Everything is scheduled, the procedure is complete, and it was a success. Suddenly, someone discovers the insurance is out of network. The patient receives an unexpected bill, which leads to complaints, lost revenue, and bad debt.

“Patients often remain unaware of the complex system of contracts, regulations, and policies that determine how their medical services are paid by insurance,” says Sondra Cari, managing director in Huron’s performance improvement business focusing on revenue.

Tucked into the COVID-19 relief package Congress passed at the end of 2020 was a provision that essentially ends surprise billing.1 When the terms of this provision take effect in January 2022, some out-of-network providers will not be able to balance bill patients unless the provider sends the patient an estimate 72 hours before he or she receives services and consents to undergoing out-of-network care.1 (Editor’s Note: Be sure to read future issues of Hospital Access Management to learn much more about the terms of this deal.)

For now, though, every out-of-network claim is at risk of going unpaid. The hospital is in a tough spot, forced to either write off the bill or try to collect from an angry patient. “Collection efforts often risk patient satisfaction, and even the hospital’s reputation in the community,” Cari notes.

The dreaded out-of-network bill might happen because it was an emergency, and the patient had no choice in where he or she went for care. But surprise bills can occur even when details are scheduled in advance. “Often, these bills don’t come from the hospital but from a group, such as ER doctors or anesthesiologists,” Cari explains.

Many elective surgeries at in-network facilities, with in-network surgeons, still resulted in an out-of-network bill, according to an analysis of commercially insured patients.2 Of 347,356 patients, 20.5% received an out-of-network bill, with a mean balance of $2,011. Most bills came from surgical assistants and anesthesiologists. Patients with health insurance exchange plans and those who experienced surgical complications received more out-of-network bills.

To prevent canceled procedures, Cari says the key is to identify any out-of-network providers as early as possible while there is time to do something about it. Hospitals should be sure payor networks are aligned, and that nobody who is out of network with the coverage is going to end up caring for the patient. “Something as simple as missing one contract expiration can create a cascade of surprise bills,” Cari says.

If the claim is denied on out-of-network grounds, Cari says to turn the patient into an advocate. Warn the patient the dispute might take weeks or months to resolve. “This is also an opportunity to inform the patient of potential community programs and charity options to assist in paying their bills,” Cari suggests.

At Cleveland Clinic, the patient access department instituted processes to address out-of-network coverage specifically. Right when care is scheduled, the registration system alerts staff if a patient has out-of-network insurance. “At that time, scheduling is stopped until the patient is financially cleared,” says Annmarie Kish, assistant finance director in the revenue cycle management team’s financial counseling department.

First, the authorization team obtains permission for the service. Next, the patient financial advocate team contacts the patient to notify him or her of the network status and their financial responsibility. If the patient wants to proceed regardless of the out-of-network status, the process moves forward. The patient gives a deposit and agrees to pay anything the health plan does not cover.

“If there is an urgent clinical need for the patient to proceed, the scheduler is able to override the warnings and create an appointment,” Kish notes.

Staff are clear on what to expect with out-of-network coverage and what options exist. Some patients presented with coverage that was in network, but then circumstances changed suddenly. “Many patients don’t know they are out of network, or even what that means,” Kish says. “We don’t want patients to be surprised by large bills because of this.”

For unscheduled care (e.g., ED visits or urgent care), Cleveland Clinic staff follow the health plan’s guidance on the patient’s financial liability. “Depending on the amount, a charity adjustment is evaluated,” Kish reports.

All accounts with out-of-network coverage are flagged for the insurance follow-up team to handle. “We are able to track and trend the out-of-network bad debt and controllable loss,” Kish says.

If staff do figure out after the service that a patient’s insurance is out of network, “we do not bill the patient,” according to Kish. In some cases, the health plan agrees to pay the claim as if it were in network. “We can, on rare occasions, overturn the denial due to medical necessity,” Kish adds.


  1. Springston J. Lawmakers broker agreement to end surprise billing. Relias Media. Dec. 22, 2020.
  2. Chhabra KR, Sheetz KH, Nuliyalu U, et al. Out-of-network bills for privately insured patients undergoing elective surgery with in-network primary surgeons and facilities. JAMA 2020;323:538-547.