COVID-19, surprise billing and the cost of care

May 20th, 2020 / By Steve Delaronde

The fear of expensive medical bills is an ongoing impediment for patients seeking healthcare services and has only been compounded amid the COVID-19 pandemic. On March 18, 2020, the Families First and CARES Acts eliminated cost sharing for an evaluation visit where a coronavirus test is ordered. An FAQ updated by the Department of Health and Human Services on May 6 states that a provider who receives payments from the Provider Relief Fund cannot seek out-of-pocket payments from a patient beyond the amount they would be expected to pay for an in-network provider for “all care for a presumptive or actual case of COVID-19.” Could this signal the beginning of the end for surprise billing?

Surprise billing typically occurs when a patient receives treatment or services from a physician or lab that is outside of their insurance network, i.e., out-of-network, even in cases when the hospital itself is within the network. Surprise billing is an example of “balance billing,” in which a patient is billed for the difference between a provider’s charges and the allowed amount that an insurer has agreed to pay the provider. Twenty-nine states have enacted some form of balance billing protection, but there is no federal law that protects patients.

Some would argue that all bills for medical services are “surprise bills,” since the price of most medical services and procedures are unavailable prior to receiving the service. Even when prospective patients perform due diligence by getting an estimate of charges before a medical procedure, an accurate price is elusive. This is highlighted by the case of an insured man in Connecticut who obtained a cost estimate prior to undergoing a hernia repair and then received a bill that was 51 percent over the initial estimate.

The good news is that balance billing is not allowed for patients who are 1) diagnosed with COVID-19 or 2) have documentation in their medical record that “supports a diagnosis of COVID-19, even if the patient does not have a positive in vitro diagnostic test result in his or her medical record.” The bad news is 1) the ban on balance billing does not extend to non-COVID patients, and 2) the potential costs of coronavirus treatment to patients with employer health coverage can exceed $20,000 for an inpatient admission. A patient treated for a COVID-19 infection is still responsible for the costs associated with medical treatment as stipulated in their health insurance policy.

Healthcare costs are so concerning to Americans that a recent Gallup poll found 14 percent would avoid seeking care for a fever and a dry cough due to their ability to pay. COVID-19 patients that require treatment still face outrageous medical bills. Cost sharing waivers apply only to the evaluation visit and specific COVID-19 test. Other tests received during the visit may not be covered, and any future treatment required beyond the evaluation visit may still require that a deductible is met before full coverage is applied. 

Many private insurers have waived some cost-sharing for COVID-19 treatments. Cost-sharing for telehealth visits may also be waived, though some insurers require that deductibles are met before covering those services. Additionally, the 61 percent of workers that are in a plan completely or partially funded by their employer may not receive the same benefits. While many self-insured plans are voluntarily waiving cost-sharing for in-network and telehealth services related to treating COVID-19, this decision is up to the employer.

It is imperative that people are not discouraged from seeking COVID-19 testing and treatment due to fear of incurring high medical bills. There is too much at stake for the health of the individual, as well as the public. The pandemic has underscored the need to address a healthcare system that burdens Americans with unexpected and costly bills during a time when they are most vulnerable. While the federal government has created some consumer protections for COVID-19 patients through the CARES Act Provider Relief Fund, states are now in an optimal position to safeguard and extend these protections.

Steve Delaronde is director of consulting for Payer and Population Health Services at 3M Health Information Systems.

Visit the 3M HIS COVID-19 resource page.


During a pandemic, information is gathered, studied, and published rapidly without the usual processes of review. Our understanding is rapidly evolving and what we understand today will change over time. Definitive studies will be published long after the fact. We share our thoughts and expertise based on currently available information.