As we build out our software to help payers and providers comply with price transparency legislation, we’re taking it upon ourselves to highlight and clarify some of the complexities of this new landscape. We’re currently decoding the No Surprises Act, the ground-breaking piece of legislation that was enacted in late 2020. Over the next few posts, we’ll be sharing some of our learnings.

First up, a brief summary of the No Surprises Act: what’s in this legislation, and why is it so significant?

Balance Bill Prohibition and Negotiation

Surprise balance bills are a top concern for Americans, with 2 in 3 people saying that they worry about unexpected medical bills. The Act addresses surprise balance bills for individuals in the following situations:

  1. Receiving emergency services and post-stabilization services from an out-of-network provider or at an out-of-network facility
  2. Receiving non-emergency ancillary provider (anesthesiologist, assistant surgeon, etc.) services from an out-of-network provider at an in-network facility

Once this legislation goes into effect on January 1, 2022, patients will no longer be responsible for balance bills. While there were several different proposals for how balance bills would be settled ranging from set rates to arbitration, the final rule requires that these bills be settled by provider-health plan negotiations, aided by an independent dispute resolution process if needed.

What does this negotiation process look like in practice? See below for a breakdown of the key steps.



Patient cost-sharing limitation

Health plans determine patient responsibility based on in-network rates and cost sharing (known as the Qualifying Payment Amount). Providers cannot bill beyond this amount.

Negotiation Period

A 30-day negotiation period begins on the day the provider receives a response regarding claim payment from the health plan. 

Independent Dispute Resolution (IDR) 

If an agreement on payment amount is not reached during the negotiation period, an Independent Dispute Resolution (IDR) process is initiated. Each party submits an offer and the IDR entity weighs several factors in their decision, ultimately selecting one of the two offers. The “losing” party whose offer does not get chosen pays for the arbitration fees.


Health plans must pay providers the agreed amount (reached either through negotiation or IDR) within 30 days of the decision. 

Details regarding the calculation of initial patient cost-sharing limitations were recently released in the interim final rule submitted to the Federal Registrar, and further details describing the IDR process will be released in a future regulation.

Turquoise Take: There's no question that this process generates an additional administrative workset for providers and health plans (much of which may get passed onto consumers through premiums). While the details of the IDR process have yet to be released, our hope - and prediction -  is that most parties will reach an agreement during the 30-day negotiation period and avoid the additional costs that come with the IDR process.

Additional Transparency Requirements

The No Surprises Act includes other transparency requirements beyond the surprise balance billing regulations that take us one step closer to consumers being able to shop for services with a clear idea of how much they may owe ahead of time. Most of these requirements fall on health plans and will involve implementation of new tools and processes. Here we describe four of the changes that will require more of the heavy lifting (with additional details on the other requirements available here).



Cost Estimates Shared by Provider

Providers must provide a good faith estimate of the expected charges for the item or service to the patient's health plan.

Advance Explanation of Benefits (EOBs)

Health plan must provide patients with an “Advance EOB” with estimates for the information that would be included in a typical EOB, including the provider’s estimated charges.

Provider Directory

Providers must share up-to-date network statuses with health plans, and health plans must maintain an accurate provider network directory.

Price-Comparison Tool

Health plans must offer tool for consumers to compare prices from in-network providers. 

Turquoise Take: While these new requirements may seem overwhelming at first, we believe health plans may already have a lot of the infrastructure in place to enable compliance with these regulations.

Key Takeaway

This is a major ruling; we still have to pinch ourselves to know that these regulations don't only exist in our own price transparency dreams. For decades healthcare costs have been notoriously opaque and unpredictable for patients, but these regulations along with the hospital and health insurance price transparency rules are ushering in a new era for our healthcare system. We’re honored to partner with payers and providers to make compliance with these regulations seamless.

Next up, we'll be shedding some light on which entities are subject to the No Surprises Act.

What other questions do you have about the No Surprises Act and other price transparency legislation? Send them to