A patient goes to an in-network hospital in an emergency. They receive care, recover, and return home expecting their insurance to process the visit the way it normally would. Then a bill arrives from an out-of-network provider they did not choose, for an amount they did not expect.
That is the kind of situation the No Surprises Act was designed to address.
For healthcare providers, hospital revenue-cycle teams, billing managers, and compliance officers, the No Surprises Act is not just a patient billing rule. It affects how certain balances are calculated, communicated, disputed, and collected. It also matters well before an account is placed with a collection agency.
If a balance is protected by the No Surprises Act, or if the amount owed has not been reviewed properly, collection activity can create compliance risk, patient frustration, and reputational harm.
A strong medical debt collection process should confirm that patient balances are accurate, collectible, properly documented, and not restricted by federal or state surprise billing protections.
What Is the No Surprises Act?
The No Surprises Act is a federal law that protects many patients from certain unexpected out-of-network medical bills. At its core, the law helps keep patients out of payment disputes between providers and insurers.
In simple terms, the No Surprises Act limits when patients can be balance billed. It applies in situations where a patient may have had little or no control over who provided their care, or where they reasonably expected their care to be treated as in-network.
The law generally applies to most emergency services, certain non-emergency services provided by out-of-network providers at in-network facilities, and out-of-network air ambulance services. It also includes good faith estimate requirements for uninsured or self-pay patients. If the final bill is substantially higher than the good faith estimate, the patient may have access to a patient-provider dispute resolution process.
In covered situations, the patient’s financial responsibility is generally limited to the applicable in-network cost-sharing amount. Any remaining payment dispute is typically handled between the provider, facility, plan, or issuer. In limited situations, notice and consent rules may apply if a patient is asked to waive certain protections.
For patients, the law is about protection from unexpected bills. For healthcare organizations, it is about making sure the right balances are billed, documented, and collected. For providers and revenue-cycle teams, the practical point is straightforward: before an account is pursued for collection, the organization should understand whether the balance may be affected by No Surprises Act protections.
Who Does the No Surprises Act Apply To?
The No Surprises Act applies to many patients with group health plans or individual health insurance coverage, including coverage through the Health Insurance Marketplace. It also includes certain protections for uninsured and self-pay patients through good faith estimate requirements.
But the law does not apply to every medical bill or every patient balance.
Coverage depends on the type of service, the facility, the provider’s network status, the patient’s health plan, and the circumstances of the care. For example, many emergency services may be protected. Certain out-of-network services at an in-network facility may also be protected. Out-of-network air ambulance services are included as well.
At the same time, some balances may fall outside the law’s protections. Ground ambulance services are not covered in many situations. Some services may not be included in the surprise billing protections. In certain cases, a valid notice and consent process may apply. Patients may also still owe legitimate cost-sharing amounts under their plan.
Because the details matter, providers should review accounts carefully before sending them to collections. A balance that looks collectible at first glance may need additional review if network status, notice and consent, good faith estimates, or state surprise billing rules are involved.
When Did the No Surprises Act Start?
The main consumer protections under the No Surprises Act took effect on January 1, 2022.
The law was enacted in December 2020 as part of federal appropriations legislation. In 2021, federal agencies issued interim rules and implementation guidance. Beginning January 1, 2022, major surprise billing protections became effective. Since then, federal processes related to good faith estimates, patient-provider disputes, and independent dispute resolution have continued to develop.
For collection purposes, the effective date matters because accounts involving services provided after the applicable compliance date may need No Surprises Act review before collection activity begins.
It also matters because surprise billing compliance is not static. Providers, facilities, plans, issuers, and collection partners should continue monitoring federal and state updates.
How the No Surprises Act Affects Medical Debt Collections
Medical debt collection depends on the accuracy and collectability of the underlying balance. That is why the No Surprises Act matters so much to collection workflows.
If a patient is billed more than the law allows, then collection activity based on that balance may be challenged. The issue may become more than a billing correction. It can lead to disputes, complaints, compliance concerns, credit reporting issues, and damage to patient trust.
This is why providers should review accounts for possible No Surprises Act coverage before placement. Patient responsibility should be calculated correctly. Notice and consent documentation should be reviewed when relevant. Uninsured and self-pay accounts should be checked for good faith estimate concerns. Disputed balances should be flagged before collection activity continues.
A collection agency should not be expected to fix incomplete upstream billing processes after the fact. The strongest approach is for providers and collection partners to work from accurate, reviewed, well-documented account information before outreach begins.
When a Medical Debt May Be Risky to Collect Under the No Surprises Act
Some accounts raise red flags that should pause collection activity until the balance is reviewed.
For example, an out-of-network emergency balance may need review if it appears to exceed the patient’s in-network cost-sharing responsibility. A non-emergency charge from an out-of-network provider at an in-network facility may also require additional review. The same is true for out-of-network air ambulance claims, patient disputes involving surprise billing, or self-pay accounts where the final bill is much higher than the good faith estimate.
Missing documentation is another warning sign. If the account lacks clear information about network status, notice and consent, patient responsibility, or applicable state protections, the provider and collection partner should proceed carefully.
In these situations, the question is not simply whether the patient has an unpaid balance. The question is whether that balance was calculated and billed in a way that complies with the law.
Building No Surprises Act Review Into the Revenue Cycle
No Surprises Act compliance should be built into the revenue-cycle process before accounts are placed for collection.
That starts with identifying whether the service may be covered. Emergency services, out-of-network care at an in-network facility, and out-of-network air ambulance services should receive careful review. Teams should confirm provider, facility, and plan network status at the time of service.
The patient responsibility amount should also be validated. If the patient is only responsible for an in-network cost-sharing amount, the account should reflect that. If notice and consent was used, the organization should confirm that it was allowed, required, and properly documented.
For uninsured or self-pay patients, good faith estimate requirements should be reviewed when applicable. If the patient has already disputed the balance, submitted a billing complaint, raised an insurance issue, or requested financial assistance, that information should be considered before placement.
Collection partners also need the right documentation. The more clearly a provider can share account status, dispute information, balance validation, and compliance flags, the easier it is for the agency to handle the account accurately.
A strong review process helps protect patients, reduce disputes, and supports better collection outcomes.
FAQs
What is the No Surprises Act?
The No Surprises Act is a federal law that protects many patients from certain unexpected out-of-network medical bills. It limits balance billing in covered situations, including many emergency services, certain out-of-network services at in-network facilities, and out-of-network air ambulance services. It also includes good faith estimate protections for uninsured and self-pay patients.
Who does the No Surprises Act apply to?
The No Surprises Act applies to many patients with group health plans or individual health insurance coverage. It also includes protections for uninsured or self-pay patients through good faith estimate rules. Coverage depends on the service, provider status, facility status, plan type, and patient circumstances.
When did the No Surprises Act start?
The main No Surprises Act protections started on January 1, 2022. Providers, facilities, plans, issuers, and collection partners should continue monitoring federal and state updates because implementation guidance and related requirements continue to evolve.
Choose a Healthcare Collection Partner That Understands Compliance
No Surprises Act compliance does not end when an account leaves the billing department. If a balance is sent to collections, the provider and collection partner should both understand whether the account has been reviewed for surprise billing restrictions, patient disputes, good faith estimate issues, and applicable state requirements.
IC System helps healthcare organizations recover past-due accounts while treating patients with professionalism and respect. Our healthcare collection approach is built around compliance, communication, and protecting the provider-patient relationship.
Contact IC System Healthcare to learn how we can support your revenue recovery efforts.
Disclaimer: The information provided in this article is for general informational purposes only and does not constitute legal advice. State, local, and industry-specific regulations may prohibit or limit certain practices. Always consult qualified legal counsel before implementing new collection strategies.