What Are Good Faith Estimates in Healthcare?
Key takeaways:
A good faith estimate (GFE) is a financial document that shows the expected charges for healthcare services provided to uninsured individuals and those with insurance who choose to self-pay. It's not a bill.
Most healthcare providers must give you a GFE if you request one and you are uninsured or plan to pay the bill without insurance.
You can dispute the final bill if it is at least $400 more than the GFE.
Would price projections before surgery help you avoid medical debt? A good faith estimate (GFE) can take the mystery out of a potential medical bill. A GFE also can lower your stress about the costs of healthcare.
GFEs are part of the No Surprises Act, a federal law aiming to end surprise medical bills that took effect on January 1, 2022.
It is a financial document that projects healthcare charges for uninsured people and those who self-pay for medical care. For example, a GFE for elective surgery could include the expected anesthesia costs and the surgeon’s fee. Starting in 2023, the main facility or provider must include estimates for related services expected from a co-provider or co-facility.
The GFE does not need to include unexpected or unknown costs that may arise during treatment.
After receiving a GFE, you aren't obligated to get the service. That’s why GFEs may help you shop for better prices for nonurgent care, limit surprises, and prevent medical debt.
Below, we highlight common questions about GFEs and explain how these price projections can help you manage healthcare costs.
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How do good faith estimates work in healthcare?
If you ask for a GFE or schedule a health procedure, healthcare providers and facilities must offer it. This applies to facilities such as:
Hospitals
Some surgical centers
Lab centers
Imaging centers
Federally qualified health centers
Rural health centers
Healthcare providers must give you a GFE before the procedure and within a specific timeframe.
When you get a GFE will depend on:
When you schedule the service
When you request the estimate
The procedure date
Here are some examples:
If you request an estimate at least 3 business days before a scheduled procedure, you should have it no more than 1 business day after scheduling.
If you set a procedure 10 business days ahead and ask for an estimate, the provider should offer it no later than 3 business days before the service.
What details are included in a good faith estimate?
A typical GFE includes projected healthcare charges and relevant patient information. Healthcare providers must offer GFEs in writing — either on paper or digitally by email or through a patient portal.
Here is what you typically will find in a GFE:
Patient information: This includes relevant information about the person getting the item or service, such as your full name and address, date of birth, health plan member ID number, diagnosis, and requested medical service.
Provider details: This includes the provider name, date of service, date of the good faith estimate, itemized estimated cost for service, and total estimated cost of the one-time or recurring expense; a GFE covers 12 months of health services if the costs are recurring. Sometimes, each line item will have a medical or service code.
Do you have to request a good faith estimate to receive one?
If you do not have insurance or you are paying out of pocket, providers must give you a GFE if you ask for one or schedule a service.
Healthcare providers must give you the estimate — within a specific time frame — before you get the item or service. This timeline depends on when you schedule the procedure and request an estimate.
While it's required for healthcare providers to provide a GFE, you may have to ask for it. Make a point to request the estimate when you schedule a procedure. Doing this can help make sure you have your projection prices before the appointment.
What is the No Surprises Act?
The No Surprises Act protects you from unexpected medical bills. It applies if you're covered under a commercial health insurance plan and have received certain health services after January 1, 2022. Those services include:
Most emergency services
Non-emergency services from out-of-network providers at in-network facilities
Services from out-of-network air ambulance service providers
The act bans most surprise medical billing charges from emergency services. It also defines ways for uninsured and self-pay individuals to dispute a bill if it's much higher than the provider's GFE.
The act also applies to commercial health insurance through an employer, an Affordable Care Act marketplace, or a plan bought directly from an insurance company. It does not apply to government insurance including Medicare, Medicaid, the Indian Health Service, Veterans Affairs Health Care, or TRICARE. This is because these programs already have billing protections.
If you have commercial health insurance, providers and facilities are required to give you publicly available and accessible information about medical billing protections. You should be able to view this information by:
Visiting a provider or facility’s website
Accessing a link on their website that leads to the protections
Viewing a 1-page notice with easy-to-understand language in a common area of the facility, such as a patient check-in location
Providers also should tell you who to contact if medical billing protections are violated.
What is surprise billing in healthcare?
Before the No Surprises Act, healthcare providers could charge individuals extra for medical services from out-of-network providers or facilities. People with private (or commercial) insurance would then be responsible for the rest of the cost not covered by their health plans. This is known as balance billing.
The No Surprises Act bans balance billing for people with private insurance. Individuals with government insurance — such as Medicare and Medicaid — already have protections against surprise billing. At the same time, the act creates a new right to GFEs to give uninsured individuals their expected medical costs in advance.
What should you do if your final bill doesn’t match your good faith estimate?
If the final bill is $400 or more than the GFE you received before the medical service, reach out to the healthcare facility or provider.
Ask if they can update the bill to match the GFE or try to negotiate a lower price. You also should ask if you're eligible for any financial assistance programs.
If you can't get a resolution, you can file a dispute with the U.S. Department of Health and Human Services. You must file the claim within 120 days of the date on the bill and pay a $25 fee. You can begin a dispute online, by mail, or by fax. You can get help by contacting the No Surprises Help Desk at 1-800-985-3059. Assistance includes starting a dispute in a language other than English.
The agency will decide if you can have the bill lowered or if the higher cost is justified. If the agency decides the cost is justified, you will be required to pay the bill.
Does the No Surprises Act apply to out-of-network providers?
The No Surprises Act addresses charges from out-of-network providers billed to people with insurance. The focus is on protections from balance billing.
You should not get a surprise bill for non-emergency services from an out-of-network provider without being notified and agreeing to the charges in advance.
Providers and facilities that are out of your insurance plan’s network cannot charge you more for emergency services than they would for in-network costs you share with your health insurance. This also applies to out-of-network providers of air ambulance services. Ground ambulances are exempt from the No Surprises Act’s protections.
The bottom line
A good faith estimate (GFE) can help you avoid medical debt if you don’t have health insurance or prefer to self-pay. With upfront prices for an item or service, you can plan for the cost of medical expenses. If you are uninsured or will pay out of pocket, healthcare providers must provide a GFE if you ask for one.
If your final bill is $400 or more above the GFE, you may be able to negotiate with the provider to get closer to the projected price. If you received a bill much higher than your GFE, you have the right to a formal dispute process, but keep in mind that filing a claim will cost $25.
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References
Centers for Medicare & Medicaid Services. (n.d.). Balance billing- Surprise bills.
Centers for Medicare & Medicaid Services. (n.d.). Good faith estimate for health care items and services.
Centers for Medicare & Medicaid Services. (n.d.). No surprises: What’s a good faith estimate?
Centers for Medicare & Medicaid Services. (n.d.). Patient provider dispute resolution initiation form.
Centers for Medicare & Medicaid Services. (n.d.). The no surprises act’s good faith estimates and patient-provider dispute resolution requirements.
Centers for Medicare & Medicaid Services. (2022). Medical bill disagreements if you’re uninsured.
Centers for Medicare & Medicaid Services. (2022). Model disclosure notice regarding patient protections against surprise billing.
Centers for Medicare & Medicaid Services. (2022). New protections for you.
Centers for Medicare & Medicaid Services. (2022). No surprises: Understand your rights against surprise medical bills.
Centers for Medicare & Medicaid Services. (2022). Resolving billing disagreements.
Centers for Medicare & Medicaid Services. (2022). Standard form: “Good faith estimate for health care items and services” under the no surprises act.
Centers for Medicare & Medicaid Services. (2022). Understanding costs in advance.
Indian Health Service. (n.d.). Home.
Tricare. (n.d.). Home.
U. S. Department of Health and Human Services. (2021). Guidance on good faith estimates and the patient-provider dispute resolution (PPDR) process for providers and facilities as established in surprise billing, part II; interim final rule with comment period (CMS 9908-IFC).
U.S. Department of Health and Human Services. (2022). Frequently asked questions for providers about the no surprises rules.
U. S. Department of Veterans Affairs. (2022). VA health care.
This article is solely for informational purposes. This article is not professional advice concerning insurance, financial, accounting, tax, or legal matters. All content herein is provided “as is” without any representations or warranties, express or implied. Always consult an appropriate professional when you have specific questions about any insurance, financial, or legal matter.
