No Surprises Act

What it is

The No Surprises Act is a federal surprise billing law that took effect in 2022 for most group health plans and health insurers offering group or individual coverage. It protects patients from large, unexpected out-of-network bills in certain settings and requires providers to give good faith estimates of expected charges to uninsured and self-pay patients.

The core protections apply to emergency services and to non-emergency services by out-of-network clinicians at in-network facilities, plus most air ambulance services. The law also creates dispute resolution processes: patient-provider dispute resolution when a self-pay bill exceeds the good faith estimate by a set threshold and independent dispute resolution between payers and providers for certain out-of-network claims.

The law does not change Medicare or Medicaid billing, since those programs already have separate balance-billing protections. It primarily affects commercial and employer plans, plus how out-of-network pricing and patient financial responsibility are handled.

Why it matters operationally

For revenue cycle teams, the No Surprises Act is not theoretical. It changes who can be balance-billed, what cost sharing you can collect, and how you handle expected charges upfront. If staff continue to bill patients the "old way" on protected claims, the organization risks refunds, complaints to regulators, and civil monetary penalties.

The law also affects how payers adjudicate certain out-of-network claims. Plans apply specific cost-sharing rules and may auto-adjust line items or reduce patient responsibility to match in-network levels when the protections apply. If your system is configured with standard out-of-network benefits and you do not recognize protected scenarios, balances in your practice management system will not match what the payer is legally allowed to collect, which leads to over-collection, refunds, and potential audit exposure.

On the front end, registration, scheduling, and clinical teams must identify when a good faith estimate is required for uninsured or self-pay patients, including ongoing therapy and recurring behavioral programs. Missing or incomplete estimates are not just a compliance issue. They directly drive patient disputes, slower collections, and reputational risk if charges come in far above what patients expected.

How it shows up in billing and documentation

In billing workflows, the No Surprises Act shows up in three main ways: identifying protected encounters, matching patient cost sharing, and generating compliant good faith estimates.

Operationally, you must:

• Flag encounters that are emergencies or that involve out-of-network clinicians at in-network facilities, since those are subject to NSA protections.
• Configure your patient responsibility rules so protected claims do not apply standard out-of-network deductibles and coinsurance when the law requires in-network cost sharing.
• Produce and store good faith estimates for uninsured and self-pay patients before scheduled services, including for recurring behavioral health visits and long treatment episodes.

On the payer side, some remittances use specific remark codes to indicate NSA-related adjustments or to explain why the payer reduced patient cost sharing to in-network levels. Your team needs to recognize when lower patient responsibility is correct under the law versus when it reflects an underpayment. Documentation of notice-and-consent forms, facility network status, and GFE details becomes critical backup for any disputes with payers, regulators, or patients.

• Treating all out-of-network behavioral health stays as fully balance-billable and sending large patient statements after an emergency psychiatric admission at an in-network hospital, even though the No Surprises Act requires in-network cost sharing only.
• Failing to generate a good faith estimate for a self-pay IOP episode that is scheduled for several weeks, then billing significantly more than what the patient expected and ending up in a patient-provider dispute process and refund situation.
• Building EHR and PM rules that automatically set patient responsibility on out-of-network claims based solely on plan benefits, without checking if NSA protections apply, which leads to over-collection from patients and forced write-offs when compliance flags the error.
• Assuming the No Surprises Act applies to every state Medicaid or managed Medicaid plan and changing your Medicaid balance-billing rules incorrectly, which causes under-collection where standard Medicaid cost-sharing is still allowed.
• Not training front-desk and intake staff on when notice-and-consent exceptions are allowed, so patients are either asked to sign invalid consents in emergency-like situations or never given the option in legitimate non-emergency out-of-network scenarios.

Behavioral health is heavily exposed to the No Surprises Act because many programs are out-of-network or rely on complex carve-out arrangements. Emergency psychiatric evaluations, detox in hospital settings, and crisis stabilization in in-network facilities with out-of-network psychiatry or therapy groups are exactly the kind of encounters where surprise bills have historically occurred and that the law is designed to prevent.

For residential treatment, PHP, and IOP, the impact is more detailed. The main NSA protections often do not apply if the facility itself is fully out-of-network and not functioning as an in-network hospital or emergency department, but the good faith estimate rules apply broadly to uninsured and self-pay behavioral health care. That includes recurring therapy, long per-diem residential stays, and extended IOP or PHP episodes, so your estimates must cover the full expected course of treatment, not just the first week.

Carve-out behavioral health plans and Medicaid MCOs introduce another layer of complexity. Many Medicaid programs already ban balance billing and are technically outside the NSA scope, but patients and staff rarely understand those distinctions. Your team needs payer-by-payer guidance on when protections are coming from the No Surprises Act, from state surprise billing laws, or from Medicaid rules to set the right expectations and prevent both under- and over-collection.

Concurrent authorization and utilization review workflows also intersect with the law. When a payer covers only part of a long behavioral stay and denies later days as not authorized, your instinct may be to bill the patient for every denied per-diem. Under NSA and related protections, you must first confirm whether those days fall in a protected context and whether any part of the denial can legally shift to the patient.

AI can help with No Surprises Act compliance by classifying encounters and checking cost-sharing logic against known rules. An agent can read benefit details, network status, facility type, and place of service, then flag visits that look like protected emergency or in-network facility encounters where out-of-network balance billing is risky. The same agent can generate draft good faith estimates for self-pay or uninsured patients by pulling fee schedules, expected length of stay, and typical service patterns for a given program.

Supabill uses agents to read every 270/271, 837, and 835 to compare payer adjudication against configured NSA and state-surprise-billing rules, and to surface claims where patient responsibility looks too high given the context. A Supabill documentation agent like Supanote can pre-fill GFE templates from your scheduled episodes and clinical plans. Human leaders still have to interpret grey areas, stay on top of changing federal and state guidance, and decide when to escalate to legal or compliance, since AI cannot set organizational risk tolerance or argue detailed disputes with regulators.

Which behavioral health services are protected by the No Surprises Act?

The strongest protections apply to emergency services and to out-of-network clinicians working at in-network facilities, which can include emergency psychiatric care and hospital-based behavioral units. All uninsured and self-pay behavioral health patients are also entitled to a good faith estimate for scheduled services, even if the main surprise billing protections do not apply. Source

Does the No Surprises Act apply to Medicaid behavioral health?

The federal No Surprises Act does not generally apply to traditional Medicaid, since Medicaid already bans balance billing and has its own rules. Many state Medicaid and managed Medicaid programs have similar or stronger protections, so you still need to follow state and Medicaid rules about what, if anything, you can bill to the patient. Source

Do I need a good faith estimate for weekly therapy or IOP?

Yes, if the patient is uninsured or chooses to self-pay, you must provide a good faith estimate before scheduled services, including recurring therapy, IOP, PHP, or residential stays. The estimate should reflect the expected total charges for the full anticipated course of treatment, not just the first visit or first week. Source

What happens if my behavioral health bill is much higher than the good faith estimate?

If an uninsured or self-pay patient receives a bill that is at least a set threshold higher than the good faith estimate, the patient can start a patient-provider dispute resolution process. You may have to justify the higher charges or reduce them, so accurate and carefully documented estimates are important. Source

Does the No Surprises Act change how I get paid by commercial plans?

It can, especially for out-of-network emergency and facility-based services, because the plan may pay you based on formulas tied to median in-network rates rather than your full billed charges. You still submit claims as usual, but payment amounts and patient cost sharing may look different from pre-NSA out-of-network patterns. Source

• CMS, No Surprises Act