What Is No Surprises Act?
The No Surprises Act is a federal law effective January 1, 2022 that prohibits balance billing for most out-of-network emergency services, certain non-emergency services at in-network facilities, and air ambulance services, with disputes resolved through an Independent Dispute Resolution (IDR) process.
- The same section sets what the estimate must contain, when a replacement estimate is required, and how co-providers are handled, so build the workflow from the section rather than from a summary of it.
No Surprises Act
Also known as: NSA; Surprise Billing Law; CAA Title I
The No Surprises Act is a federal law effective January 1, 2022 that prohibits balance billing for most out-of-network emergency services, certain non-emergency services at in-network facilities, and air ambulance services, with disputes resolved through an Independent Dispute Resolution (IDR) process.
Definition
Enacted as part of the Consolidated Appropriations Act, 2021, the No Surprises Act applies to group health plans, individual market coverage, and insured and self-funded ERISA plans. It bars balance billing for out-of-network emergency services, for certain non-emergency services furnished by non-participating providers at participating health care facilities, and for air ambulance services; the patient owes only the cost sharing they would have owed in network. The qualifying payment amount anchors the plan’s payment, and a plan-provider dispute that open negotiation does not resolve goes to the federal independent dispute resolution process — except where a specified state law governs the payment instead, which is common for fully insured coverage, so the first question in any dispute is whether the federal process applies to that plan at all. Separately, providers and facilities must furnish good faith estimates of expected charges to uninsured and self-pay individuals (45 CFR 149.610). This page summarizes a complex statute and its implementing rules; confirm the specifics against current CMS guidance and with counsel before changing a billing practice.
Example
A patient with a PPO has elective surgery at an in-network hospital and the anesthesiologist is out of network. The patient owes only in-network cost sharing for the anesthesia, and the plan and the anesthesiologist settle the balance between them, with the federal independent dispute resolution process available where a specified state law does not govern instead. The detail that decides this case is that anesthesiology sits on the ancillary-services list at 45 CFR 149.420, which makes the notice-and-consent route out of the protection unavailable for it — a consent form signed at check-in does not make this balance billable.
Common Misconceptions
Ground ambulance is outside the Act — a genuine carve-out. But the notice-and-consent exception is far narrower than it is usually described. The regulation makes it unavailable for ancillary services, defined to include “items and services related to emergency medicine, anesthesiology, pathology, radiology, and neonatology, whether provided by a physician or non-physician practitioner”, items and services provided by “assistant surgeons, hospitalists, and intensivists”, “diagnostic services, including radiology and laboratory services”, and items and services provided by a non-participating provider where no participating provider can furnish them at that facility — and also for items or services “furnished as a result of unforeseen, urgent medical needs that arise at the time an item or service is furnished” (45 CFR 149.420). State surprise-billing laws continue to apply to fully insured coverage in states that have them, and which law governs also determines where a payment dispute is heard.
Practical Application
Identify protected encounters in the billing workflow, suppress balance billing on them, and route disputes through the correct process — federal independent dispute resolution only where a specified state law does not govern. For good faith estimates, work from the regulation’s actual triggers rather than a single lead time: 45 CFR 149.610 requires the estimate not later than 1 business day after scheduling where the item or service is scheduled at least 3 business days ahead, not later than 3 business days after scheduling where it is scheduled at least 10 business days ahead, and not later than 3 business days after the request where an uninsured or self-pay individual asks for one. The same section sets what the estimate must contain, when a replacement estimate is required, and how co-providers are handled, so build the workflow from the section rather than from a summary of it.
Related Terms
Price Transparency Rule
Price transparency rules are two separate federal requirements: hospitals must publish standard charges, including payer-specific negotiated charges, under 45 CFR part 180, and health plans and issuers must publish in-network and out-of-network pricing files under the Transparency in Coverage rules at 45 CFR 147.210 to 147.212.
Read definitionCommercial Payer
A commercial payer is a private (non-government) insurance company offering health coverage to individuals or employer groups, typically as PPO, HMO, EPO, or POS products. A fully-insured product is regulated as insurance by the state; an employer-sponsored plan that ERISA covers is also subject to the federal claims-and-appeals rule, whether that plan is fully-insured or self-funded.
Read definitionPrior Authorization
Prior authorization is the payer's process of pre-approving a planned service, procedure, medication, or admission before it is rendered, based on medical-necessity criteria; without an approved PA where required, claims typically deny under CARC 197.
Read definitionMHPAEA
The Mental Health Parity and Addiction Equity Act of 2008 is a federal law that requires group health plans and health insurance issuers offering mental health and substance use disorder (MH/SUD) benefits to provide them no more restrictively than medical/surgical benefits.
Read definitionWhere This Applies on MedPrecision
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