Understanding the No Surprises Act

By AGS Health

March 2, 2022

Legislation Overview

On December 27th, 2020, the Consolidated Appropriations Act was signed into law. Among the provisions included in this body of legislation was the No Surprises Act, which seeks to protect patients from surprise medical bills and prohibits balance billing of patients for certain out-of-network care. The law is still subject to the rulemaking process. The No Surprises Act took effect on January 1, 2022, and has had dramatic effects on how U.S. healthcare providers are required to conduct their business operations.

Frequently Asked Questions

  1. What situations prohibit a provider from balance billing patients?

    The legislation prohibits providers from balance billing in 3 separate instances:

    • Out-of-network emergency items and services
    • Out-of-network non-emergency items and services provided by an in-network facility
    • Out-of-network air ambulance healthcare items and services

    A non-participating provider offering non-emergency care in a participating facility can balance bill a patient only if they provide advanced notice of their network status and an estimate of the charges at least 72 hours prior to receiving out-of-network care. The patient must acknowledge they have been given this information, so tracking these advanced notifications is key to reimbursement.

    Provider specialties who are impacted specifically include:

    • Emergency medicine
    • Anesthesiology
    • Pathology
    • Radiology
    • Neonatology
    • Diagnostic Services

    Does the No Surprises Act (NSA) apply to beneficiaries or enrollees in federal programs, such as Medicare, Medicaid, Indian Health Services, Veterans Affairs Health Care, or TRICARE?

    No, as these programs already have other protections against high-balance medical billing.

  2. What is involved with the negotiation between payers and providers for reimbursement, as well as the arbitration process?

    The provider can accept the initial payment or, within 30 days of payment, initiate open negotiations with the payer for a different amount. If a resolution is not reached after 30 days of open negotiations, either party has 4 days to send notice of an Independent Dispute Resolution (IDR) request. Once an IDR entity has been selected, a 30-day IDR process begins. In the initial 10 days of the IDR process, the parties must submit their payment offers.

    If an IDR is initiated, how are decisions made during the process?

    The IDR entity will consider several factors in determining the decision:
    • Payment offers
    • Median in-network rates – as defined in the Act
    • Any requested or submitted information to clarify justification of the expected amount
    • Level of provider experience/training/quality
    • Market share of provider
    • Acuity of the patient
    • Case mix/scope of services
    • Demonstrations of good faith to enter network agreements over last 4 years
  3. Is the price negotiation under the NSA different from an appeal?

    The IDR process outlined in the NSA is considered a price negotiation and settlement, focused on the payment itself. The term “appeal” does not appear in the NSA in connection with the price negotiation and settlement.

  4. Can a member challenge a balance bill or negotiate a lower payment after notification that the provider is out-of-network?

    The consent form that the member signs is an acknowledgment that the member has read the notice, and is not considered a contractual obligation for payment, according to the NSA. The implication is that the member or plan can still dispute or negotiate with the provider on the member’s payment.

  5. What happens when a member/patient receives a balance bill for emergency or other services which are prohibited from balance billing?

    If the member receives a balance bill that is prohibited by the NSA, the member should be advised to contact their health plan. The NSA requires the US Department of Health and Human Services (HHS) to establish a complaint process for patients to report out-of-network items and services.

  6. How will the Advanced Explanation of Benefits (AEOB) process work before services are rendered?

    The AEOB is triggered by the “good faith estimate” that the provider submits to the member’s health plan. While the Act does not prohibit a plan from providing additional information in the AEOB, the law’s language implies that the cost-sharing estimate itself should be based on the provider’s good faith estimate and not on the amount the plan believes the provider will ultimately accept as payment.

    HHS will be publishing regulations in the coming months around how the NSA’s provisions will apply to Reference Based Pricing Plans and how the data in the AEOB should be calculated.

  7. What are the penalties to providers for violations of the NSA?

    For services covered by the NSA, providers are prohibited from billing patients more than the applicable in-network cost-sharing amount; a penalty of up to $10,000 for each violation can apply.

  8. How will enforcement of the NSA work?

    If problems arise, consumers might need to seek help from more than one enforcing agency. The federal government has exclusive enforcement responsibility for most private health plans, though different agencies may be involved. States governments will lead enforcement for state-regulated plans.

  9. How can AGS Health help providers manage through the NSA processes?

    • We can help through tracking accounts in the IDR process for follow-up purposes.
    • We can provide insurance claim follow-up on outstanding IDR resolved claims.
    • We can help with posting correct contractual allowances/agreed upon reimbursement amounts on behalf of the providers – correct financial class allocation (self-pay vs. insurance)
    • We can support customers with initial in-network pricing, based on provider’s fee schedules or hospital’s CDM prices for upfront “good faith estimates” to patients.
    • We can assist with sending advanced notifications to patients/members where providers are required to notify of their network status and good faith estimates.
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