Editor’s Note: This perspective was originally published in Health Affairs Forefront on Nov. 11, 2025.
The No Surprises Act was passed by Congress with bipartisan support in December 2020 and signed into law by President Donald Trump at the end of his first term. The law’s ban on surprise medical bills was implemented in 2022 and has been largely successful in protecting commercially insured patients from being balance-billed when treated out of network for emergencies, receiving ancillary services at in-network facilities, and being transported by air ambulance.
Beyond these surprise billing provisions, the law also intended to provide patients with more insight into expected out-of-pocket costs for non-emergency health care services. The legislation stipulated that this provision of the law should have been implemented beginning on January 1, 2022. However, implementation of these provisions has been delayed, which continues to leave patients in the dark on what potentially large expenses await them.
Specifically, the act calls for establishing good faith estimates and an advanced explanation of benefits. A good faith estimate is an estimate of the total costs for planned health care services for an uninsured patient, generated by the health care provider. An advanced explanation of benefits is an estimate of an insured patient’s cost sharing and coverage for care prior to planned health care services. It is generated through collaboration among the health care facility, doctors, and health plan.
Congress is growing impatient with the delays in the implementation of this bipartisan consumer protection effort. Both Republican and Democratic members of the US Senate Committee on Health, Education, Labor, and Pensions called for the full implementation of this aspect of the No Surprises Act in a July 2025 letter to the secretaries of the Departments of Health and Human Services, Labor, and Treasury, stating that “Ensuring that patients have transparent, personalized cost estimates for their health care is a bipartisan priority.” This sentiment was echoed by Republicans on the US House Committee on Ways and Means in a September 2025 letter to the secretaries. In this article, I describe the regulatory and market hurdles to implementation and why these transparency benefits are critical for patients.
Nearly Five Years Of Preparation By Regulators And Industry
For several years, regulators have engaged with industry stakeholders on rulemaking, implementation, and enforcement of the No Surprises Act’s transparency mandates, but it has been a slow process. While good faith estimates can be produced unilaterally by health care providers, producing the advanced explanation of benefits requires coordination between providers and health plans. Developing standardized approaches to the coordination between providers and health plans is important for the successful implementation of the law, and regulators have been appropriately considerate of this in their approach to rulemaking.
The departments first issued final rules on August 19, 2022. This was followed by a request for information the following month. Two years of research and industry engagement ensued. Health plan, provider, and industry coalition organizations shared their ideas, preferences, and concerns regarding implementation. In April 2024 and December 2024, regulators reported on their progress, concluding there are approaches to generating advanced explanations of benefits that could work well using the system that providers and payers currently use for remittances (X12), as well as some promising approaches that are more forward-looking via an alternative standardized framework (HL7). The X12 solutions would be most viable to employ today with the legacy systems already in use.
It is unclear when the final rule might be issued, but regulators seem poised for action. The rule “Requirements Related to Advanced Explanation of Benefits and Other Provisions Under the Consolidated Appropriations Act 2021 (CMS-9900)” was listed on the Spring 2025 Agency Rule List docket as Proposed Rule Stage, but the final rule has not materialized, as of this writing.
A market response to cost transparency requirements is emerging, even before the regulatory details are final. Several health technology companies are marketing products to assist with implementation.
Cost Transparency For Planned Medical Services Is Needed
US patients largely operate within a consumer-directed health care system where many commercially insured individuals face significant out-of-pocket costs. Furthermore, anticipated reductions in federal funding for Medicaid and Marketplace plans may leave more Americans uninsured. In this market landscape, cost transparency for patients is crucial for effective financial planning. Federal price transparency requirements for shoppable hospital services and insurance carriers’ rates were important steps toward market transparency. Good faith estimates and advanced explanations of benefits expand on these prior actions with personalized cost information for patients planning their care.
Upfront cost information can also enable direct conversations between providers and patients about financial assistance and payment plan options, which the majority of hospitals do offer, before care is provided and debt is accrued. These financial arrangements prior to treatment may help alleviate the medical debt crisis and cost-sharing shortfall in provider revenues. Accurate cost estimates could also be compared more directly among provider options, enabling patients to be better informed consumers and potentially exerting the elusive competitive downward pressure on prices that economic theory suggests patients with skin in the game can wield.
Patients really need this information. USC Schaeffer Center research has found that it is difficult to get information about cost sharing, timing of payment requirements, and payment plan options online and by telephone prior to planned care. We have also found that patients struggle to navigate medical bills and advocate for themselves in the aftermath of care when they believe there is a mistake on their bills and they can’t afford them. As a part of research for rulemaking, regulators conducted consumer research and concluded that their “research underscored the importance of standardized, understandable, and accurate cost information in advance of care.”
Opportunities For Additional Consumer Protection
The emergence of advanced explanations of benefits may escalate the provider practice of seeking pre-payment or point-of-service payment of the estimated cost-sharing obligation for planned health care services. This practice of collecting patients’ funds upfront is not new, but it may become a more palatable and common practice in the health care industry when advanced explanations of benefits facilitate standardized and reliable cost-sharing estimates. Concurring policies that remove medical debt from credit reporting in some states, potentially making post-service collection harder for providers, may also fuel this trend in advanced cost-sharing collection. Upfront payment requirements could pose a barrier to access, and additional consumer protections could be implemented to mitigate this risk.
Expectations of cost-sharing payments before care is delivered could facilitate better financial planning for patients and providers, so long as financial assistance and payment plan options are offered alongside the advanced explanation of benefits. The majority of US hospitals do offer payment plans without interest or fees, and nonprofit hospitals are required to extend financial assistance to low-income patients. Transparency about these mechanisms to enhance affordability, paired with accurate cost-sharing estimates, would strengthen patients’ positions as informed “shoppers” in our consumer-driven health care market. State and federal policy makers could consider approaches to encouraging or requiring the presentation of information about financial assistance and payment plans alongside advanced explanations of benefits.
As patients pay for care in advance, there may also be situations in which they overpay the provider and should be refunded. Florida and Texas have laws requiring timely, full repayment to patients within 30 days of identifying the overpayment. Other states could develop similar policies specifying the time frame in which health care providers have to repay patients’ overpayments. Expectations for repayment could also be included in contracts between health plans and providers.
These additional consumer protections would be valuable to patients but may have to wait for additional rulemaking. The good faith estimates and advanced explanation of benefits provisions of the No Surprises Act should not be further delayed.
We Can Do This Today
Congress was wise to legislate cost transparency for planned health care services for their constituents, and it is time to finally implement the law. Industry members and regulators acknowledge that an implementation approach based on X12 would be feasible with the technology we have today. As the five-year anniversary of the law’s passage approaches, what are we still waiting for?
Author’s Note
This work is funded by a grant from Arnold Ventures. Erin Duffy receives grant funding from the California Health Care Foundation, Arnold Ventures, and Gates Ventures. She has also received personal fees from Cornerstone Research as a litigation expert on matters in the hospital and health insurance sectors.
Duffy, Erin L., The Unfinished Work Of The No Surprises Act: Cost Transparency For Planned Care, Health Affairs Forefront, Nov. 12, 2025, https://www.healthaffairs.org/content/forefront/unfinished-work-no-surprises-act-cost-transparency-planned-care
Copyright © 2025 Health Affairs by Project – HOPE – The People-to-People Health Foundation, Inc.
