What the No Surprises Act Means for Your Medical Bills

man and woman couple seated in living room looking at medical bill paper

If you've ever received an unexpectedly large bill after a visit to the emergency room or other medical treatment, you'll appreciate the No Surprises Act. As of January 1, 2022, the No Surprises Act protects people with group and individual health plans from receiving surprise medical bills for a variety of health care services. This list includes: most emergency services, nonemergency services from out-of-network providers at in-network facilities and air ambulance services from out-of-network providers.

If you are uninsured or self-pay for health care, providers must give you a good faith estimate of costs if requested or once you've scheduled medical care. Here's a closer look at what the new law covers and how it works.

Why Might You Get a Surprise Medical Bill?

Unexpected medical bills frequently arise from emergency medical services. In an emergency, you rush to the closest hospital without checking whether it's in your network; later, your insurance company denies the claim.

You might also get unexpected bills even if you follow your health plan's rules to the letter. Suppose you visit an in-network hospital for surgery your insurance provider preapproved. If an out-of-network anesthesiologist assists with the operation, you'll get a separate bill from that provider. Even if your insurance covers part of that bill, the anesthesiologist may "balance bill" you for the difference between what your insurance paid and what the provider charges.

An estimated 16% of in-network nonemergency facility stays for privately insured patients involve at least one out-of-network claim, according to a study by the Peterson Center on Healthcare and the Kaiser Family Foundation (KFF).

What Does the No Surprises Act Cover?

The new law covers medical services or items provided on or after January 1, 2022. Its protections vary depending on how you pay for health care.

If You Have Health Insurance

If you get health insurance through an employer, a health insurance marketplace or an individual plan directly from an insurance carrier, the new law prohibits:

  • Surprise bills for most emergency services, including out-of-network services or those the insurance carrier didn't authorize beforehand.
  • Providers from charging out-of-network cost-sharing (coinsurance or copay) rates for most emergency and some nonemergency services. The most they can charge is your in-network cost-sharing rate.
  • Out-of-network charges or balance billing for some additional services, such as anesthesiology or radiology, from out-of-network providers when you visit an in-network facility.

Medical providers and facilities must also give you a notice describing your billing protections and telling you whom to contact if you think they've violated those protections. The notice must explain that your billing protections can't be waived unless you're given advance notice and consent in writing to being charged more by an out-of-network provider.

One area the new law doesn't cover is ground ambulance services. Instead, the law requires a federal advisory committee to study this issue and make recommendations. Over half (51%) of emergency ground ambulance rides and 39% of nonemergency rides result in out-of-network charges, according to KFF.org.

If You Are Uninsured or Self-pay

People who don't have health insurance, or self-payers who have insurance but don't use it, must receive a good-faith estimate of medical costs from providers if they request it or after scheduling a medical item or treatment. In addition to the cost of the primary treatment, the estimate should include any other services to be provided at that time (such as blood tests, anesthesia or radiology).

Doctors and hospitals often work with other providers or facilities (co-providers or co-facilities) to care for you. For instance, after a knee replacement, your doctor may send you to a physical therapist to recover. Currently, the doctor isn't required to provide an estimate of what services from this co-provider will cost. (That will change in 2023.) However, you can ask the co-provider for a separate good-faith estimate.

What if You Still Get a Surprise Bill?

If you have insurance, your claim is denied as not covered, and you believe this violates the No Surprises Act rules, you can appeal the decision. Your insurance plan's documents and denial notices will explain how to ask for an external review of the decision.

Uninsured and self-pay patients should hold on to the paperwork for their good-faith estimates. If your bill is at least $400 more than the estimate, you can file a dispute. You must still have a copy of the estimate and must file within 120 days of the date on the bill.

Ways to Save Money on Medical Bills

Even a medical bill that's not a surprise can put the squeeze on your bank account. Try these tips to cut medical costs.

  • Understand your health insurance plan. Most health plans require using providers in the insurance network in order to receive full benefits. Getting in-network care and understanding how copays, coinsurance and deductibles work will help you get the most from your plan while minimizing costs.
  • Read your medical bills. Review both the bills you get from health care providers and the explanation of benefits (EOBs) you get from your insurer after receiving health care. Providers may overcharge you or bill you for something insurance should have covered. Spending some time on the phone to resolve the issue can save you substantial sums.
  • Negotiate with health care providers. Facilities and providers may be willing to negotiate if you can't pay a bill. They might split a large bill into monthly payments or let you settle a bill for less than the full amount. You may also receive discounts for paying upfront or demonstrating financial hardship.
  • Shop around. The No Surprises Act makes it easier for uninsured and self-paying patients to shop around for medical care. However, people using insurance can comparison shop too. Tools such as FairHealthConsumer.org let you compare the cost of various in-network providers and facilities so you can make a smart decision.
  • Use tax-advantaged savings plans. If you have a high-deductible health plan, consider opening a health savings account (HSA) to save pretax money for qualified medical expenses, including copays and deductibles. Contribute to a flexible spending account (FSA) if your employer offers one.

Protect Your Health and Your Credit

Unpaid medical bills are treated differently than other types of debt. Consumer credit bureaus—Experian, TransUnion and Equifax—know insurance companies can take time to pay, so they don't add unpaid medical bills to your credit history until 180 days after the bill is considered past due. This grace period doesn't mean you should ignore medical bills, however. Read bills immediately and act quickly to correct errors or file disputes. Checking your credit report regularly can help you keep tabs on any potential problems with unpaid medical bills and maintain the health of your credit score.