Here’s What It Means for Your Medical Bills

If you’ve used an emergency room or been hospitalized in the United States, there’s a good chance you’ve got medical billing that caught you by surprise. One in five Americans has received a surprise medical bill from an emergency department visit; nearly as many have gotten unexpected bills from non-emergency hospital stays.

These bills are more than a nuisance for many; they can cause anxiety and financial hardship. Two out of three Americans say they worry about being able to afford unexpected medical bills and nearly half can’t afford to pay surprise bills in full.

Now, many surprises medical bills are poised to become a thing of the past, thanks to the No Surprises Act, which took effect on January 1, 2022.

The new law, passed in late 2020, provides consumers with federal protection from unexpected out-of-network medical bills—bills from healthcare providers who don’t participate in the patient’s health insurance network.

Out-of-network charges are common in emergency care, where consumers don’t necessarily have a choice in where they go or who provides their care. These charges can also arise during nonemergency hospitalizations, where multiple providers may be involved in care.

Even if a hospital participates in a patient’s insurance plan, specific providers, such as anesthesiologists or radiologists, may not. Consumers may have no idea that they’re getting care from out-of-network providers and no say in it either.

That’s now set to change. 

The law requires that private health insurance companies cover certain out-of-network bills and apply consumer co-payments or other costs as if the care had been delivered by in-network providers. It also prohibits doctors and hospitals from charging consumers more than they would have to pay for the applicable services if the providers were in-network with the insurance company.

The No Surprises Act applies to bills for emergency services provided in hospital emergency departments, freestanding emergency facilities, and urgent care centers that provide emergency services. It also covers air ambulance transportation—but not ground ambulance—and non-emergency services provided by out-of-network providers who may practice at but bill separately from in-network facilities.

What the No Surprises Act Means for You

As of January 1, 2022, consumers have new billing protections when getting emergency care, non-emergency care from out-of-network providers at in-network facilities, and air ambulance services from out-of-network providers. Through new rules aimed to protect consumers, excessive out-of-pocket costs are restricted, and emergency services must continue to be covered without any prior authorization, and regardless of whether or not a provider or facility is in-network.

Previously, if consumers had health coverage and got care from an out-of-network provider, their health plan usually wouldn’t cover the entire out-of-network cost. This left many with higher costs than if they’d been seen by an in-network provider.

This is especially common in an emergency situation, where consumers might not be able to choose the provider. Even if a consumer goes to an in-network hospital, they might get care from out-of-network providers at that facility.

In many cases, the out-of-network provider could bill consumers for the difference between the charges the provider billed, and the amount paid by the consumer’s health plan. This is known as balance billing. An unexpected balance bill is called a surprise bill.

The Consolidated Appropriations Act of 2021 was enacted on December 27, 2020, and contains many provisions to help protect consumers from surprise bills, including the No Surprises Act under title I and Transparency under title II. Learn more about protections for consumers, understanding costs in advance to avoid surprise bills, and what happens when payment disagreements arise after receiving medical care.