The recent push for price transparency in healthcare, primarily driven by the No Surprises Act (NSA), established new federal requirements for cost estimates. This legislation aims to protect consumers from unexpected medical bills by requiring providers to furnish projected charges before services are rendered. The mechanism for this protection is the Good Faith Estimate (GFE), which applies to scheduled non-emergency items and services. Understanding who is entitled to this estimate is essential for navigating the current healthcare billing landscape.
Defining the Good Faith Estimate and Scope
A Good Faith Estimate (GFE) is a document detailing the expected charges for a patient’s scheduled healthcare item or service. The estimate must include the primary service and any reasonably expected ancillary services provided by co-facilities or co-providers, such as anesthesia or lab work. The GFE is primarily intended for individuals who are uninsured or who choose to pay for their care without involving their insurance plan, known as “self-pay.” Providers and facilities are required to issue this estimate directly to the patient, either upon request or when a service is scheduled.
Timing Requirements
The GFE must be provided in writing, either on paper or electronically, and includes details like the service description, diagnosis codes, and the list of expected charges. If a service is scheduled at least 10 business days in advance, the GFE must be provided within three business days of scheduling. For services scheduled three to nine business days out, the provider must furnish the estimate within one business day.
When Insured Patients Qualify for a GFE
Insured patients who intend to use their health plan benefits generally do not receive a Good Faith Estimate directly from their healthcare provider. The provider’s obligation to issue a GFE directly is focused on the uninsured or self-pay population. However, an insured individual qualifies for a GFE if they explicitly choose not to submit a claim to their health insurance for a specific service. In this scenario, the patient is treated as “self-pay,” and the provider must furnish the GFE under the same rules that apply to an uninsured individual.
The Insured Patient’s Estimate: Advanced Explanation of Benefits
When an insured patient uses their health coverage, the mechanism for price transparency is the Advanced Explanation of Benefits (AEOB), which is the responsibility of the health plan. To generate the AEOB, the healthcare provider must first send a Good Faith Estimate of the billed amounts to the patient’s health plan. The plan uses this information to create the AEOB, which is more detailed than a standard GFE. The AEOB includes cost-sharing information like deductibles, co-pays, co-insurance, and specifies whether the provider is in-network or out-of-network. For services scheduled at least 10 business days in advance, the patient should receive the AEOB within three business days of the plan receiving the GFE data.
Patient Protections When Bills Exceed Estimates
For uninsured or self-pay patients who receive a Good Faith Estimate, the No Surprises Act protects against excessive billing. If the final billed charges are “substantially in excess” of the GFE, the patient can challenge the bill. The threshold for this is when the total billed amount is $400 or more above the estimated total. This difference allows the patient to initiate the formal Patient-Provider Dispute Resolution (PPDR) process. The PPDR involves an independent third party reviewing the bill and the GFE to determine the appropriate payment amount.