Preventing Surprise Medical Billing
Suppose you are in a serious car accident and must be airlifted to the nearest hospital. You are treated and recover well, but then you receive a huge medical bill from an out-of-network provider. It’s the difference between what the provider charged and what the payer agreed to pay. This is called surprise medical billing, and it can devastate a patient’s finances. Congress recently passed the No Surprises Act to protect patients from this situation. How does this legislation affect providers, payers, and patients?
What is surprise billing?
Surprise billing, aka balance billing, is when a provider bills a patient for the balance of medical fees after the insurance company has paid its share. It usually occurs when a person receives medical treatment, often without realizing it, from a healthcare provider or facility outside their insurance company’s network. The patient is then responsible for paying more than their expected share, which usually consists of the deductible, copay, and any coinsurance. Surprise billing often happens in emergency cases when a patient has no choice, but it can also occur when other out-of-network medical professionals, such as specialists, anesthesiologists, or lab personnel, participate in a patient’s medical care.
No Surprises Act
Because medical balance bills are an unexpected hit to an insured person’s finances, these surprise bills have been the target of several legislators, and in January 2022, the No Surprises Act went into effect. This legislation protects patients from unavoidable out-of-network expenses. Although the primary target for the act is emergency situations, it also has applications in nonemergency healthcare services.
Implications of the No Surprises Act
For patients, the legislation protects them from unavoidable out-of-network expenses and allows them more choices in their healthcare based on what they can afford. This can result in better health outcomes, lower prices, and greater patient satisfaction.
The No Surprises legislation calls for medical providers and facilities to provide an estimate of the expected charges for all services, including related services performed by other providers, even if they are not part of the same health system. It also requires private health plans to cover unavoidable out-of-network claims and apply in-network cost sharing.
Another element of the No Surprises Act is the establishment of an independent arbitration process for billing disputes between providers and insurance companies. If the two parties disagree on how much should be paid, an independent arbiter will consider all information provided by both provider and payer to set amounts for each. The arbiter’s decision is final.
There will likely be much more to iron out as implementation of the act begins, but it is a step toward reducing catastrophic surprise medical bills for insured patients.
To learn more about the No Surprises Act, and its potential impact on your healthcare system’s revenue cycle management, contact the experts at Healthcare Resource Group.
