The No Surprises Act has been in effect for a few weeks, but most healthcare organizations still have unanswered questions about what its interim final rules mean—and the steps they must take to comply with them.

To help you understand the new requirements associated with the No Surprises Act—and to learn more about ensuring compliance with them—we’ve summarized the key provisions here.

What is the No Surprises Act?

Simply put, the No Surprises Act protects patients from surprise medical bills that come from unknowingly receiving care that isn’t covered by their insurance plan—for example, when a patient receives a bill for the difference between the charges for out-of-network care and what their insurance plan covers. This practice, known as “balance billing” or “surprise billing,” can leave patients stuck with unexpected and excessive out-of-pocket costs.

To help address the burden of unknown and unexpected medical bills, the No Surprises Act prohibits providers and facilities, in most situations, from billing patients more than the in-network cost sharing amount for healthcare services. For some items—like certain non-emergency, post-stabilization and ground ambulance services—exceptions may exist as long as providers follow strict notice and consent procedures, which include providing a good-faith estimate of expected charges before delivering services. If billed charges exceed the estimate, then patients may dispute the bill. If a patient disputes the bill, providers must participate in an independent dispute resolution process.

Who needs to pay attention—and who doesn’t

With some limited exceptions, the No Surprises Act applies to all care settings, all visits and services, and all provider specialties—but all providers should pay attention. The No Surprises Act also applies to most patients, including those who are self-pay, uninsured or commercially insured.

The No Surprises Act does not apply to:

• Ground ambulance transportation services
• Same-day or walk-in outpatient visits
• Patients enrolled in federal programs like Medicare, Medicaid, the Indian Health Service, Veterans Affairs Health Care or TRICARE

Understanding the No Surprises Act’s balance-billing requirements

“The No Surprises Act imposes strict limitations around how and when providers can balance bill patients for out-of-network care,” said Rebecca Kennedy, a senior associate with international law firm Goodwin Procter LLP. “To comply with the Act, providers and third-party payers will need to make significant changes to the way they interact with and bill patients.”

“Providers and third-party payers will need to develop processes and policies to ensure that the appropriate disclosures and notices are given to patients—and to ensure patients are billed for services in a manner that complies with the Act’s prohibitions on balance and surprise billing,” said Anne Brendel, senior associate with Goodwin Procter LLP.

Balance-billing limitations may vary depending upon the provider, as well as the type of services delivered, as follows:

• Emergency services: Balance billing is prohibited for most emergency services, including out-of-network care provided in hospital emergency rooms, emergency departments and other facilities licensed to provide emergency care.
• Certain non-emergency services: When a patient receives non-emergency services from an out-of-network provider at an in-network facility, balance-billing is only allowed when the patient provides written consent to waive their No Surprises Act billing protections after receiving appropriate notice documentation from the provider. Note that such patient waiver does not apply to non-emergency ancillary services.
• Unforeseen, urgent medical needs: Balance billing is prohibited when a patient receives unforeseen items or services to address urgent medical needs in the course of care delivery. This prohibition applies to both emergency and non-emergency services.
• Post-stabilization services: For services related to an emergency medical condition, providers may balance-bill patients only when certain conditions are met.
• Ambulance services: Balance billing is prohibited when a patient receives air ambulance services, which often are provided on an out-of-network basis. However, patients may be balance-billed for ground ambulance services that are not covered by their insurance plan.

Navigating cost-sharing rules

In situations where balance-billing is prohibited, patients cannot be billed more than their insurance plan’s in-network cost-sharing amount, which includes items like copayments, coinsurance and deductibles.

But how is the cost-sharing amount calculated?

It depends. Per the No Surprises Act’s interim final rules, the cost-sharing rate may be calculated in one of three ways:

1. An amount determined by a state’s all-payer model agreement, if one exists
2. An amount determined by an applicable state law if one exists, provided the state does not have an all-payer model agreement in place
3. An amount equal to either the qualifying payment amount or the billed charge for services—whichever is lower. This determination applies in cases where there is no applicable state law or all-payer model agreement

In addition, the Centers for Medicare & Medicaid Services (CMS) has published a helpful fact sheet that includes broader guidance on cost-sharing rates.

Given the complexity of the No Surprises Act, “We encourage providers, facilities and payers to work closely with their respective legal counsel to ensure they are in compliance with all of the new and applicable requirements,” Kennedy said.

Giving notice and getting consent

Making sure that patients understand their role—and their rights—in paying for medical care is an important part of the No Surprises Act. That’s why providers and facilities that intend to balance bill must give notice and consent documentation to any out-of-network patients seeking care for which notice-and-consent exceptions are permitted.

The U.S. Department of Health and Human Services offers standard notice and consent documents for providers and facilities to use. These documents include:

• A disclaimer stating that the provider or facility is out-of-network
• The estimated cost of services, or “good faith estimate”
• A signature page that allows patients to voluntarily waive their No Surprises Act billing protections

These documents must be provided to patients within 72 hours of a scheduled out-of-network service—or within three hours for same-day services. Notice and consent documents must be provided in writing using the patient’s preferred communication method.

Similarly, providers and facilities must notify the patient’s health plan when they provide services to an out-of-network patient, and they must verify that the notice and consent requirements have been met. And be sure to retain the records: Providers and facilities must hold on to notice and consent documents for at least seven years.

Remember: Providers can’t surprise bill for ancillary services. That means notice-and-consent requirements do not apply to:

• Services related to emergency medicine, anesthesiology, pathology, radiology and neonatology
• Services provided by assistant surgeons, hospitalists and intensivists
• Diagnostic services, including radiology and laboratory services
• Services and items administered by an out-of-network provider if there is no in-network provider who can offer them at the facility

“In any case in which a provider has questions about the data required to prepare a good-faith estimate or language that should be included in a notice to a patient, they should reach out to their legal counsel,” Brendel said. “These issues are often fact-specific, and your legal team can help provide clarity.”

Find out more

For more insight into how the No Surprises Act may impact your organization, review this list of provider requirements and resources from CMS.

Learn how Phreesia can help you collect respectfully and consistently at the time of service and give patients the financial experience they expect.