Navigating mental health coverage doesn't have to feel like wandering in the dark.

We're here to light the way.

What The No Surprises Act Means for Therapists and Mental Health Professionals

January 20, 2022

Therapy Practice

It’s a scenario Americans are all too familiar with: an insured patient is admitted to a hospital for an ailment and is shocked to find exorbitant out-of-network charges on their medical bill. Fortunately, Congress recently passed legislation to combat unforeseen medical costs that weren’t overtly disclosed to the patient before care was administered. Called the No Surprises Act, the law is a positive step towards increased transparency of medical billing and represents a huge win for patients everywhere. As with anything, though, there is a logistics-laden downside: medical practitioners must evolve new client onboarding practices in order to ensure compliance with the new law, which went into effect on January 01, 2022. Although the law is primarily intended to address emergency room visit medical care, it has implications for therapy practices.

The No Surprises Act may be new, but we at Nirvana have been working to address the issue of medical billing transparency for quite some time. It’s part of why we created the Nirvana platform, to help therapy clients understand their benefits better so they can maximize care. 

Read on to learn everything you need to know about the No Surprises Act, and how to remain compliant with the new law:

The No Surprises Act May Not Apply to All of Your Clients… Yet.

The language in the No Surprises Act is primarily focused on out-of-network providers who operate within in-network facilities, and emergency services. This means that, for the moment, No Surprises Act activities only technically apply to out-of-network clients. However, the law will soon extend to both in-network and out-of-network clients, so it’s ideal to establish a new process for all clients. 

Standard Charge Sheets Have Never Been More Important

To help with No Surprises Act compliance activities, you’ll want to develop a charge master that includes the costs of all services that you provide. This charge sheet should include standard medical billing codes to ensure no ambiguity. Make sure that you include rates for services that are longer or shorter than a standard 60 minute therapy session. 

Good Faith Estimates Are Now A Required Piece of Client Onboarding

In order to ensure that your practice is compliant with the No Surprises Act, all new out-of-network clients will need to be provided with a Good Faith Estimate – a document that clearly states the charges for all services clients can anticipate after services are rendered. You’ll want to use your standard rate sheet to create this Good Faith Estimate, to ensure consistency across your practice. While Good Faith Estimates are intended for new clients, you’ll need to retroactively provide Good Faith Estimates to all of your current clients and keep a signed copy on file for each. 

How The No Surprises Act Works with Sliding Scale Therapy

Many therapists elect to invoice their clients using a sliding scale method. While you can continue to offer reduced rates for mental health services and still comply with the No Surprises Act, the way in which you communicate about – and invoice for – sliding scale rates will need to look a little different. Your Good Faith Estimate should still reflect your standard rates, even if you plan to offer a client with sliding scale pricing for therapy services. Failing to present your full rates up front can potentially expose you to legal issues in the future. Under the No surprises Act, your client will have grounds to sue should sliding scale rates ever increase. This may happen if the client acquires insurance that covers mental health, financial circumstances improve, or you choose to raise costs to better align with inflation. 

Your Good Faith Estimate may need to reflect your standard rates, but you remain free to continue to invoice your client on a sliding scale rate. The goal is to avoid providing an estimate that could become legally binding in the future.

The Foolproof Way to Comply with the No Surprises Act 

Does this sound like a lot of extra paperwork and follow up? That’s because it is. If you’re like most therapists running a practice, you already don’t have enough hours in the day. Fortunately, Nirvana’s mental health billing platform is designed to outsource No Surprises Act compliance. Therapists can simply enter new client information into your EHR system, and we take care of the rest. Our secure and HIPAA compliant system combines EHR data and your unique rate sheet to generate and send a custom Good Faith Estimate to each new client. And because situations change, our team proactively monitors changes in insurance and other factors that may cause your practice to be out of compliance, and follows up directly with clients on your behalf to ensure that you stay in good standing with the new law. It’s just one way we make it easier to grow your practice with confidence. 

Still have questions about the 2022 No Surprises Act? See if Nirvana is right for you: take our two minute quiz!