Unexpected medical bills top the list of health care costs that Americans fear they will not be able to afford. Many patients across the country are receiving surprise medical bills from health care providers that they thought would be fully covered by their health insurance. Many of these bills come from providers the patient could not have reasonably chosen at the time they were treated (such as in an emergency).

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Here, we answer the most common questions about surprise medical bills and what policymakers need to know to better understand this issue and protect patients.

Surprise Medical Bills 101

1. What is a surprise medical bill?

   A “surprise medical bill” is a bill a patient receives from a health care provider that is 1) outside of their insurance network and 2) in a circumstance that is outside of the patient’s control. In these circumstances, the health care provider might send a bill to the patient for the “balance” that remains after: 1) an insurer makes a payment; and 2) the patient’s deductible and any copay or coinsurance is applied.

   A patient might receive a surprise bill during a medical emergency, such as when a patient is taken to an “out-of-network” hospital during an emergency or when the emergency room doctor is out-of-network even if the hospital is in-network. Patients have also received surprise bills during a scheduled medical procedure at an “in-network” facility with an “in-network” surgeon, but where another provider (such as an anesthesiologist, radiologist, or medical lab) is out-of-network. “Surprise medical bill” and “balance bill” are often used interchangeably.

2. How big can surprise medical bills be?

   Surprise medical bills can vary significantly. While many surprise bills can be small, at least some patients have received surprise bills ranging from tens of thousands of dollars to more than $100,000.

   There is currently no comprehensive data on the size of surprise medical bills or how often an insurance company and provider negotiate a lower bill. The data we do have is specific to certain types of health care providers or industries. One study found that surprise bills from emergency physicians averaged about $622, with other potential surprise bills as high as $20,000. Another study found that patient costs for out-of-network bills are getting larger on average, up from $107 for an emergency room visit in 2010 to $482 in 2016. In a separate study, the Government Accountability Office found that the average cost of an air ambulance was about $36,000 for helicopter transport and $41,000 for fixed-wing transport. Although comprehensive data was not available, complaints about surprise air ambulance bills were almost always more than $10,000.

3. How common are surprise medical bills?

   There are no comprehensive data on the frequency of surprise medical bills. We can measure how often care is provided by out-of-network providers, but we cannot measure how often these out-of-network providers actually send balance bills to patients, how often providers settle for less than the initially billed amount, or how far providers go to collect unpaid bills.

   One way to estimate how often surprise billing occurs is to look at how often patients receive care from out-of-network providers. Patients that are seen by out-of-network providers may face a balance bill (unless protected by a state law). Recent studies show that out-of-network services (and thus the potential for a surprise bill) are common:

   • 18% of emergency visits and 16% of in-network inpatient stays resulted in an out-of-network charge (Kaiser Family Foundation)
   • 51% of ambulance services, 20% of inpatient emergency visits, 14% of outpatient visits, and 9% of elective inpatient care involves an out-of-network provider (Health Affairs)
   • At about 15% of hospitals, more than 80% of patients received out-of-network bills (National Bureau of Economic Research)
   • The percentage of emergency department visits with an out-of-network bill increased from 32% to 43% between 2010 and 2016 (JAMA Internal Medicine)

   Most patients visit an in-network hospital for an emergency visit. But many of the physicians in these emergency rooms are not in the same network as the hospital, resulting in out-of-network charges and potentially a balance bill for the doctor’s time. In Texas, for instance, 18% to 63% of in-network hospitals had no emergency physicians in the same networks in which the hospital participated in 2017.

4. Which health care providers are most likely to send a surprise medical bill?

   The specialties with the most out-of-network claims are anesthesiology (16%), primary care (13%), emergency medicine (11%), and radiology (8%). In a medical emergency, the providers most likely to send a surprise balance bill are emergency medicine specialists. But other physicians (such as cardiologists, surgeons, or radiologists) may also be needed to stabilize a patient after an emergency. When it’s not an emergency, and a patient has scheduled a procedure in an in-network facility with an in-network surgeon or obstetrician, the most common sources of surprise bills are from anesthesiologists, pathologists, and radiologists. Ground and air ambulance providers are also a common source of out-of-network bills. Air ambulances, in particular, can be very costly for patients, with an average trip costing over $36,000.

5. How do surprise medical bills affect health insurance premiums?

   Surprise medical bills are billed separately from a patient’s health insurance. This means that the surprise bill is what the patient owes in addition to what the patient pays in monthly premiums, their deductible, and any other cost-sharing (like a co-pay or coinsurance).

   As policymakers consider how to address surprise medical bills, many are focused on how the various solutions to surprise bills could affect health insurance premiums. The Congressional Budget Office has estimated that a federal proposal to protect patients from surprise medical bills would reduce premiums by about 1%. Other proposals may increase premiums. To learn more about these proposals, affordability, and ways to address surprise medical bills, check out our policy options.

6. Do patients in all states receive surprise medical bills?

   Yes, surprise medical bills can happen anywhere. But they may be more common in some areas. This variation depends on how insurers design their provider networks, the degree to which doctors and insurers reach informal agreements over out-of-network payments, and whether a state has laws to protect patients.

   Studies of insurance claims can tell us where patients are more likely to receive care from out-of-network providers, but not where they are more likely to face a surprise bill. Patients in Texas, New York, Florida, New Jersey, and Kansas are more likely to have an out-of-network charge for emergency visits and in-network hospital stays. This suggests that patients in those states may be more likely to receive a surprise medical bill. Some of these states—such as Texas, New York, and New Jersey—have state laws to help protect at least some patients.

7. Have states addressed surprise medical bills?

   Yes, states have long led the way when it comes to protections against surprise medical bills. Currently, just over half of states—28 states total—have adopted laws to prohibit or limit surprise medical bills. Of these, 13 states have taken a comprehensive approach while 15 states have taken a more limited approach. To learn more about state efforts and the variation in state approaches, check out these resources.

   While most states have taken steps to protect patients, gaps remain. Not all state laws are comprehensive, and some states do not protect patients at all. At the same time, states alone cannot protect everyone, and federal protections are critical. Learn more about federal efforts to address surprise medical bills here.

8. Has Congress addressed surprise medical bills?

   No, Congress has not yet passed federal legislation to address surprise medical bills. But there is momentum for Congress to do so and bipartisan consensus that patients should not face unexpected bills when they receive services from a health care provider who is not in their health insurance network because of an emergency or reason outside of their control.

   There are at least two major active proposals  with bipartisan support—including one in the U.S. Senate and one in the U.S. House of Representatives—that have been passed out of their respective committees. Although the goals are similar in these bills, the details vary. Read our new analysis of these proposals and check back as we watch these bills continue moving through Congress.

9. What do health care stakeholders say about surprise medical bills?

   All health care stakeholders generally agree that patients should be protected from surprise medical bills. But stakeholders often disagree about the best path forward and, in particular, how to resolve payment disputes between providers and health insurers. Providers are worried that certain policy solutions will tilt the playing field towards insurers, driving down payments and hurting providers’ bottom line. Insurers and employers fear that certain policy solutions will do the opposite, inflating provider prices, raising health care costs, and causing disincentives for physicians to participate in plan networks.

   To better understand these positions, check out our stakeholder resources.

10. Where can I learn more?

    Check out our resources for more information on surprise medical bills or head straight to considerations for policymakers. We are also here to help: policymakers can contact our team about a specific question or with a broader request for technical assistance. Our experts are available to review materials and consult on policy solutions.