On December 27, 2020, President Trump signed into law the No Surprises Act, which was part of the consolidated appropriations bill intended to provide stimulus payments and other relief to individuals and businesses affected by the COVID-19 pandemic. The act comes after years of negotiation between health plan insurers, employers, and providers, and represents a significant change in the way that providers can bill and be reimbursed for “out of network” services.
The act is intended to eliminate surprise medical bills that are often received by patients from medical providers that are not part of an insurance plan’s preferred network of providers. This is often referred to as “balance billing” because the out-of-network provider bills a patient directly for the part of the bill that is not covered by insurance (the “balance”). Recently, some states have passed laws that attempt to eliminate such surprise bills, but state laws only apply to fully insured group medical plans and do not apply to some medical services that are governed exclusively by federal law. The passage of the federal law effectively applies balance billing rules to group medical plans that are not governed by state law — self-insured plans — and also to medical services such as air ambulances that are exclusively governed by federal law.
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