Psyhc Care

Introduction: The New Era of Patient Protection

The No Surprises Act (NSA), which took effect on January 1, 2022, has ushered in a transformative chapter in U.S. healthcare billing. Primarily designed to protect patients from unexpected medical bills—especially from out-of-network providers during emergency care—the law also extends into the realm of mental health services. Behavioral health providers, often operating with lean billing teams and nuanced patient relationships, now find themselves facing increased regulatory demands with potentially significant financial and operational impacts.

While the initial public discourse around the NSA centered on emergency services and hospital-based care, its provisions around good faith estimates (GFEs), balance billing, and cost transparency directly affect psychological and psychiatric care—including psychotherapy, counseling, medication management, and related services.

For mental health clinics, private practitioners, and group therapy practices, the NSA isn’t just a new compliance box to check—it’s a call to reshape how pricing, billing, and communication with patients are handled. This article unpacks the core elements of the No Surprises Act, analyzes its specific implications for PsychCare billing, and offers actionable strategies to maintain compliance while preserving patient trust and revenue integrity.

The Origins and Objectives of the No Surprises Act

The No Surprises Act was enacted as part of the Consolidated Appropriations Act of 2021. Its primary goal was to address a widespread issue in American healthcare: surprise medical billing. These unexpected charges often occurred when patients—unwittingly or out of necessity—received services from out-of-network providers, especially in emergency situations. In such cases, patients were “balance billed” for the difference between what their insurance covered and what the provider charged.

The NSA aims to:

• Protect patients from surprise billing in emergency and certain non-emergency settings.
• Increase transparency in healthcare pricing.
• Empower consumers to make informed decisions about their care.
• Shift payment disputes from patients to insurance companies and providers.
• Require providers to supply Good Faith Estimates for expected charges to uninsured or self-pay patients.

While originally focused on hospital and emergency care, the Act includes specific mandates that apply to all licensed healthcare providers, including those in behavioral health. As a result, psychologists, psychiatrists, therapists, counselors, and social workers must ensure their billing practices align with the NSA’s new requirements or face regulatory penalties and patient distrust.

Applicability of the NSA to Mental Health Providers

Many behavioral health providers initially believed the NSA did not apply to their practice type, especially if they operated solo or outside of hospital systems. However, the law explicitly applies to all providers licensed or certified by the state to provide healthcare services—a definition that includes most mental health professionals.

The core NSA provisions that impact PsychCare billing are:

1. Good Faith Estimates (GFE) for uninsured and self-pay patients
2. Prohibition on balance billing for certain out-of-network services
3. Provider-payer dispute resolution processes (IDR)
4. Patient-provider dispute resolution (PPDR) process for GFEs exceeding billed charges by $400+

As such, therapists and psychiatrists—whether in group practices or solo settings—must reevaluate their fee disclosures, intake workflows, and billing communication strategies to avoid violations.

The Good Faith Estimate (GFE): What Mental Health Providers Must Know

One of the most impactful provisions for behavioral health is the requirement to provide Good Faith Estimates to uninsured or self-pay patients. The GFE must outline the anticipated cost of services in advance, including session fees, frequency, and duration.

Who Needs to Receive a GFE?

• Patients who do not have health insurance.
• Patients who choose not to use their insurance (i.e., they are “self-pay”).

When Must the GFE Be Provided?

• Within 3 business days after a patient schedules a service more than 10 days in advance.
• Within 1 business day if the service is scheduled less than 10 days in advance.
• Upon request from any uninsured/self-pay patient, even if the service is not yet scheduled.

What Must Be Included in the GFE?

• Patient name and date of birth.
• A clear description of the expected services (e.g., “weekly psychotherapy, 45 minutes per session, for 6 months”).
• CPT codes and estimated charges.
• Provider name, NPI number, and office location.
• Disclaimers about variability in treatment duration and the patient’s rights under the NSA.

For example, a therapist charging $150 per 45-minute session might estimate 20 sessions over six months, resulting in a total estimate of $3,000.

The Challenge of Estimating Behavioral Health Care

Providing accurate GFEs in mental health settings can be uniquely challenging due to the fluid and evolving nature of therapy. Unlike a fixed procedure like an X-ray or surgery, psychotherapy is inherently flexible, often shaped by progress, setbacks, and patient readiness.

This creates a dilemma for clinicians: How do you predict the number of sessions or total cost of care without overpromising or misleading?

To mitigate this, HHS has issued guidance encouraging providers to:

• Offer a range or estimate of sessions (e.g., 10–20 sessions).
• Include clear disclaimers about variability and the collaborative nature of treatment planning.
• Update the GFE if treatment goals or frequency change significantly.

Best practice involves creating a template-based GFE that includes customizable fields for service type, rate, frequency, and estimated duration—updated as clinically appropriate.

Balance Billing: What’s Prohibited and What’s Permitted

The NSA prohibits balance billing in certain scenarios, primarily for:

• Emergency services received at out-of-network facilities.
• Non-emergency services received at in-network facilities where an out-of-network provider (e.g., an anesthesiologist or pathologist) is involved.

However, most outpatient behavioral health settings are not included in these scenarios unless:

• A mental health provider operates within a hospital or facility system.
• A psychiatrist provides emergency evaluation services in an emergency department.

Therefore, balance billing may still be allowed in many private practice mental health scenarios, provided patients are given clear advance notice and consent. However, providers are strongly encouraged to maintain transparent pricing and document all fee agreements to avoid disputes.

Documentation and Compliance Requirements

To remain compliant with the NSA, mental health providers must establish clear documentation and tracking systems for GFEs and patient communication. This includes:

• Retaining copies of all GFEs provided.
• Recording the date and method of delivery (e.g., email, patient portal, printed copy).
• Documenting patient responses, especially if they request to use insurance instead.
• Updating GFEs when treatment plans change.
• Informing billing teams of GFE parameters to ensure consistency in claims.

Many EHR vendors have introduced templates and modules for NSA compliance. However, smaller practices relying on manual documentation should consider adopting digital tools to standardize and automate GFE workflows.

The Patient-Provider Dispute Resolution (PPDR) Process

A key enforcement mechanism of the NSA is the PPDR process, which allows uninsured or self-pay patients to challenge a bill if it exceeds the GFE by $400 or more.

If a patient believes they were billed unfairly, they can initiate a formal review through the Department of Health and Human Services. The provider must then:

• Submit documentation justifying the higher cost.
• Demonstrate that the billed amount was reasonable given the clinical context.
• Show evidence of timely GFE updates (if applicable).

If the provider cannot adequately justify the discrepancy, the billed amount may be reduced, and the provider may be held financially accountable.

This makes accurate estimation and timely communication crucial. Frequent or unexplained cost overruns could not only damage patient relationships but also expose the practice to regulatory scrutiny.

Impact on Insurance Reimbursement and In-Network Billing

While much of the NSA focuses on self-pay scenarios, in-network providers are also indirectly impacted. For example:

• Insurers may request GFE-style documentation during audits.
• Patients with high deductibles or coinsurance may question unexpected charges.
• Payers may scrutinize billing practices more closely if patients file complaints.

For in-network behavioral health practices, this means strengthening billing transparency, improving EOB (Explanation of Benefits) communication, and ensuring that out-of-pocket estimates are provided prior to care delivery.

In other words, even if balance billing is not a direct concern, NSA principles of transparency and accuracy still apply and can influence network relationships and patient satisfaction scores.

Effect on Group Practices and Multi-Provider Clinics

Group practices face unique NSA challenges, including:

• Coordinating GFEs across multiple providers.
• Ensuring consistency in pricing structures.
• Managing intake workflows that trigger the GFE timeline.
• Communicating estimates to patients in team-based care environments.

In these settings, centralized RCM teams must build GFE protocols into the front-end intake process. For example, when a patient schedules a new evaluation, the system should automatically trigger:

• Insurance status verification.
• GFE generation if the patient is uninsured or self-pay.
• Email or portal delivery of the GFE with read-receipt tracking.

Without coordinated systems, clinics risk gaps in compliance or duplicated efforts, especially when multiple providers contribute to one episode of care.

Telehealth and the NSA: Are Remote Providers Affected?

Telehealth mental health services are fully included under the NSA. Whether a session occurs in person or via video, the provider is required to:

• Verify insurance status.
• Deliver GFEs to uninsured/self-pay patients.
• Avoid surprise billing for out-of-network care unless properly disclosed and consented.

In fact, the disconnected nature of telehealth intake can make NSA compliance more difficult. Practices must ensure that:

• Online scheduling systems capture payer status accurately.
• GFE templates are built into telehealth intake portals.
• Email-based communication is HIPAA-compliant and trackable.

Remote providers operating across multiple states should also remain aware of state-specific interpretations of NSA rules and balance billing bans, as regulations may vary slightly across jurisdictions.

Software and Automation Solutions for NSA Compliance

Given the administrative burden of compliance, many RCM platforms and EHR vendors have rolled out tools specifically designed for NSA documentation. Key features include:

• Auto-generation of GFEs based on session type, rate, and estimated frequency.
• Templates prefilled with CPT codes, provider info, and disclaimers.
• Intake triggers to detect uninsured/self-pay status.
• E-signature or acknowledgment tracking for patients.
• Audit logs showing date and method of GFE delivery.

Providers not using fully integrated software must consider adopting standalone compliance tools or building internal tracking systems. Excel sheets, intake checklists, and template-based emails are viable interim solutions but must be used consistently and securely.

Legal Risks of Non-Compliance

Failure to comply with the NSA can result in:

• Civil monetary penalties of up to $10,000 per violation.
• Enforcement actions by HHS or state agencies.
• Loss of patient trust and potential online reputation damage.
• Insurance disputes if balance billing is improperly executed.
• Increased audit scrutiny from payers and regulators.

The best defense against these risks is proactive, documented compliance. Providers must not only implement NSA protocols but also educate staff and patients to avoid confusion and disputes.

Educating Patients and Setting Expectations

NSA compliance is not just a provider responsibility—it’s also about patient education. Patients may misinterpret GFEs as final bills or assume all services will fall under the quoted range.

Best practices for communication include:

• Clarifying that the GFE is an estimate, not a guarantee.
• Explaining that therapy duration may change based on progress.
• Offering updated GFEs when treatment plans evolve.
• Including GFE explanations in welcome packets or informed consent documents.

The more transparent and patient-centered the GFE process is, the less likely patients are to feel “surprised” later.

Preparing Staff and Clinicians for Compliance

NSA implementation requires collaboration across front-desk teams, clinicians, billing specialists, and administrative staff. Effective strategies include:

• Creating standardized GFE templates for different services.
• Training staff on NSA timelines and eligibility triggers.
• Establishing intake workflows that flag uninsured or self-pay patients early.
• Using digital tools to track and update GFEs as needed.
• Scheduling periodic audits to review GFE documentation and patient feedback.

All team members should understand their role in ensuring compliance—not just billing personnel.

Conclusion: Turning Compliance into Confidence

The No Surprises Act represents more than a regulatory shift—it’s a cultural one. At its core, the NSA demands that healthcare providers, including those in behavioral health, treat cost transparency as a clinical responsibility. While the initial implementation can feel burdensome, especially for small practices, the long-term benefits are clear: stronger patient trust, fewer billing disputes, and more ethical, sustainable revenue cycles.

For PsychCare providers, adapting to the NSA means embracing structured, proactive communication about fees, empowering patients with realistic expectations, and building billing workflows that are as compassionate as the care they support. With the right tools, training, and intention, NSA compliance can become an opportunity—not an obstacle.

SOURCES

Centers for Medicare & Medicaid Services. (2022). No Surprises Act: Implementation Guidance. CMS.gov.

Department of Health and Human Services. (2022). Guidance on Good Faith Estimates for Uninsured and Self-Pay Patients. HHS.gov.

American Psychological Association. (2022). Understanding the No Surprises Act: What Psychologists Need to Know. APA Practice Update.

National Council for Mental Wellbeing. (2023). The No Surprises Act and Behavioral Health Providers: Compliance Strategies. Policy Brief.

Health Affairs. (2021). The No Surprises Act: A Landmark Achievement in Patient Protection. Health Affairs Blog.

Manatt Health. (2022). Provider Requirements Under the No Surprises Act. Manatt Health Insights Report.

HISTORY

Current Version
June, 28, 2025

Written By
BARIRA MEHMOOD