Healthcare Data GlossaryPayer
Balance Billing: Definition and Healthcare Context
Full name: Balance Billing / Surprise Billing
Balance billing is the practice by which an out-of-network provider bills a patient for the difference between the provider's charge and the amount the patient's insurer pays — the 'balance'. The No Surprises Act prohibits balance billing in specified circumstances: emergency services, air ambulance transport, and non-emergency services at in-network facilities when the patient had no prior informed choice of provider. Medicare and Medicaid programs have long-standing limits on provider balance billing.
Last updated: 2026-06-17Reviewed by: Dr. Jennifer Montecillo, MD — Gullas College of Medicine, 2019. Non-practicing medical reviewer.
How it’s used
- CMS NPPES NPI Registry: provider network status — derived from NPPES data and supplemented by insurer MRF directory data — is a key input in balance-billing compliance determinations.
- No Surprises Act: the NSA prohibits balance billing for emergency and specified out-of-network services, the statutory boundary Fonteum's surprise-billing compliance research applies.
- Insurer machine-readable files (Transparency in Coverage Rule): payer MRFs publish in-network rates that determine when a patient bill crosses into prohibited balance billing.
Frequently asked questions
- What is balance billing?
- Balance billing occurs when an out-of-network provider charges a patient for the difference between their billed rate and what the patient's insurer paid.
- Is balance billing legal?
- In many circumstances it is now prohibited under the No Surprises Act for emergency services, air ambulance, and unplanned out-of-network care at in-network facilities.
- What is the difference between balance billing and surprise billing?
- Surprise billing refers specifically to unexpected balance bills received after the fact — typically after emergency or inadvertent out-of-network care.