Available Resources for Privately Insured Patients Facing Surprise Balance Bills 

Originally reported on KFF.ORG: https://www.kff.org/health-costs/issue-brief/what-resources-are-available-for-privately-insured-patients-who-get-surprise-balance-bills/ 

For patients with private insurance, surprise medical bills can result from high deductibles or “balance billing.” Typically, health plans negotiate payments with in-network providers, but out-of-network providers may bill patients directly for the difference between the in-network payment and the full charge, known as “balance bills.” This leaves patients liable for the balance in addition to any deductible, coinsurance, or copay. 

The No Surprises Act, effective from 2022, aims to eliminate many of these balance bills. This act protects privately insured patients, including those with employer-based coverage, non-group plans, and grandfathered plans, from certain surprise balance bills. It mandates private health plans to cover out-of-network claims and apply in-network cost-sharing (deductibles, copayments) for specific covered benefits. The law also prohibits certain providers, hospitals, and air ambulances from issuing surprise balance bills for out-of-network care, unless the patient consents beforehand. 

Protection Under the No Surprises Act 
The No Surprises Act ensures that plans and providers remove patients from common payment disputes. However, patients might still encounter balance bills due to billing errors, non-covered services, or if the health plan denies the claim entirely as not covered. Patients might receive bills if their plan incorrectly processes a claim or applies out-of-network cost-sharing when it shouldn’t. Errors might occur if the plan doesn’t recognize a claim as subject to the No Surprises Act or due to billing oversights. 

Patients can appeal these mistakes using their plan’s internal claims and appeals procedure. Federal law grants patients the right to appeal a health plan denial, known as an adverse benefit determination (ABD), which includes decisions to apply the incorrect cost-sharing amount. Patients have at least 180 days to file an internal appeal after an ABD, and for post-service claims, the plan must complete the appeal within 60 days. If the plan upholds its denial, patients can request an independent external appeal for No Surprises Act compliance issues. 

Addressing Incorrect Bills 
Patients who receive surprise bills must first identify that the plan’s decision was incorrect and that the bill falls under the No Surprises Act. According to KFF polling, 78% of Americans know little about the new consumer protections, limiting self-advocacy effectiveness. Health plan ABDs must include contact information for state consumer assistance programs (CAPs), which can help file an appeal. Consumers can contact CAPs to assess whether their bill is valid. Additionally, the Centers for Medicare and Medicaid Services (CMS) offers resources for reviewing medical bills via their website or the No Surprises Help Desk. 

Collection and Appeals 
While patients appeal, no federal rule prevents providers from collecting the outstanding bill. Out-of-network providers might bill the patient for the full charge during the appeal. Patients unable to pay the bill might be referred to collection agencies, despite guidelines from the Consumer Finance Protection Bureau (CFPB) against coercive practices. KFF polling found that 41% of adults have health care debt, impacting their financial stability. 

If the patient prevails in the appeal, the health plan must reprocess the claim according to the No Surprises Act, and the out-of-network provider must refund any excess amount collected. 

Penalties for Incorrect Billing
Under the Affordable Care Act and the No Surprises Act, federal agencies can impose penalties on health plans and providers for incorrect billing. Plans can be fined up to $100 per day per affected beneficiary, and state regulators may have additional enforcement tools. Providers face penalties up to $10,000 per violation, potentially resulting in significant fines. Patients must successfully lodge complaints with federal regulators for penalties to be imposed. 

Awareness and Legal Recourse
Most patients are unaware of the new protections and available resources for incorrect medical bills. Patients should inquire about costs ahead of time and contact their health plan if they receive an unexpected bill. Federal resources allow patients to submit complaints, but the process does not provide a determination or assist in disputing bills with the payer. 

Plans and providers can arbitrate out-of-network care payment disagreements via the No Surprises Act’s independent dispute resolution process. Most payment determinations favor providers, who are also filing lawsuits against the act. The federal government has proposed changes to streamline the dispute resolution process, but patients must be held harmless for surprise, out-of-network balance bills. 

Patients should not receive surprise balance bills unless there’s a mistake or the bill is not protected. Though recourse options exist, they are only effective if patients are aware of them. 

Find & Flag Hidden Errors in Your Medical Bills 
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Originally reported at https://www.kff.org/health-costs/issue-brief/what-resources-are-available-for-privately-insured-patients-who-get-surprise-balance-bills/