No Surprises Act Part 1
It’s safe to say the majority of us have seen a doctor or been to the emergency department at one time or another. Something you probably took into consideration when choosing where to get your medical care, is who is in-network with your insurance policy. After all, no one wants to pay more because of an out-of-network provider! However, things aren’t always so simple, as is the case in the following scenario:
Suzie saw Dr. Smith, an orthopedic specialist at ABC Ortho. Prior to her appointment, she made sure that ABC Ortho is in-network with her insurance plan. A few weeks later Suzie received her EOB showing a much higher cost than she anticipated, because her claim processed as out-of-network. She called her insurance company, explaining that she checked the network status before making the appointment, when they dropped the bomb: yes ABC Ortho is in-network, but Dr. Smith is not. The total charge for her visit was $250, of which, her insurance allowed $200. Now, instead of her insurance plan paying 80% of the charge ($160), they will only pay 60% ($120) because that’s her out-of-network benefit. Suzie is caught off-guard and very unhappy about this - instead of the $40 she was expecting, she’ll now be paying $80. When the bill arrived from ABC Ortho, it showed Suzie’s insurance did in fact pay 60% ($120); however, her total responsibility is $130, which is $90 more than she originally expected to pay! Unfortunately this in not a mistake, it’s balance-billing. Because Dr. Smith is an out-of-network provider, he is under no obligation to accept that $50 contractual adjustment processed by Suzie’s insurance company, and he can pass that cost off to her.
Believe it or not, this happens frequently and in numerous healthcare settings, resulting in additional, unexpected expenses. According to an article published by the Centers for Medicare and Medicaid Services (CMS):
“Two-thirds of all bankruptcies filed in the United States are tied to medical expenses. Researchers estimate that 1 out of every 6 emergency room visits and inpatient hospital stays involve care from at least one out-of-network provider, resulting in surprise medical bills. And a 2019 study by the Government Accountability Office (GAO) found that the median price charged by air ambulance providers ranged from $36,400 to more than $40,000, and over 70% of these transports were furnished out-of-network, meaning most or all costs fell to the insured individual alone.”
Enter the No Surprises Act, slated to go into effect January 1st, 2022. This new rule will take balance-billing out of the equation, while providing patients with more cost transparency, as well as peace of mind.
For more information on the Act, refer to the link below. And be sure to check back for our upcoming post, No Surprises Act Part 2, in which we’ll explain the impact on additional billing practices.