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New federal billing requirements apply to all emergency settings, including hospital emergency departments, and to air ambulance services.

Guidance on Federal Surprise Billing Legislation Released

By Haley Nicholson | July 13, 2021 | State Legislatures News | Print

Recently, the U.S. Departments of Health and Human Services, Labor and the Treasury, along with the Office of Personnel Management, issued an interim final rule restricting excessive out-of-pocket costs to consumers from surprise and balance medical billing. The rule, “Requirements Related to Surprise Billing: Part I,” is part of the implementation of the No Surprises Act passed at the end of last year.  

Surprise billing can happen when people unknowingly receive medical care from providers outside their health insurance plan network. Balance billing happens when a provider charges a patient the remainder of a medical bill that his or her insurer does not pay.

The interim final rule:

  • Bans surprise billing for emergency services. Such services, regardless of where they are provided, must be treated on an in-network basis without requirements for prior authorization.
  • Bans high out-of-network cost sharing for emergency and nonemergency services. Patient cost sharing, such as coinsurance or a deductible, cannot be higher than if such services were provided by an in-network doctor, and any coinsurance or deductible must be based on in-network provider rates.
  • Bans out-of-network charges for ancillary care (for an anesthesiologist or assistant surgeon, for example) at an in-network facility in all circumstances.
  • Bans other out-of-network charges without advance notice. Health care providers and facilities must provide patients with a plain-language consumer notice explaining that patient consent is required to receive care on an out-of-network basis before that provider can bill at the higher out-of-network rate.

The requirements apply to all emergency settings, including hospital and freestanding emergency departments and to post-stabilization and air ambulance services—but not ground ambulances. An advisory committee will be created to discuss how ground ambulance services could be covered. Providers must also give notice to patients about state and federal surprise billing protections along with information on how to contact state and federal agencies if a consumer receives a surprise medical bill.  

These changes will extend similar protections to Americans who are insured through employer-sponsored commercial health plans known as Employee Retirement Income Security Act of 1974 plans, with the Labor Department retaining control over them. The changes will take effect on Jan. 1, 2022, with additional rules forthcoming.

Haley Nicholson is senior policy director, health, in NCSL’s State-Federal Program.

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