No Surprises Act

The No Surprises Act is a federal law that was passed as part of the Consolidated Appropriations Act in 2021.

Effective January 1, 2022, the No Surprises Act seeks to protect patients from surprise medical bills, which occur when patients receive medical treatment from an out-of-network healthcare provider without their knowledge or consent, and then receive an unexpected bill for the difference between the provider’s charges and the amount paid by the patient’s insurance plan.

The No Surprises Act establishes a number of new protections for patients, including:

1. Limiting patient cost-sharing for out-of-network emergency services and certain out-of-network ancillary services to the amount that would be charged if the services were provided in-network.
2. Prohibiting out-of-network providers from balance billing patients for emergency services and certain ancillary services.
3. Requiring health plans to provide patients with a good faith estimate of the expected cost of certain scheduled services and to disclose whether any providers involved in the service are out-of-network.
4. Establishing a dispute resolution process for providers and health plans to resolve payment disputes for out-of-network services.

How do Healthcare Providers comply with the No Surprises Act?

As initial steps, healthcare providers can do the following to come in compliance with the No Surprises Act:

1. Review contracts with health plans and insurers: Healthcare providers should review their contracts with health plans and insurers to ensure that they comply with the requirements of the No Surprises Act. For example
2. Notify patients of potential out-of-network services: Providers should inform patients about the potential for out-of-network services and explain their financial responsibility for such services. This can be done by providing patients with a written notice that explains their rights and responsibilities
3. Maintain up-to-date information on in-network providers: Providers should maintain up-to-date information on in-network providers and ensure that they are able to refer patients to in-network providers for services that are not available in-house.
4. Participate in the dispute resolution process: If a dispute arises between a provider and a health plan or insurer over payment for out-of-network services
5. Keep accurate records: Providers should keep accurate records of all services provided

Good-Faith Estimate Requirement

The Good Faith Estimate (GFE) requirement in the No Surprises Act is designed to provide patients with more information about the potential cost of their medical care. Under the law, healthcare providers and facilities must provide patients with a GFE for certain scheduled services.

The GFE must include the following information:

1. The estimated amount that the provider will charge for the service.
2. The amount that the patient will be responsible for paying after insurance has been applied.
3. The amount that the insurance plan is expected to pay for the service.
4. A list of any other providers who may be involved in the patient’s care and whether they are in-network or out-of-network.
5. An explanation of the patient’s right to receive care from an in-network provider and the potential financial consequences of receiving care from an out-of-network provider.

The GFE must be provided to the patient in writing at least three business days before the scheduled service is provided. If the patient agrees to receive the service earlier than three business days, the GFE must be provided as soon as possible but no later than at the time of service.

The GFE requirement is intended to help patients understand the potential cost of their medical care and make more informed decisions about their healthcare. By providing patients with a GFE, healthcare providers and facilities can help prevent surprise medical bills and ensure that patients are not left with unexpected expenses.

RFM Legal advises clients on regulatory compliance and emerging issues in healthcare law. We offer legal consulting services to healthcare providers and business organizations in California and other key jurisdictions. For more information on this topic, please contact us.