No Surprises Act for Self-Insured Employers: Closing the Balance Billing Gaps the Law Left Open

What the No Surprises Act Actually Changed

The No Surprises Act (NSA), effective January 1, 2022, addressed one specific problem: surprise balance bills from out-of-network providers at in-network facilities. The protections are real but narrower than many employers think.

What the law prohibits:

• Out-of-network emergency services bills above the in-network cost-sharing amount
• Out-of-network air ambulance services (ground and water ambulances are not covered)
• Balance bills from non-participating providers at participating facilities who render care without the patient's consent
• Most air ambulance balance bills

The law caps patient liability at in-network deductible, copay, and coinsurance amounts when these situations occur. The provider and plan then settle the balance through independent dispute resolution (IDR) or arbitration.

What changed for self-insured plans specifically: Self-insured ERISA plans are subject to NSA protections. This means your plan document must include NSA compliance language, and your claims processing must enforce these rules. The law does not exempt self-insured plans from the protections—it applies equally.

What the No Surprises Act Did NOT Change

This is where balance billing exposure persists for self-insured employers.

Out-of-network care chosen by the employee: If your employee elects to go out-of-network, balance billing is not restricted. The provider can bill the patient the full difference between their charge and what your plan pays. This remains the employee's responsibility.

In-network deductibles and cost-sharing: The law does not change deductible amounts, copay structures, or coinsurance percentages. If your plan requires a 20% coinsurance, an out-of-network claim at an in-network facility still hits that 20%, but the IDR process determines what the provider receives.

Employer coverage of balance bills: Nothing in the NSA requires employers to absorb balance billing costs. The law creates a dispute resolution mechanism—it does not mandate employer payment of disputed amounts.

Non-emergency out-of-network care at out-of-network facilities: Zero protection. If your employee sees an out-of-network specialist at an out-of-network office, balance billing applies in full.

Telehealth and retail clinics: These services often operate outside traditional facility networks. If the telehealth provider is out-of-network, NSA protections do not apply unless care occurs "at" a participating facility—which telehealth rarely does.

Mental health and substance use disorder services: While the Mental Health Parity and Addiction Equity Act applies, the NSA does not carve out special protections for behavioral health. Out-of-network mental health balance billing exposure is identical to medical services.

How Self-Insured Plans Remain Exposed

Self-insured employers fund claims directly. You absorb the cost of NSA disputes when they occur, and you also absorb costs when the NSA does not apply.

The IDR process: When a provider-plan dispute triggers IDR, the arbiter determines payment. Self-insured plans typically receive the bill from their third-party administrator (TPA). If the arbiter rules the provider gets more than the plan offered, that cost comes from your plan's reserve or next funding cycle.

Network adequacy gaps: If your network lacks specialists in your geographic area, employees use out-of-network providers. The NSA does not mandate that plans maintain adequate networks—only that protections apply when NSA conditions are met. Your employees still face balance bills for true out-of-network care.

Employer plan document compliance: Many self-insured plans have not updated plan documents to reflect NSA requirements. Failure to include explicit NSA language creates legal exposure and potential fiduciary liability.

Structuring Your Plan to Minimize Balance Billing Exposure

1. Update plan documents immediately

If you have not added NSA-compliant language to your plan documents, do this now. Work with your ERISA counsel and TPA to ensure language covers:

• Emergency services protections
• Non-emergency services at participating facilities
• IDR and arbitration procedures
• Patient liability caps aligned with NSA

2. Audit your network

Work with your TPA and broker to map out gaps. Identify specialties and geographic areas where your network is thin. This tells you where employee balance bill risk is highest.

3. Strengthen primary care access

Employees who have regular primary care relationships are less likely to self-refer out-of-network. Incentivize in-network PCP visits with lower copays—typically $15–$25 copays drive utilization versus $40–$50 copays.

4. Implement reference-based pricing for elective procedures

For planned surgeries and procedures (joint replacements, cataract surgery, orthopedic procedures), negotiate fixed bundled rates with a limited set of high-quality providers. This eliminates balance billing for these high-cost, predictable services. Typical savings: 15–30% below standard rates.

5. Require prior authorization for out-of-network specialty care

Most TPAs can enforce a rule: no coverage for non-emergency out-of-network specialty care without prior authorization. When authorization is denied, the employee knows upfront that out-of-network bills will not be covered. When authorization is granted, the TPA can negotiate a single case agreement with the provider, controlling balance billing risk.

6. Employee communication

Educate employees about where NSA protections apply. This is critical: employees believe the NSA protects all surprise bills. It does not. Clear communication about what is and is not covered reduces dissatisfaction and disputes.

Bottom Line

The No Surprises Act closed one door to surprise balance billing but left many others open. Self-insured employers cannot rely on the NSA alone to manage balance billing exposure. You need updated plan documents, a stronger network strategy, and procedural controls (prior authorization, bundled pricing) to reduce risk. The cost of network improvements and contract negotiations is typically 0.2–0.4% of annual premium spend but prevents individual claims of $5,000–$50,000 in uncovered balance bills.

Start with plan document compliance. Move to network audits. Then layer in reference-based pricing and prior authorization discipline. This three-phase approach addresses the gaps the law left open.