No Surprise Billing Act Billing Errors That Lead to Compliance Risks
Discover common No Surprise Billing Act billing errors that trigger compliance risks and learn how Billing Care Solutions helps providers stay compliant.
One of the most regulated areas in healthcare is medical billing. Small errors can cause big financial and legal repercussions. The No Surprise Billing Act is one of the most significant laws impacting billing in today’s world. This law was designed to keep patients from being faced with surprise medical bills, particularly when they get care from providers they didn’t know would be out-of-network.
Healthcare providers and billing staff must comply with this law. Serious consequences of violations include significant penalties, audits, and loss of patient trust. However, a lot of those providers are still committing billing mistakes that could lead to compliance problems. This article identifies the most frequent billing mistakes under the No Surprise Billing Act, discusses the consequences of these mistakes, and how Billing Care Solutions assists providers to remain fully compliant.
What Is the No Surprise Billing Act?
No Surprise Billing Act is effective January 1, 2022. It was enacted in the Consolidated Appropriations Act of 2021. The primary purpose of this law is to shield patients from being unexpectedly placed with large medical bills from out-of-network providers, especially in emergency situations.
Prior to this legislation, patients would go to an in-network hospital, and receive the service from an out-of-network provider, like an anesthesiologist or radiologist, without realizing it. This led to an unexpected surprise bill of thousands of dollars. The No Surprise Billing Act (NSBA) eliminated this practice by establishing a clear set of rules for providers and insurers.
Under this law, providers must:
- Notify patients about their network status before treatment
- Provide a Good Faith Estimate for uninsured or self-pay patients
- Follow the Independent Dispute Resolution process for billing disagreements
- Limit patient cost sharing to in-network amounts in most cases
Failing to follow any of these rules is a direct path to compliance risk.
Why Billing Errors Under This Act Are So Costly?
Non-compliance isn’t only about a fine. A violation of No Surprise Billing Act could lead to the consequences such as:
- Civil monetary penalties of up to $10,000 per violation.
- Penalties imposed by the states in addition to federal penalties.
- Compulsory reimbursements to over-billed patients.
- Full Audits on a Complaint basis.
- Loss of trust in insurance networks, patients.
Such consequences are not to be taken lightly. One billing error can cause a ripple effect that impacts your whole revenue cycle. For small and mid-sized practices, this can be financially damaging. The No Surprise Billing Act doesn’t leave a lot of leeway for providers. That’s why it’s crucial to be aware of the most common errors.
Common No Surprise Billing Act Billing Errors Providers Make
Here is a table of the most common No Surprise Billing Act compliance risks associated with the most common billing errors observed:
| Billing Error | Description | Compliance Risk Level |
|---|---|---|
| Missing Good Faith Estimate | Not providing cost estimates to uninsured patients | High |
| Incorrect Network Status | Billing patient as out-of-network incorrectly | High |
| Incomplete AEOB | Failing to send Advanced Explanation of Benefits | High |
| Exceeding Cost Sharing Limits | Charging more than the in-network cost share | Critical |
| Skipping the IDR Process | Not following dispute resolution steps | High |
| No Prior Notice Given | Not informing patients of out-of-network providers | Medium to High |
| Wrong Balance Billing | Sending a balance bill that violates federal law | Critical |
All of these errors relate directly to the No Surprise Billing Act requirements. Let’s examine the most significant ones in more detail.
Failing to Provide Good Faith Cost Estimates
The No Surprise Billing Act requires providers to give uninsured and self-pay patients a Good Faith Estimate before scheduled services. This estimate should contain the charges for any and all items and services that are associated with the visit.
If the final bill is $400 or more over the Good Faith Estimate, the patient can dispute the bill. Many providers do not provide this estimate or do not provide a complete estimate. Both are billing errors and compliance risk.
Incorrect Out-of-Network Status on Claims
A common billing mistake is when a provider is identified as in-network when they should be out of network, or the reverse. This mistake will directly affect the amount the patient pays. Most emergencies and some non-emergencies under the No Surprise Billing Act will not allow patients to be billed for anything more than their in-network cost sharing.
Missing or Incomplete Advanced Explanation of Benefits
AEOB is a document that insurers need to provide to patients prior to scheduled services. It requires that providers be able to provide accurate billing information to insurers. If information is given incorrectly or not at all by providers, AEOB becomes incorrect. This is a violation of the No Surprise Billing Act requirements.
Billing Beyond the Allowed Cost Sharing Amount
This is among the worst mistakes. When a provider bills a patient more than the allowed cost-sharing amount under the No Surprise Billing Act, it is considered balance billing the patient. This can lead to compulsion to refund and severe fines.
Not Following the Independent Dispute Resolution Process
When there is a payment disagreement between a provider and an insurer, the No Surprise Billing Act requires both parties to use the Independent Dispute Resolution process. This is a formal procedure that is handled by a certified IDR entity. Failure to do so, or failure to meet deadlines would constitute a violation which contributes to compliance risk.
Departments Most Vulnerable to Billing Act Violations
The No Surprise Billing Act has created an increased risk of billing errors for certain departments. These include:
Emergency Care Departments
There is the possibility of multiple providers being involved in an ED, some of whom may be out-of-network. The No Surprise Billing Act covers emergency billing. Providers are not allowed to charge patients more than in-network rates for Emergency Care services, regardless of whether the provider is in or out of network.
Anesthesiology and Radiology
These are two departments that are often mentioned in surprise billing complaints. Patients may be treated by an anesthesiologist or radiologist who they did not select. The No Surprise Billing Act prohibits these providers from charging patients out of network rates without their consent.
Air Ambulance Services
The No Surprise Billing Act includes air ambulance billing. This is a high risk area as the charges tend to be high and the patient does not have a choice in the care used. There can be massive financial penalties if the billings are incorrect here.
How These Errors Create Serious Compliance Risks
It is important to understand that billing errors do not just cause financial loss. They also damage the relationship between patients and providers. Here is how common errors lead to compliance risks:
Improper Balance Billing Triggers Violations
When a provider sends a bill that goes against No Surprise Billing Act protections, the patient has the right to file a complaint with the Department of Health and Human Services. Each complaint can lead to a separate investigation. This means multiple violations can be stacked, increasing the total penalty amount.
Missing IDR Deadlines Adds More Risk
The IDR process is time sensitive. Failure to meet a deadline by a provider can result in a lack of recourse for them to challenge the payment amount. This may lead to receiving lower reimbursement or fines.
Documentation Gaps Increase Regulatory Scrutiny
Documentation is one of the biggest compliance issues. When a provider can’t show they provided proper notice, issued a Good Faith Estimate, or adhered to the proper billing process, regulators can presume a violation has occurred. Well-documented is the first line of defense.
How to Prevent No Surprise Billing Act Billing Errors?
To avoid the errors in billing, there should be a clear system, and trained employees. These are the best actions that providers can take:
Train Staff on Act Requirements Regularly
All individuals involved with billing need to know about the No Surprise act and its requirements. This can encompass front desk workers who take in patient data, billers who handle claims and coders who determine billing codes. The team is regularly trained to ensure that they stay aware of any changes in regulations.
Use Technology to Automate Compliance Checks
New No Surprise Billing Act compliant billing software can help identify any errors before they get filed. Automated alerts that trigger when Good Faith Estimates are not submitted, status is not correct, or the cost-sharing is incorrect decrease the risk for human error.
Conduct Regular Internal Billing Audits
To minimize compliance risks, many providers opt to outsource their medical billing to a professional medical billing company. This is particularly helpful when practices don’t have a compliance team.
How Billing Care Solutions Supports Compliance?
Billing Care Solutions is a medical billing and coding company with extensive knowledge in regulatory compliance. The team is aware of the breadth of No Surprise Billing Act, and uses that knowledge to all claims.
Services include:
- Correctly verifying the status of the network before claim is submitted
- Correct and accurate issuing and tracking of Good Faith Estimates
- Cost sharing limits are monitored in real time.
- Rising to the occasion during the IDR process (when required)
- Detailed audit safeguard documentation.
Providers who leverage an outsourced billing cardio service like Billing Care Solutions can mitigate compliance risk, enhance revenue cycle efficiency, and much more.
Benefits of Outsourcing to a Billing Expert
Having a trusted billing partner means providers can concentrate on patient care, with experts taking care of the compliance aspect. This means fewer claims will be denied, reimbursements can be made quicker and risk of penalty is reduced.
Conclusion: Stay Compliant and Avoid Costly Billing Errors
The No Surprise Billing Act was created to safeguard patients against surprise bills. For providers, it establishes guidelines that they need to adhere to when they bill and document. Failure to adhere to these rules, either deliberately or unintentionally – can result in significant compliance issues. With the proper systems and know-how, the most common billing problems (such as not having a Good Faith Estimate, network status is incorrect, balance billing is improper, or IDR was not followed) can be avoided.
Billing Care Solutions ensures healthcare providers can confidently manage the No Surprise Billing Act. Whether you need to submit accurate claims or maintain comprehensive audit protection, the team’s team is ready to help keep your practice compliant, efficient, and financially sound. For assistance with No Surprise Billing Act compliance, contact Billing Care Solutions today and get started on error-free medical billing.
