What Is No Surprises Act?
The No Surprises Act is a federal law effective January 1, 2022, that protects patients from surprise medical bills when they receive emergency care or are treated by out-of-network providers at in-network facilities. The law requires insurers and providers to resolve billing disputes through an independent dispute resolution process rather than billing the patient for the difference between in-network and out-of-network rates.
Key Facts
- Before the No Surprises Act, 1 in 5 emergency room visits and 1 in 6 in-network hospital stays resulted in at least one surprise out-of-network bill, with average surprise bills ranging from $750 to $2,600
- The law covers all emergency services regardless of network status, plus non-emergency services at in-network facilities when the patient didn't have the opportunity to choose an in-network provider (such as anesthesiologists, radiologists, and pathologists)
- The independent dispute resolution (IDR) process has handled over 490,000 disputes in its first two years, with arbitrators splitting roughly evenly between insurer and provider positions
- Patients are held harmless under the law — they pay only in-network cost-sharing amounts (copays, coinsurance, deductibles) regardless of how the dispute between insurer and provider resolves
- The Good Faith Estimate provision requires providers to give uninsured or self-pay patients a written cost estimate before scheduled services — if the final bill exceeds the estimate by $400 or more, patients can dispute it
What Does the No Surprises Act Protect Against?
The law addresses three scenarios that previously generated surprise bills:
- Emergency services: All emergency care is now treated as in-network regardless of the provider's actual network status. Patients pay only their in-network cost-sharing amount. This applies to emergency rooms, freestanding emergency departments, and air ambulances.
- Non-emergency care at in-network facilities: When a patient goes to an in-network hospital but receives care from an out-of-network provider they didn't choose — such as an anesthesiologist, assistant surgeon, radiologist, or pathologist — the patient is protected from balance billing.
- Air ambulance services: Air ambulance providers cannot balance bill patients beyond in-network cost-sharing. Ground ambulances are notably excluded from the law's protections.
How Does the Dispute Resolution Process Work?
When a provider and insurer disagree on payment, neither can bill the patient for the difference. Instead:
- Open negotiation: The provider and insurer have 30 days to negotiate a payment amount.
- IDR initiation: If negotiation fails, either party can initiate independent dispute resolution within 4 days.
- Arbitration: A certified IDR entity reviews both offers ("baseball-style" — each side submits one final offer) and selects one. The arbitrator considers the qualifying payment amount, provider training, market share, patient acuity, and prior contracted rates.
- Payment: The losing party pays the arbitration fee (currently $350-$500 per dispute).
What Is the Good Faith Estimate?
For uninsured or self-pay patients, the law requires a new transparency tool:
- Providers must give a Good Faith Estimate (GFE) of expected charges before any scheduled service.
- The GFE must include all items and services reasonably expected — facility fees, provider fees, lab work, anesthesia, etc.
- If the actual bill exceeds the GFE by $400 or more, the patient can initiate a patient-provider dispute resolution process.
- This provision applies to all healthcare services, not just those covered by the surprise billing protections.
What the Law Does Not Cover
Important gaps remain. Ground ambulances are excluded — a major gap given average ground ambulance bills of $450-$1,200 with high out-of-network rates. The law does not cap overall healthcare costs, out-of-pocket maximums, or insurance premiums. It does not prevent providers from sending large bills for in-network services that hit patients' deductibles. And it does not address the underlying cost drivers that make healthcare the largest source of household financial distress in America.
State-by-State Variations
Many states had their own surprise billing laws before the federal No Surprises Act. State laws that provide greater consumer protection than the federal law remain in effect. The federal law serves as a floor, not a ceiling.
| State | Key Difference |
|---|---|
| New York | Pioneered surprise billing protections in 2015 with the Emergency Medical Services and Surprise Bill Law. State law covers ground ambulances (which the federal law does not) and uses a different dispute resolution methodology. |
| California | AB 72 (2017) banned surprise billing for non-emergency services at in-network facilities. State law uses a payment standard based on average contracted rate or 125% of Medicare, which may differ from federal IDR outcomes. |
| Texas | SB 1264 (2019) banned surprise medical bills for most state-regulated plans. Mediation-based dispute resolution. Covers freestanding emergency rooms, which are more common in Texas than most states. |
| Florida | HB 221 (2016) provided limited surprise billing protections for emergency services. The federal No Surprises Act significantly expanded protections for Florida patients, especially for non-emergency out-of-network situations. |
| Georgia | SB 359 (2020) banned surprise billing and created a dispute resolution process. State law covers ground ambulances — a key gap in the federal law that Georgia filled. |
Frequently Asked Questions
Does the No Surprises Act apply to all health insurance plans?
The law applies to most private health plans including employer-sponsored plans (both self-funded ERISA plans and fully insured plans) and individual/marketplace plans. It does not apply to Medicare, Medicaid, TRICARE, VA, or Indian Health Service — those programs have their own billing rules.
What should I do if I receive a surprise medical bill?
Contact your insurer and the provider's billing department. Reference the No Surprises Act. If the bill is for emergency services or out-of-network care at an in-network facility, you should only owe in-network cost-sharing. File a complaint with CMS at 1-800-985-3059 if the provider won't comply.
Are ground ambulances covered by the No Surprises Act?
No. Ground ambulances are the most significant gap in the law. Average ground ambulance bills range from $450 to $1,200, and out-of-network rates are common. Some states (New York, Georgia) cover ground ambulances under their own laws. A federal advisory committee is studying this gap.
What is a Good Faith Estimate and who gets one?
Uninsured or self-pay patients have the right to a written cost estimate before any scheduled healthcare service. If the final bill exceeds the estimate by $400+, patients can dispute it through a federal process. Ask any provider for a GFE before agreeing to treatment.
Can I still get a large medical bill under the No Surprises Act?
Yes. The law prevents surprise OUT-OF-NETWORK bills, but does not cap in-network costs. If you receive in-network care, you still owe your deductible, copays, and coinsurance. A $10,000 hospital stay with a $5,000 deductible still costs you $5,000 — the law doesn't change that.