Health Insurance

What is balance billing, and what does it mean for you?

Read Time

8 Minutes

Written by

Team Curative

Published

Feb 13, 2025

Have you ever received a medical bill that was much higher than you expected, even after your insurance paid its share? That is called balance billing. This common but often confusing practice can result in hefty out-of-pocket costs and financial stress. In this blog post, we'll demystify balance billing, explain why it happens, and provide practical tips for avoiding and managing these surprise expenses. Whether you're planning a medical procedure or just trying to navigate the complex world of healthcare, our guide will help you understand your rights and make informed decisions to protect your wallet.

Understand your rights when it comes to balance billing and affordable health insurance.

Let’s zoom out first: the cost of healthcare

Millions of employees find the healthcare process financially burdensome, which is why affordable health insurance is highly-valued for working-age adults. Many workers even pass on lifesaving preventive care services due to cost-related stress. This means a minor health problem left untreated can evolve into a more serious and costly condition.

One in three working Americans have deferred seeking medical care within the past year due to concerns about their ability to cover the associated costs and lack of affordable health insurance. The same survey found that 51% of working Americans reported financial difficulties skipped preventive health services, such as a yearly check-up or routine test.

Americans are anxious about the steep costs of healthcare. These costs are often the result of seeing an out-of-network provider and subsequently receiving a much higher bill than expected, coupled with a lack of access to transparent, affordable health insurance. A recent study found that, in the past two years, 41% of insured adults have been surprised by a medical bill. Nearly half of those adults received a surprise medical bill because their provider was out-of-network.

This phenomenon occurs due to a practice called balance billing. Balance billing can lead to unexpected costs and make it harder to manage your healthcare expenses. Having comprehensive, affordable health insurance is crucial as it can help you avoid the financial hardship associated with balance billing.

What is balance billing?

Balance billing occurs when a healthcare provider bills you for the difference between the amount they charge and the amount covered by your insurance. This can happen when you receive services from out-of-network providers, where your insurance plan doesn’t cover the full cost of services. For instance, if a doctor charges $150 for a service, but your insurance only covers $100, you might be billed for the remaining $50—a balance bill.

Balance billing can be a financial shock. However, it’s crucial to understand how it arises and the steps you can take to minimize its occurrence. Here are some key reasons why balance billing might happen:

Out-of-Network Providers: You might receive care from an out-of-network provider, resulting in higher charges.
Lack of Prior Authorization: Certain services may require pre-approval from your insurer, and failing to get this can lead to balance billing.
Service Not Covered: Services not covered under your plan may lead to unexpected bills.

What to expect when you see an in-network provider

When you see an in-network provider, you are visiting a healthcare professional or facility that has a contractual agreement with your health insurance plan. This arrangement typically means you will benefit from negotiated rates for services, which are generally lower than what you would be charged by out-of-network providers. As a result, your out-of-pocket costs, such as co-pays, deductibles, and co-insurance, are usually more predictable and affordable. Additionally, in-network providers handle the billing process directly with your insurance company, minimizing the risk of surprise medical bills and making it easier for you to manage your healthcare expenses.Seeing an in-network provider is a fairly straightforward process, especially if you have affordable health insurance.

What to expect when you see an out-of-network provider

Visiting an out-of-network provider means you are seeking care from a healthcare professional or facility that does not have a contractual agreement with your health insurance plan. As a result, you may face higher charges for services since these providers are not bound by negotiated rates. Insurance coverage for out-of-network services is often more limited, meaning you could be responsible for a larger portion of the bill or even the entire cost. It is crucial to understand your insurance policy and confirm the network status of your providers to avoid these financial surprises.

The No Surprises Act

Surprise billing is an unexpected form of balance billing. While balance billing might be anticipated if a patient is aware they are receiving out-of-network services, surprise billing occurs without the patient's prior knowledge or consent. It can be a distressing issue for those who don’t have access to transparent, affordable health insurance coverage. The good news is that the No Surprises Act provides significant protection for health plan members from unexpected medical bills. This federal law supplements state laws by filling in gaps and offering robust protections against surprise billing. The provisions in the Act include cost-sharing rules, prohibitions on balance billing for certain services, and requirements for providers to inform and consent regarding balance billing protections. The Act applies to healthcare providers, facilities, and air ambulance services, showcasing lawmakers' strong commitment to enhancing affordable health insurance and overall transparency.

As a health plan participant, it's crucial to understand your rights under the No Surprises Act. When balance billing is not allowed, you also receive the following protections:

You are only responsible for paying your share of the cost (such as copays, coinsurance, and deductibles), while your health plan will cover any additional costs to out-of-network providers and facilities directly.
Your health plan must:
- Cover emergency services without requiring prior authorization.
- Cover emergency services provided by out-of-network providers.
- Base what you owe the provider or facility on in-network rates, reflected in your explanation of benefits.
- Count any amount you pay for emergency or out-of-network services toward your in-network deductible and out-of-pocket limit.
- In addition to understanding your rights, it's essential to obtain a good faith estimate of costs upfront. Under the law, you have the right to receive a good faith estimate detailing the expected costs of your healthcare. This requirement ensures that healthcare providers give patients without certain types of coverage an estimate of their bill for healthcare items and services before they are received.

Finally, to avoid surprise billing, choose an affordable health insurance provider that prioritizes transparency and access to healthcare without unexpected financial burdens. Ensuring you have comprehensive and affordable health insurance coverage can protect you from surprise medical bills and allow you to focus on your health without financial stress.

Curative health plan member paying bills

How to avoid balance billing, surprises or not

To protect yourself from the stress of balance billing, consider the following strategies:

Check network providers: Make sure your healthcare providers are in-network by using your insurance's provider directory.
Understand your coverage: Familiarize yourself with your insurance benefits, including what's covered and what requires prior authorization.
Clear communication: Communicate with your providers before receiving services to confirm they accept your insurance and the coverage details.
Explore health plan options: Seek out insurance plans with comprehensive coverage and fewer instances of balance billing.

What if you could focus on fully engaging in your health and wellness journey without worrying about receiving surprise bills months after your appointment?

About Curative

Curative is a health plan employees love for its affordability, engagement, and simplicity. With $0 copays and deductibles for covered services from in-network providers, members can get the care they need when they need it without the financial burden. Imagine — a health plan that actually delivers better health without hurting your wallet.

Additionally, members can utilize the Curative Zero Card, a cash payment card to supplement the Curative Member ID card. Cardholders can pay for a range of approved services for themselves or dependents with providers on the Provider Search. It’s quick and easy to add a Zero Card provider by filling out a quick form. If approved, members can see that provider immediately using the Zero Card.

For more information on health insurance, comprehensive care resources, and how Curative can help you cultivate better health, visit our members page.

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