All privately insured consumers are vulnerable to surprise billing, or balance bills, for out-of-network care. These bills arise when insurance covers out-of-network care, but the provider bills the consumer for amounts beyond what the insurance pays and typical cost-sharing. Often this occurs even when the patient is careful to choose an in-network hospital and physician, but during the course of care an additional treating provider — an anesthesiologist, for instance — is out of network. To date, 28 states have enacted consumer protections addressing surprise medical bills. Of these, 13 have met our standard for comprehensive protection.

Comprehensive protection limits consumers’ financial exposure to normal in-network cost-sharing. Specifically, it:

  • extends protections to both emergency department and in-network hospital settings
  • applies to enrollees of HMOs and PPOs
  • prohibits providers from balance billing, and
  • adopts a specific payment standard or dispute-resolution process to resolve payment disputes between providers and insurers.

Although these laws provide valuable protections to residents who are insured under the types of fully insured products that are subject to state regulation, they are not helpful to consumers who receive their health coverage from self-funded plans — that is, those offered by employers that bear insurance risk for their employees. This is because federal ERISA law prevents states from regulating such plans. States also are restricted by federal law from protecting people who use air ambulances from surprise bills.

Federal Legislation

These gaps in states’ authority, combined with the failure of many states to enact comprehensive protections, have led to a push for federal legislation. During the 116th Congress, at least six bills have been introduced to address surprise medical bills; four have bipartisan support.

Surprise Billing Legislation in the 116th Congress

S. 1895, introduced by Sens. Alexander (R–Tenn.) and Murray (D–Wash.)

H.R. 3630, introduced by Reps. Pallone (D–N.J.) and Walden (R–Ore.)

S. 1531, introduced by Sens. Cassidy (R–La.) and Hassan (D–N.H.)

H.R. 3502, introduced by Reps. Ruiz (D–Calif.) and Roe (R–Tenn.)

H.R. 861, introduced by Rep. Doggett (D–Texas)

S. 1266, introduced by Sen. Scott (R–Fla.)

Two of these have been advanced by their respective committees. The Alexander–Murray bill was approved by the Senate HELP Committee by a large bipartisan majority on July 8, 2019. Soon after, the Pallone–Walden bill was approved by of the House Energy and Commerce Committee by voice vote. There may yet be action from the Senate House Committee and other House committees, such as the Committee on Education and Labor and the Committee on Ways and Means, but for the moment these two bills indicate significant movement on this issue.

Similarities Between Committee-Backed Bills

Although the two bills have significant differences, they share many key features. A more detailed summary of the two bills is available here. Significantly, they meet all the criteria we have used for evaluating comprehensive protections at the state level.

Differences Between Committee-Backed Bills

Finding an adequate payment standard

Both bills base payment on the median amounts used by a health plan for its in-network providers. The Senate HELP bill uses the rate in effect at the time the service is provided. The House Energy and Commerce bill uses the in-network rate for 2019 and inflates it forward to the year of the service. Unlike the Senate bill, the House bill establishes a formal dispute resolution process in which an independent arbitrator determines the payment level in cases where providers are not satisfied with the amount paid under the payment standard. Eligible cases for arbitration must involve a bill of over $1,250, calculated as the amount established by the payment standard. The bill prohibits arbitrators from considering the provider’s billed charges in determining an appropriate payment amount. It requires both parties to accept the arbitrator’s decision.

Deference to state law and enforcement

The bills take similar approaches in determining how the federal protections will interact with state protections. They both defer to the states for insurance arrangements where the states have jurisdiction. In states that have protections, those will apply to fully insured products, while the federal protections will apply to self-funded products. The House Energy and Commerce bill has one exception to this rule: patient cost-sharing (specifically coinsurance) will be based on the lower payment amount between the state and federal standards. Thus, if a state, either through its payment standard or arbitration, pays the provider more generously, patient coinsurance may not be based on the higher amount. Both bills rely substantially on the states for enforcement of surprise billing protections on state-regulated health insurance. Both also use federal civil money penalties as a fallback enforcement mechanism.

Ambulance services

The Senate HELP bill extends protections to people using air ambulance services. The House does not provide a similar protection, although it does require itemization of certain charges on air ambulance bills. Neither bill has protections for users of ground ambulance services.

Looking Forward

Congress has moved a long way toward enacting protections for consumers who face balance bills. But stakeholders, namely providers and insurers, even though they agree broadly on the goal of protecting consumers, continue to disagree on approaches to payment. Protecting consumers will require policymakers to find a path forward that will overcome providers’ and insurers’ objections. As we monitor activity going forward, it will be important to watch whether the bills that have emerged are weakened in a way that would not provide comprehensive protection for consumers.


Georgetown University’s Center on Health Insurance Reforms has launched a resource center to help policymakers looking for technical assistance in addressing surprise medical bills.