What Is Balance Billing? Surprise Medical Bills Explained
Balance billing (surprise billing) occurs when you're charged the difference between a provider's fee and what insurance pays. Learn your protections under the No Surprises Act.
What Is Balance Billing?
Balance billing (also called "surprise billing") occurs when a healthcare provider bills you for the difference between their charge and the amount your insurance pays. For example, if a doctor charges $1,000 but your insurance only pays $600, the provider might bill you the remaining $400 "balance." This typically happens with out-of-network providers, often in situations where you couldn't choose your provider—like emergency care or when an out-of-network specialist treats you at an in-network hospital.
The No Surprises Act: Federal Protection
The No Surprises Act, effective January 2022, provides significant protection against surprise medical bills. The law covers emergency services, non-emergency services at in-network facilities from out-of-network providers, and air ambulance services. Under this law, you can only be charged your in-network cost-sharing amount (copay, coinsurance, deductible) in protected situations.
- Emergency services at any facility, including after stabilization
- Non-emergency care at in-network hospitals from out-of-network providers
- Air ambulance services from out-of-network providers
- Applies to most employer-sponsored and individual health plans
- Providers must give you a good faith cost estimate for scheduled services
When Balance Billing Is Still Legal
The No Surprises Act doesn't cover all situations. You can still be balance billed when you knowingly choose an out-of-network provider for non-emergency care, when you receive care at out-of-network facilities (except emergencies), for ground ambulance services (not covered by federal law), or if you sign a consent form waiving your protections (which providers cannot require for emergency care).
State Balance Billing Laws
Many states have additional balance billing protections beyond federal law. Some states cover ground ambulances, have lower out-of-pocket limits, or extend protections to self-funded employer plans. States like California, New York, and Texas had surprise billing laws before the federal act and may provide stronger consumer protections.
- California: Comprehensive protection since 2017, covers HMOs and PPOs
- New York: Strong emergency room protections, independent dispute resolution
- Texas: Mediation process for bills over $500, covers most plan types
- Florida: Protections for emergency services and surgical procedures
- Check your state's insurance department for specific protections
Good Faith Estimates for Uninsured Patients
If you're uninsured or paying out-of-pocket, you have the right to a Good Faith Estimate before receiving scheduled care. Providers must give you this written estimate, and if the final bill exceeds it by $400 or more, you can dispute the charges through an independent process. This applies to all healthcare providers, including hospitals, physicians, and labs.
How to Dispute a Surprise Bill
If you receive a balance bill you believe violates your rights, don't pay it immediately. Start by reviewing your EOB to understand what insurance paid. Then contact your insurance company to verify the claim was processed correctly. File a complaint with your state insurance department or the federal government. You can also initiate the independent dispute resolution process under the No Surprises Act.
How to Fight a Surprise Medical Bill
Review the bill and your EOB
Compare the bill to your Explanation of Benefits. Note whether the provider is in-network or out-of-network and whether the service should be protected under the No Surprises Act.
Document the circumstances
Record when and where you received care, whether it was an emergency, and if you had any choice in provider selection. Note if you signed any consent forms waiving protections.
Contact your insurance company
Call the number on your insurance card and ask them to review the claim. Request they process it as in-network if it qualifies for No Surprises Act protection.
Notify the provider
Send a written letter (keep a copy) stating you believe the bill violates balance billing laws. Reference the No Surprises Act and request they adjust the bill to your in-network cost-sharing amount.
File complaints if needed
File complaints with your state insurance department and CMS (Centers for Medicare & Medicaid Services) at 1-800-985-3059. You can also initiate independent dispute resolution through the federal process.
Frequently Asked Questions
What is balance billing?
Balance billing occurs when a healthcare provider bills you for the difference between their charge and what your insurance pays. This often happens with out-of-network providers and is commonly called a "surprise bill."
Is balance billing legal?
It depends on the situation. The No Surprises Act prohibits balance billing for emergency services, non-emergency care from out-of-network providers at in-network facilities, and air ambulances. However, it's still legal when you knowingly choose out-of-network care.
What is the No Surprises Act?
The No Surprises Act is a federal law effective since January 2022 that protects patients from unexpected medical bills in emergency situations and when receiving care from out-of-network providers at in-network facilities.
How do I know if I'm protected from balance billing?
You're protected if you received emergency care, non-emergency care from an out-of-network provider at an in-network facility without consent to waive protections, or air ambulance services. Check your EOB and contact your insurer to verify.
Can I be balance billed for emergency room visits?
No. Under the No Surprises Act, you cannot be balance billed for emergency services, including care you receive after being stabilized until you can be safely transferred or discharged.
What should I do if I receive a surprise medical bill?
Don't pay immediately. Review your EOB, contact your insurance company, and notify the provider in writing that you believe the bill is protected under balance billing laws. File complaints with your state and federal regulators if needed.
Got a Surprise Medical Bill?
Upload your bill and we'll analyze whether it violates the No Surprises Act and help you dispute it effectively.
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