Can out of network physicians balance bill a patient in full?

This is typically desired by facility-based physicians who are looking to maximize revenue and do not have significant risk of losing referrals because the facility chooses provider, not the patient.  They include:

  • Anesthesia billing
  • Hospitalist billing
  • ER billing
  • Pathologist billing
  • Radiologist billing


Federal law

Some have mistakenly thought that the ACA protects against patients against balance billing out of network, but this is not the case.  It does require that health plans provide coverage and payment for emergency out of network services.  While this means that insurers must pay out of network emergency providers at rates similar to in network providers, it does not protect patients from the remaining balance.


State Laws

Until recently in most states there was no statutory law against balance billing a patient in full.  In fact, most efforts were on the part of insurers to try and get statutory and case law to force providers to balance bill in full, in order to reduce what they considered to be inducements or insurance fraud.



A state Supreme Court decision in 2008 prohibits balance billing by emergency physicians to patients that are under a managed care plan or Blue Cross or Blue Shield.  A new law in 2016 Ca. AB 72 bans balance billing by providers when performing services at contracted facilities and takes effect July 2017.  For example, when a patient sees a surgeon in a contracted facility, the anesthesiologist billing for their services who is out of network will now be regulated on their balance billing.



Colo. Rev. Stat. § 10-16-704 (3)(a)(I). Colorado also requires insurers to allow members to assign benefits to out-of-network providers. Colo. Rev. Stat. § 10-16-106.7.

Requires health insurers to hold their members harmless in emergency and surprise billing where the facility is contracted but the provider is not.  This means that the patient is not liable for balance billing, but the provider can still balance bill and it has to be resolved between the payer and the provider.  This means that insurers must typically allow the full charged rate of the OoN provider.  This however, does not mean that the insurer pays it all.  If a patient has a high unmet deductible, then the patient may still be responsible for an extremely large surprise balance.



Statute forbidding balance billing HMO patients for emergency services.  There is no protection for PPO patients that receive services out of network, either emergency or “surprise” claims.



Effective 2013, Illinois law now prevents surprise balance billing by facility-based providers for things like anesthesia billing where the physician is not contracted but the facility is contracted.



A prior law that protected HMO patients from balance billing from out of network providers was expanded to include protections for PPO enrollees in 2010.  This protects patients both from emergency and surprise bills from providers who perform services at a contracted facility.  There is an exception for physicians who are not hospital based where the patient did not assign benefits to the doctor and the doctor makes certain disclosures about the rate and balance billing.


New York

N.Y. Fin. Services Law §§ 601 to 608 (McKinney 2015); N.Y. Comp. Codes R. & Regs. tit. 23 § 200 (2014)

The NY law bans balance billing by providers in emergent situations.  It also extends the same protections to surprise balance billing where the patient was seen at a contracted facility by a non-contracted physician where the claim is assigned to the insurer.  This effectively means that in surprise billing situations the patient is immune from balance billing and the physician collects from the insurer.  The rate in this case is determined by the UCR as set by Fair Health.  The law also requires doctors performing procedures at a hospital and knows what other providers will be “in the room”, they must disclose this and whether that provider is contracted or not.



Texas law does not prevent balance billing by out of network providers for PPOs, although it does offer mediation if the bill is over $500 and a complaint resolution process.


So with the above noted exceptions, in most of the US it is still legal to balance bill a patient in full when out of network.


About Apache Health

Apache Health is a revenue cycle management (RCM) analytics, benchmarking, and auditing company.  The founders of Apache formerly ran a large RCM company that was acquired by a private equity group in a rollup.  Apache’s predictive analytics will benchmark billing performance and project exactly how much more revenue you should earn from your existing volume of patients. Using many factors and a blend of artificial intelligence and specialty specific benchmarks, the model projects whether changing the billing process would improve collections for your particular mix of procedures and payers.  Apache Health can help you evaluate whether to outsource the billing, determine which billing company to select to maximize performance, or track in-house billing performance improvement over time

Sean McSweeney

Apache Health



Legal disclaimer: Apache Health is engaged in the business of healthcare revenue cycle management analytics.  We offer information about regulations, rules, and industry practices relating to compliance.  Apache has researched that subject and has set forth the results of that research herein.  Apache Health is not a law firm and we do not offer legal advice.  Apache does not guarantee the completeness nor the accuracy of its research.  You should consult with your qualified healthcare attorney.