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Ban on Surprise Medical Bills Included in COVID-19 Stimulus Package

Jan 05, 2021 Decorative image

On December 27, 2020, President Trump signed the Consolidated Appropriations Act of 2021 (also known as the COVID-19 relief bill) into law. Included in this bill is the No Surprises Act, a ban on surprise medical bills, which takes effect beginning in 2022.

Surprise Medical Bills

Surprise medical bills occur when patients unexpectedly receive care from out-of-network healthcare providers. For example, a patient may go to an in-network hospital for treatment, such as surgery or emergency care, but an out-of-network doctor may be involved in the patient’s care.

Patients often cannot determine the network status of these providers during treatment in order to avoid the additional charges. In many cases, the patient is not involved in the choice of provider at all.

No Surprises Act

The No Surprises Act applies to surprise bills from doctors, hospitals and air ambulances. It will prohibit these providers from billing patients who have health coverage for unpaid balances. Rather, providers will have to work with the group health plan or health insurance issuer to determine the appropriate amount to be paid by the plan or issuer, under the methodology provided in the Act.

The Departments of Health and Human Services, Labor and the Treasury will work together to issue regulations regarding this methodology and other requirements of the Act.

Effective Date

The Act requires implementing regulations to be issued no later than July 1, 2021. The provisions of the No Surprises Act are to apply to plan or policy years beginning on or after January 1, 2022.

More Information

Hylant will continue to monitor this law as additional information becomes available on the details of the law. Reach out to your Hylant representative for further information.

The above information does not constitute advice. Always contact your employee benefits broker or trusted adviser for insurance-related questions.