What does "balance billing" refer to?

Balance billing refers to the practice of billing the patient for the amount that remains after the insurance has processed a claim and paid its share. This typically occurs when a healthcare provider is not contracted with a patient's insurance plan, leading to the patient being responsible for the difference between the provider's charges and the insurance reimbursement.

For example, if a healthcare provider charges $1,000 for a service and the insurance company pays $600, the provider may then bill the patient for the remaining $400. This is a common practice in situations where the provider's fees exceed what the insurance is willing to pay.

Understanding this concept is essential, especially in states that have regulations governing balance billing, as these laws can protect patients from unexpectedly high bills after receiving care.