7 No Surprises Act Billing Rules for Private Practices in the USA

What Is the Federal No Surprise Act?

The No Surprises Act is a federal law (effective January 1, 2022) designed to protect patients from unexpected medical bills, especially when they unknowingly receive out-of-network care. In simple terms, if your private practice provides services to patients with private health insurance, you can no longer bill patients for more than their in-network cost-sharing amounts in certain surprise billing scenarios.

Instead, insurance plans must cover out-of-network claims under those scenarios as if they were in-network, and balance billing the patient for the remainder is prohibited. These no surprises act billing rules apply to most commercial health plans (both employer-sponsored and individual plans) and cover a range of situations described below. (Patients with Medicare, Medicaid, TRICARE, or other federal coverage already have protections and are not subject to surprise bills.)

What Are the Rules for Private Practices to Avoid Surprise Billing Penalties?

Under the No Surprises Act regulations, providers and insurers have to resolve payment disputes between themselves, keeping patients out of the middle. The law set up an Independent Dispute Resolution (IDR) process for providers and health plans to negotiate and arbitrate fair payment for out-of-network services when needed. Meanwhile, patients are only responsible for their normal in-network copayment, coinsurance, or deductible amounts in protected scenarios. Failure to comply with these requirements can result in federal penalties up to $10,000 per violation for providers, so it’s critical for small practices to understand the rules and implement compliant billing practices.

For a complete overview of how to build compliant, efficient Medical billing processes, check out our Fundamentals of Medical Billing – Complete Guide.

Below, we break down the key components of the No Surprises Act billing rules, including when surprise billing protections apply, what Good Faith Estimates (GFEs) and new dispute resolution processes involve, what notices you need to give patients, and how to stay compliant. These guidelines will help independent physician practices and clinics adapt to the federal No Surprise billing compliance and avoid costly mistakes.

1. Protections Against Surprise Billing in Emergencies

One core aspect of the No Surprises Act billing rules is ending surprise bills for emergency services. If a patient comes to an emergency department or urgent care center (licensed for emergency care) and your practice or physicians provide care out-of-network, you cannot bill the patient beyond their normal in-network cost share for those emergency services. The patient’s health plan must cover the emergency care as if in-network, even if the hospital or doctors are not in the network, and the patient’s copay or deductible is all you can collect. This rule also extends to air ambulance transports (air ambulances cannot charge patients more than in-network cost-sharing). Ground ambulances are not covered by the federal law, however, and may still result in balance bills (ground ambulance billing is being addressed separately, not under this Act).

Emergency services include the initial emergency room or urgent care treatment, and also certain post-stabilization care. Post-stabilization services (continued care after an emergency, prior to discharge or transfer) are generally treated as emergency services under the law until the patient is stable enough to be transferred safely and consents in writing to transfer or out-of-network care. In practical terms, if one of your physicians is out-of-network and treats a patient in the ER (or is consulted for inpatient care immediately following an emergency), you must bill the patient’s insurance and accept the in-network rate (or negotiate with the insurer), rather than sending a big balance bill to the patient. Patients cannot be asked to waive their surprise billing protections in an emergency – no notice and consent exception is allowed for emergency services.

2. Out-of-Network Non-Emergency Services at In-Network Facilities

The No Surprises Act billing rules also protect patients receiving non-emergency care at in-network facilities when they’re unknowingly treated by an out-of-network provider. This scenario commonly leads to surprise bills – for example, a patient schedules surgery at an in-network hospital, but certain providers (such as the anesthesiologist, radiologist, or even a consulting specialist) are not in the patient’s insurance network. Under the new law, if your practice or physicians are out-of-network but working within an in-network hospital or ambulatory surgery center, you generally cannot bill the patient more than their in-network cost-sharing for those services. The patient is protected from the balance bill, similar to the emergency rule.

How the Payment Works

In other words, being at an in-network facility triggers surprise billing protections for the patient. The patient’s health plan will pay you (the out-of-network provider) a rate, and you can’t go after the patient for the difference. Instead, you would use negotiation or arbitration with the insurer if you feel the payment is insufficient (we cover the IDR process below). This rule applies to all out-of-network providers working at an in-network facility unless the provider follows a special notice and consent process with the patient (and unless the service is one of several that cannot be waived).

Ancillary Providers: No Waiver Allowed

Importantly, ancillary providers cannot use the notice-and-consent exception at all. The law defines certain specialties as “ancillary services” that are integral to a procedure and for which patients typically do not choose the provider. These include emergency medicine, anesthesiology, pathology, radiology, neonatology, and diagnostic services like radiology or lab work, as well as assistant surgeons, hospitalists, intensivists, and others involved behind the scenes. If your practice provides any of these services at an in-network facility, you are never allowed to balance bill the patient, even with consent. The patient is always protected; you must accept the plan’s payment and the patient’s in-network share.

Notice-and-Consent for Other Clinicians

For other types of out-of-network physicians (for example, a surgeon or consulting specialist not in the plan network), there is an option to bill out-of-network only if you obtain the patient’s informed consent in advance. The next section explains this Notice and Consent exception. If you do not obtain a proper consent or if the patient declines to sign it, then you must treat it like a protected scenario and refrain from balance billing.

Key Point for Small or Private Practices

If you are an out-of-network provider seeing a patient at an in-network hospital/ASC, you usually cannot bill the balance to the patient. Plan ahead – either ensure the patient’s protections are honored or use the official waiver process if permitted. Small practices that occasionally work in facility settings should develop a standard procedure to identify when a patient’s insurance is out-of-network and how to handle billing in compliance with the No Surprises Act billing rules.

3. Notice and Consent Exception for Out-of-Network Care

In limited non-emergency situations, the No Surprises Act billing rules allow an out-of-network provider to ask the patient to waive their surprise billing protections – but only if very specific conditions are met. This is referred to as the notice and consent exception.

Essentially, if a patient is willing to voluntarily pay extra to see an out-of-network physician at an in-network facility, and the service is eligible, the provider must give a standard notice and get signed consent at least 72 hours in advance (in most cases) in order to balance bill the patient.

When is notice-and-consent allowed?

It is never allowed for emergency services or for “ancillary” services like anesthesiology, pathology, radiology, etc. – those remain protected. It is only allowed for non-emergency, non-ancillary services provided at an in-network facility, where the patient has an alternative in-network option. For example, a surgeon who is not in the patient’s network could potentially use notice-and-consent if the patient could have chosen an in-network surgeon instead. If no in-network provider was available to perform the service, then the patient didn’t really have a choice and you cannot ask them to waive their rights in that scenario (the law prevents using notice-and-consent when no in-network alternative exists).

How to obtain proper consent?

The law requires using a Standard Notice and Consent form issued by the federal government, without modification. The form must clearly explain that the provider is out-of-network, include a good faith estimate of the charges for the services, and inform the patient of their right to refuse and seek care from an in-network provider. The notice and consent documents must be provided separately (not buried in other paperwork) and must be given with enough lead time:

• If the appointment or service is scheduled at least 72 hours in advance, the patient must receive the notice and consent at least 72 hours before the service date.
• If scheduled on shorter notice (less than 72 hours ahead), then the patient should get the notice on the same day of scheduling, and at least 3 hours before the service is provided.

The patient’s written consent should be obtained after they receive the notice and have time to review it. The consent is essentially the patient’s agreement to be treated out-of-network and pay whatever out-of-network charges are outlined. Patients must not be coerced – the consent has to be voluntary. (However, note that providers can refuse to treat the patient if they choose not to sign the waiver; the law doesn’t force a provider to proceed in-network rates in elective situations, it just protects patients from surprise bills if they don’t consent.)

Expert’s Tip

For your private practice, using the notice-and-consent exception will likely be rare and only practical if you know a patient truly understands the financial implications and still prefers an out-of-network service. If you do use it, be meticulous: use the official CMS form and fill in all required details (including a good faith estimate of charges), get it signed within the required timeframe, and give a copy to the patient. This documentation will be your protection if any billing dispute arises later. If the process is not followed to the letter, the patient cannot be billed more than in-network amounts.

4. Good Faith Estimates (GFEs) for Uninsured or Self-Pay Patients

Another major provision of the No Surprises Act billing rules is aimed at price transparency for patients who don’t have insurance or choose not to use it. Since January 1, 2022, all providers must give a Good Faith Estimate (GFE) of expected charges before providing services to any patient who is uninsured or paying for care themselves. This requirement applies across the board – no matter how small your practice or what specialty – if an uninsured or self-pay individual schedules an item or service, or even just requests an estimate, you are legally required to furnish a Good Faith Estimate of the likely costs.

What is a GFE?

It’s essentially a written estimate of the expected charges for a scheduled service or procedure. It should be clear, itemized, and include reasonably expected fees for all parts of the service. The idea is to inform patients upfront about what they will be expected to pay, so there are “no surprises” on the bill. According to the federal guidelines, a GFE for self-pay patients should include: a list of each service or item they will receive, the provider’s cash pay rate or expected charge for each, any applicable diagnosis or CPT codes, and the total expected cost (often covering a “period of care”, for instance the surgery and related pre- and post-op care). If multiple providers or facilities are involved in the service, ideally, the GFE should incorporate those as well (or those providers should supply separate GFEs). The Centers for Medicare & Medicaid Services (CMS) has provided a GFE template and instructions that practices can use to ensure they include all required information.

When and how to provide GFEs?

Timing is important. Regulations set specific deadlines based on when the service is scheduled:

• If a service is scheduled at least 10 business days in advance, you must provide the GFE within 3 business days of scheduling.
• If a service is scheduled at least 3 business days in advance (but fewer than 10 days out), you must provide the GFE within 1 business day of scheduling.
• If an uninsured patient just requests an estimate (without scheduling yet), you should also provide it within 3 business days of the request, even if no date is set.

The GFE should be given in writing (paper or electronically) and be written in a clear, easy-to-understand manner. Make sure to document that it was provided. Small practices might integrate this into their scheduling workflow: for example, when a self-pay patient calls to schedule a procedure, your staff could input the services into your billing system and generate the estimate letter that day or the next.

CMS has indicated flexibility during the initial implementation – for instance, they are exercising enforcement discretion about including other providers’ estimates in a single GFE – but you should make a good-faith effort to be as comprehensive and accurate as possible. There is no standardized format mandated, but the model GFE template from CMS is a helpful starting point. It ensures you include disclaimers about the estimate not being a bill, and the patient’s rights (such as the new dispute process if the final bill is much higher).

5. Patient-Provider Dispute Resolution (PPDR) for Excess Charges

What happens if you give a Good Faith Estimate, but the actual bill ends up being much higher? To protect uninsured patients from egregious discrepancies, the No Surprises Act billing rules created a Patient-Provider Dispute Resolution (PPDR) process. If a self-pay patient receives a final bill that exceeds the GFE by $400 or more for any specific item or service, the patient has the right to initiate a dispute to determine a fair amount. In other words, a significant overshoot of the estimate can be challenged and brought before an independent arbiter.

For example, say your clinic provided a GFE of $1,000 for a set of services, but complications arose and you end up billing $1,600. If any particular listed service ended up $400+ above the estimate, the patient could file a dispute. The PPDR process is administered by HHS through a portal. An independent dispute resolution entity (different from the insurance IDR) will ask you to justify the higher charges, perhaps by showing that the patient requested additional services or that unforeseen circumstances occurred, and they will decide whether the patient should pay the full difference or a reduced amount. There is a small administrative fee for the patient to file (to prevent frivolous claims), but it’s refundable if they prevail.

For private practices, the takeaway is: strive for accurate estimates and clear communication. If something changes (e.g. during a procedure, you realise additional services are needed that will cost more), it’s wise to inform the patient and even consider updating the GFE if possible. While unexpected clinical situations can happen, you want to avoid surprises in cost. Keep documentation of why any additional charges were necessary in case you need to defend them. Remember that the burden is on the provider to show why the extra cost was warranted. If you over-bill uninsured patients without justification, not only can an arbiter reduce your allowed charge, but your practice could face penalties or be required to refund the difference.

6. Independent Dispute Resolution (IDR) Between Providers and Insurers

While patients are now shielded from many surprise bills, the question remains: how do out-of-network providers get paid, and how much? The No Surprises Act billing rules set up an Independent Dispute Resolution (IDR) system for providers and health plans to resolve payment disputes for surprise billing situations. This is sometimes called a “baseball-style” arbitration. It’s only used after the provider and insurance plan have tried to negotiate first.

Here’s how it works in brief:

When you (an out-of-network provider) submit a claim to the patient’s health plan for a service covered by the No Surprises Act and balance billing ban 2025 (say an out-of-network surgery at an in-network hospital, or an ER visit), the health plan will make an initial payment or denial. If you are not satisfied with the amount the insurer will pay, you must first enter a 30-business-day open negotiation period with the insurer to try to agree on a rate. This is essentially an informal settlement window – you and the payer can discuss and attempt to find a middle ground. There’s even a standard form to initiate this open negotiation.

• If you reach an agreement with the insurer in that period, great the claim is resolved at the agreed amount.
• If you do not reach an agreement by the end of 30 business days, then either party can initiate IDR within 4 business days. At that point, you and the insurer will submit your final offer amounts for payment to a certified independent arbiter (an IDR entity) along with supporting information. The arbiter will then choose one of the two amounts – whichever they deem most appropriate given the circumstances – and that decision is binding on both parties. (This “winner-take-all” approach incentivizes both sides to submit a reasonable offer.)

There are rules on what factors the IDR entity can consider. Initially, the law and regulations emphasize consideration of the qualifying payment amount (QPA) – essentially the insurer’s median in-network rate for that service in the area – as a guideline. However, providers can submit evidence that maybe the case is unusual (patient acuity, provider experience, market share, etc.) to argue for a higher amount. Recent legal challenges and rule updates have tweaked the IDR process, but as a small practice, the main point is: you have a path to challenge insufficient payments, but it requires time and potentially paying an arbitration fee.

Expert’s Tip

For many small physician practices that rarely go out-of-network, you might not need to use IDR often, if ever. If you are typically in-network with major plans or you choose to accept the initial payments as adequate, you won’t trigger this process. But if you do find yourself underpaid for a surprise-bill protected service, know that you can initiate a dispute. Keep an eye on deadlines – the 30-day negotiation and 4-day arbitration request windows are strict. Also, consider the amount at stake versus the cost of arbitration (in 2023, IDR fees ranged from ~$350 to $700 per dispute). It might be worth it for large bills, but not for small differences.

(The AMA and other organizations have published guides for physicians on using the IDR process. Also, CMS maintains a list of certified IDR entities and a portal for initiating disputes. If you use a medical billing service, ensure they are prepared to handle open negotiations and potential IDR filings on your behalf.)

7. Disclosure and Notice Requirements for Providers

Under the No Surprises Act billing rules, providers and facilities must inform patients of their rights and protections against surprise billing compliance. Every provider or clinic that is covered by these rules needs to make a Disclosure Notice available to patients. Specifically, you must post a one-page notice (the government provides a model) that explains the latest No Surprises Act updates protections and how to contact appropriate agencies if a patient believes their rights were violated. 

This notice should be publicly posted in your office (e.g. in a waiting room or check-in area) and on your practice website, if you have one. In addition, you need to give each patient who is scheduled for a service that falls under the surprise billing protections a copy of this disclosure notice, no later than the time you request payment or send the bill for the service. (CMS guidance says it doesn’t necessarily have to be included with the bill itself, but it does need to be provided around that time.)

The model disclosure notice from HHS/CMS is an easy way to comply. It’s basically a standard document titled “Patient Protections Against Surprise Billing” that you fill in with your contact info. It informs patients that they are not to be balance billed in certain situations, lists the dollar amounts (in-network rate) they are responsible for, and explains how to report if someone is wrongly billed. Using the model notice (without altering the required language) is recommended to ensure you hit all the points. You can find this model notice on the CMS No Surprises Act billing rules website or through medical associations.

For small practices, complying with the disclosure rule can be as simple as: printing out the one-page notice and taping it up in your office, adding the text or PDF to your website (perhaps on your billing or patient resources page), and having a process to include the notice in either the intake packet or with the first invoice for applicable patients. If your practice never sees patients in hospital or ASC settings, and only in your office, the law technically requires the notice if you are providing services to patients covered by the Act (which you likely are if you see commercially insured patients). The AMA has noted that if you don’t work in a hospital or facility setting at all, you may not have to furnish the notice individually to every patient – but since many private practices do have some hospital affiliation or simply to be cautious, it’s wise to incorporate it for all. It’s a relatively easy requirement, and it demonstrates transparency to your patients.

Penalties and Enforcement

Surprise billing compliance is not optional – there are real penalties for violations. Federal regulators (the Centers for Medicare & Medicaid Services, working with the Department of Labor and Treasury) can impose civil monetary penalties up to $10,000 per violation on providers or facilities that knowingly violate the balance billing protections. For example, if a practice improperly bills a patient $5,000 for an out-of-network surgery that should have been protected (and doesn’t reimburse promptly after being notified), that could trigger a penalty. Each instance is considered separately, so multiple improper bills could multiply the fines.

That said, the government has also outlined a process for providers to avoid the penalty in certain situations by quickly correcting the mistake. If a provider learns they billed a patient in error under a surprise billing scenario, they can reverse the charges and refund the patient (with interest) within 30 business days; by doing so, they may not be assessed the $10,000 penalty in that case. The intent is to encourage providers to promptly self-correct if a surprise bill slips through.

Enforcement is a combined federal and state effort. Some states have their own surprise billing laws and enforcement mechanisms. “The updated billing rules for providers allow states to enforce the federal No Surprises Act regulations within their jurisdiction, and if they don’t, HHS will intervene.” Patients are empowered to file complaints about surprise billing issues via a federal hotline or online portal. As a small practice, any complaint could lead to an investigation, so it’s best to be proactive and demonstrably compliant. Keep documentation (like signed consent forms, copies of GFEs, etc.) as evidence that you followed the rules.

Beyond government penalties, there’s also the reputational and legal risk. Balance billing a patient when it’s not allowed can lead to significant patient anger, loss of trust, negative publicity, or even legal action. It’s far better to get your billing right upfront.

Summary of penalties:  Up to $10K fines per violation for balance billing or not providing required estimates/notices, potential additional sanctions if patterns of non-compliance are found, and the requirement to refund patients for any wrongfully collected amounts. Health plans have their own penalties too (e.g., they must update provider directories and such or face fines, but that’s on the payer side). For your practice, focus on adhering to the rules, and you won’t need to worry about these penalties.

Conclusion

The No Surprises Act billing rules represent a significant shift in medical billing practices, aiming to remove financial “surprises” for patients and make healthcare costs more transparent. For private practices in the USA, understanding and complying with these billing rules is now a part of doing business.

In summary, emergency and in-network facility services must be treated as in-network for billing purposes (unless a proper waiver is obtained in the limited cases allowed), good faith estimates must be given to self-pay patients, and new dispute resolution avenues (both patient-provider and provider-payer) must be respected to resolve any disagreements. Additionally, practices need to inform patients of their rights through clear disclosures and follow forthcoming regulations like the AEOB requirements as they roll out.

While it may feel burdensome at first, compliance with the No Surprises Act is doable with careful planning. By educating your team, updating your procedures, and possibly leveraging outside physician billing services expertise, you can integrate these requirements into your practice’s workflow. Doing so not only avoids legal penalties but also builds trust with your patients – they will appreciate a transparent and fair billing process with no nasty surprises.