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Consumers feel ambushed by surprise medical bills, despite law

By John Rossheim | NerdWallet

The No Surprises Act, billed as protection for patients against surprise medical bills, went into effect on New Year’s Day 2022. But has the federal law actually curbed healthcare costs at high out-of-network rates, as well as certain forms of billing? part of the provider’s costs not covered by insurance?

The preliminary report on the new law is decidedly mixed.

Health insurers are trumpeting the number of surprise bills the law prevents, but are concerned about the potential burden of claims litigation.

Analysts believe the law was written to provide substantial consumer protection, but they have not yet seen enough data to assess compliance.

Healthcare consumers give a lower score, according to a June poll by Morning Consult. One in five respondents said they had received an unexpected medical bill in the first half of the year, the poll found. But it’s unclear how many of those surprises — if any — should have been blocked by the limited protections of the No Surprises Act.

“It is very difficult to find out whether the law is actually being implemented, because the problem is: are consumers not getting surprise bills?

Expert on site

Patricia Kelmar | director of healthcare campaigns at US PIRG

The law prevented more than 2 million potential surprise bills from reaching commercially insured patients between January 1 and February, according to a statement from AHIP, an insurance industry trade group. But analysts still have their doubts.

“It is very difficult to find out whether the law is actually being implemented, because what matters is: its consumers not surprise bills,” said Patricia Kelmar, director of healthcare campaigns at US Public Interest Research Groups, a national federation of consumer organizations.

Observers’ doubts about the effectiveness of the law are compounded by low consumer awareness of the new protections. In June, only 16% of adults said they had seen, read or heard anything about the No Surprises Act, according to the Morning Consult survey. Consumers who do not know the law do not know their rights if providers and insurers do not comply.

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The complexity of the law — mainly in the form of exceptions that allow out-of-network charges and balance billing in certain circumstances — raises further questions. “Not everything that patients think is a surprise bill is covered by the NSA,” said Loren Adler, deputy director of the University of Southern California-Brookings Schaeffer Initiative for Health Policy. Urgent care, for example, does not receive the legal protection for urgent care.

Does the new law work?

It may be too early to measure the effectiveness of the new consumer protections, and federal agencies are not releasing statistics. The Centers for Medicare & Medicaid Services, or CMS, and the Department of Health and Human Services have not responded to requests for data on consumer complaints about violations of the No Surprises Act.

“It’s a little hard to know, but I understand that mistakes are made from time to time,” said Karen Pollitz, a senior fellow and co-director of the patient and consumer protection program at KFF, a news and policy agency for the health care organization. “If a mistake is made, it’s up to the consumer to figure out what to do next, and this shouldn’t have worked that way.”

Other observers are pleased with the law’s overall performance. “The No Surprises Act works pretty well,” says Adler. “It doesn’t solve every problem in the healthcare system and there are still a few sources of surprise bills.”

How the law should protect you

The protections of the No Surprises Act are broadest in the emergency room, where patients are most vulnerable and least able to verify that all of their clinicians are in their insurer’s network.

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“Most surprise medical bills go to emergency services,” says Pollitz. “There are no exceptions in the emergency room. Anyone touching you or your imaging is required to send their claims directly to your health plan first — before they bill you — to find out your in-network cost-sharing amount. If they don’t, there’s a $10,000 fine for every time they screw up.”

Hospitals are also excluded from balance billing for post-stabilization care, services provided by a department after a patient has received emergency care.

The new law also protects against out-of-network and balance billing for non-urgent care, but with several exceptions. For example, if your in-network doctor orders tests from an out-of-network lab, the lab may still charge you for the difference between in-network and out-of-network rates.

The No Surprises Act provides several consumer protections if you don’t use insurance. “If you’re paying out of pocket or don’t have insurance, you’re entitled to a good estimate up front,” says Kelmar. “This gives consumers the opportunity to cut back and plan financially for medical treatment.”

If you are asked to waive your rights under the No Surprises Act, think carefully before agreeing to what may be unlimited financial liability. If you do sign and later regret it, you can still get redress. Providers should not ask patients to waive protection if an in-network provider is not available, if there are unexpected urgent medical needs, or for certain support services.

What to do if you receive an unexpected bill?

How do you feel about a carrier cost that significantly exceeds your plan’s network coverage? You may need help figuring out what’s behind the charge. “This could be a mistake, or it could be providers still trying to take advantage of sending you a balance bill,” says Kelmar.

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You can try calling CMS’s No Surprises Help Desk at 800-985-3059; the service will tell you how to file a dispute or complaint in any state. Help is available in English and other languages. “CMS is supposed to figure out who should resolve each complaint,” says Pollitz.

It’s important to note that CMS has two processes for consumers who disagree with carrier bills:

  • If you use health insurance and believe you are being charged more than your plan’s in-network rate for physicians or services covered by the No Surprises Act, you may file a complaint.
  • If you are uninsured or choose not to use your insurance and have been charged more than $400 by the provider, you can dispute an account.

Under the No Surprises Act, your state has chosen one form of enforcement:

  • Some states implement the law themselves.
  • Other states relinquish enforcement to federal agencies.
  • Still other states work with federal agencies on enforcement.

The No Surprises Help Desk should be able to tell you how enforcement works in your state.

Adler suggests another premise: “If you get an unexpected bill from a provider, your insurer is your first recourse; they risk losing their license if they don’t comply.”

Pollitz proposes another way: state Consumer Tools, or other state or federal agencies that assist consumers with insurance matters. “Consumers should reach out to anyone they feel can help them,” she says.

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John Rossheim writes for NerdWallet. E-mail: USexpansion@nerdwallet.com.

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