-sharing amount, they can receive a penalty of up to $10,000 per violation. While the provider and insurance plan are responsible for upholding this new bill, a patient is responsible if surprise bills slip through.

Who enforces the No Surprises Act?

Centers for Medicare & Medicaid Services (CMS) is the ultimate authority for enforcing the bill. However, most state authorities will enforce it within their jurisdiction.

Efficiently Implement the No Surprises Act through MDM

The No Surprises Act will help you keep your customers safe. However, it will require more management on your end as you are now responsible for processing most out-of-network claims. Instead of feeling overwhelmed, try our master data management platform for storing, sharing, and processing patient data all while ensuring data quality to help you correctly handle billing claims.

Contact us to learn how our platform can help you adhere to the No Surprises Act. 



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