Balance Billing vs. Surprise Billing: What's Actually Illegal Under the No Surprises Act

What each one means

Balance billing is the broader category. Any time a provider sends you a bill for the gap between their charge and what your insurance paid, that's balance billing. For in-network providers, balance billing is almost always prohibited by the provider's contract with your insurer. The provider agreed to accept the negotiated rate as full payment when they signed up to be in-network.

Surprise billing is a specific subset: balance billing in scenarios the patient had no real ability to avoid. The classic example is the out-of-network anesthesiologist. You schedule a surgery at an in-network hospital with an in-network surgeon. The hospital assigns whichever anesthesiologist is on duty, who happens to be out-of-network with your insurer. Two weeks later you get a $3,200 bill from a doctor you never met. That's a surprise bill.

Another concrete example: you go to an in-network ER. The ER physician group is contracted separately and is out-of-network. The doctor who treats you sends a $1,800 balance bill on top of what the hospital charges. Pre-2022 this happened constantly; the No Surprises Act made it illegal.

Why this happens

Before 2022, surprise billing was a feature, not a bug. Out-of-network providers could charge whatever they wanted, insurers paid a fraction, and patients got stuck with the difference. State laws varied wildly. Some states had real protections, most didn't. Hospitals and physician groups built business models around it.

The No Surprises Act, effective January 1, 2022, established a federal floor. It does three main things. First, it prohibits balance billing for emergency services regardless of provider network status, anywhere in the country. Second, it prohibits balance billing for non-emergency ancillary services at in-network facilities. Third, it requires that the patient pay only their in-network cost-sharing amount in these scenarios. Providers and insurers settle the rest through arbitration. Provider penalties for violations can reach $10,000 per instance.

NSA applies to commercial group plans (including self-funded ERISA plans), individual marketplace plans, and Medicare Advantage. Excluded: short-term limited-duration plans and grandfathered plans. Medicare, Medicaid, TRICARE, VA, and IHS aren't covered by NSA either, but those programs have their own balance billing rules that are generally as strong or stronger.

NSA waivers exist but they're narrow. Out-of-network providers can ask you to sign a "notice and consent" form to waive your protections, but the waiver is only valid for non-emergency, non-ancillary services where you have a real choice of in-network providers. A waiver can never be used for emergency services, anesthesiology, pathology, radiology, neonatology, diagnostic labs, services from assistant surgeons or hospitalists or intensivists, or services where no in-network provider is available. If a provider obtained your signature on a waiver in any of these scenarios, the NSA protections still apply. The waiver is not enforceable, full stop.

The major loophole: ground ambulance is not covered by NSA. Air ambulance is. Congress carved out ground ambulance because the industry is fragmented across municipal, hospital-based, private, and volunteer services. A federal advisory committee delivered recommendations to Congress in August 2024, but Congress has not acted on them. As of early 2026, 22 states have passed their own ground ambulance protections, but state laws cannot reach self-funded ERISA plans, which cover roughly 63% of workers with employer-sponsored insurance.

What to do about it

Start by figuring out whether NSA actually applies to your situation.

Was the visit emergency? If yes, NSA almost certainly applies regardless of where you went or who treated you. Emergency services are protected even at out-of-network facilities and even with out-of-network providers.

Was it at an in-network facility? If yes, NSA applies to ancillary services from out-of-network providers (anesthesia, radiology, pathology, neonatology, labs, assistant surgeons, hospitalists, intensivists). It also applies to non-emergency services where you weren't given meaningful notice and a chance to choose in-network instead.

Was the provider out-of-network and were you given a real choice? If you were handed a notice and consent form moments before a procedure, in a stressful situation, with no realistic alternative, the consent is not valid. CMS has flagged this as a common abuse.

Did you sign an NSA waiver? If you signed one for emergency, ancillary, or unforeseen urgent services, it's not enforceable. The protections still apply.

If NSA applies and you're being balance-billed anyway, here's the sequence:

1. Call your insurer. Try this script:

"This claim from [date] should be processed under the No Surprises Act because [reason: emergency care, in-network facility with out-of-network ancillary, etc.]. Please reprocess at in-network cost-sharing rates and contact the provider to withdraw the balance bill."

2. Call the provider. Try:

"This service is protected under the No Surprises Act. I'm only responsible for my in-network cost-sharing amount, and the balance bill needs to be withdrawn. Please pursue resolution with my insurer through the federal arbitration process."

3. Don't pay the balance billed amount while the dispute is open. Pay your in-network cost-sharing, document the dispute in writing, and put the rest on hold pending resolution. Paying the disputed amount while contesting it makes recovery harder.

When to escalate

For NSA-protected scenarios, file with CMS or call the No Surprises Help Desk at 1-800-985-3059. CMS will review complaints and can refer them to enforcement agencies. Provider violations can carry penalties up to $10,000 per instance, which is real leverage.

For state-regulated insurance plans where state law provides additional protection, file with your state insurance department. Every state has an online consumer complaint process.

For self-funded ERISA plans, the Department of Labor's Employee Benefits Security Administration handles complaints at askebsa.dol.gov or 1-866-444-3272.

If a provider is pursuing collections during an active NSA dispute, that may itself be a violation. Document it and include it in your complaint.

Related reading

• What does CPT code 99285 mean? (And why your ER bill is so high)
• EOB shows a different amount than the bill: what's actually going on
• How to appeal a denied medical claim (with letter template)