Prepare for New Surprise Billing Rules

Providers should prepare for new surprise billing rules slated to take effect next year under the No Surprises Act.

Starting January 1, 2022, healthcare providers can’t charge patients more than the in-network cost-sharing for out-of-network services. There will also be an arbitration mechanism for settling unanticipated expenses.

The No Surprises Act passed in December 2020 addresses surprise medical bills and will affect healthcare providers.

Patients only pay the in-network cost-sharing amount for out-of-network anesthesiologists at in-network hospitals.

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“The payer and the provider would have 30 days to negotiate a settlement before moving to arbitration,” the report adds.

The “final offer” arbitration process is a significant change for healthcare providers and payers. They must make an offer to a third party to solve the surprise billing dispute. A third-party arbitrator makes a final decision based on contracted rates and patient knowledge.

“The losing side is responsible for paying administrative costs, which may influence when organizations decide to pursue arbitration, as payers and providers are loath to increase those parts of their budgets,” HRI stated.

Providers and payers

Providers and payers will also need to consider their operational readiness for the law, consumer outreach efforts, and negotiation strategy, HRI adds.

Being operationally ready is critical to successful implementation. Healthcare providers and payers need to improve their analytics to avoid balance billing under the new surprise billing law. Staff may need extra training, and external vendors may be necessary for arbitration and administrative tasks.

In terms of consumer outreach efforts, providers and payers should consider expanding out-of-network mitigation strategies to prevent surprise billing situations and create a consumer education strategy to bolster knowledge about networks and benefits.


The latter strategy is critical to building patient trust, which is a “key element of payer and provider response” to the No Surprises Act, according to HRI.

“As they grow accustomed to retail interactions that focus on stellar customer experience, consumers may expect more clarity around prices,” the report states. “Payer and provider education efforts should focus on adding more clarity for consumers, on helping build long-term trust that strengthens member and patient relationships.”

Obtaining patient consent for out-of-network services with higher costs is crucial, and effective communication is critical. To achieve successful negotiations, healthcare providers must adopt a data-driven approach that utilizes the latest pricing information and takes advantage of hospital price transparency regulations.


Hospitals and payers must disclose pricing information online. This data can inform market intelligence and strategies in response to the No Surprises Act. (Source: HRI report)

Providers can make better decisions about arbitration when they have access to pricing information. This is because there is a risk of manipulation of rates or networks by providers or payers.

(Note from your Revenue Cycle Management partner at ebix, Inc. We are always at the forefront of industry insights and believe this by Jacqueline LaPointe of announcement will interest you.)

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