What Is Out-of-Network Medical Billing?
Out-of-network medical billing occurs when a healthcare provider delivers services to a patient whose insurance plan does not include that provider in its contracted network. In these situations, there is no pre-negotiated rate between the provider and the payer, which means reimbursement is determined after the fact through a combination of billed charges, payer policies, and — increasingly — third-party repricing vendors.
OON billing matters because it affects a significant share of revenue for many specialties, particularly emergency medicine, anesthesiology, radiology, and surgery. When a provider is out of network, the gap between what they bill and what they actually collect can be enormous. Without a dedicated strategy, most practices accept whatever the payer offers — leaving tens or hundreds of thousands of dollars uncollected every year.
Understanding OON billing is no longer optional. Between payer vendor repricing, the No Surprises Act, and shifting reimbursement methodologies, providers need a clear framework for how OON revenue actually works — and how to protect it.
How OON Reimbursement Actually Works
When a provider submits an OON claim, the payer does not use a contracted rate. Instead, the insurer determines an "allowed amount" based on one of several methodologies: usual, customary, and reasonable (UCR) rates, a percentage of Medicare, or — most commonly now — a rate set by a third-party repricing vendor. The difference between the billed charge and the allowed amount is what the provider either writes off or fights to recover.
UCR rates are supposed to reflect what providers in a given geographic area typically charge for a specific service. In theory, this should produce fair reimbursement. In practice, payers and their vendors use proprietary databases that consistently undervalue services, sometimes paying less than Medicare for procedures that should reimburse at two to four times that rate.
The result is a system where the provider bills a fair rate, the payer applies an artificially low allowed amount, and the provider is left with a fraction of what the service is worth. Without active negotiation and appeals, this cycle repeats on every OON claim.
The Payer Vendor Problem: Zelis, Multiplan, and Viant
One of the biggest obstacles to fair OON reimbursement is the role of third-party repricing companies. Zelis (formerly Stratacare), Multiplan, and Viant are the three dominant vendors in this space. Insurance companies hire these firms to reduce their OON claim costs, and the vendors are paid a percentage of what they save — creating a direct financial incentive to drive provider payments as low as possible.
Here is how it typically works. A provider submits a claim for a procedure billed at fair market value. The payer routes that claim through a repricing vendor. The vendor applies its proprietary rate schedule and returns a drastically reduced allowed amount — often 40 to 70 percent below what the provider billed. The provider receives an Explanation of Benefits showing the reduced payment, sometimes with little transparency into how the rate was calculated.
Most providers do not realize these reductions are negotiable. The initial payment from a repriced claim is not final. It is a starting point, and providers who treat it as the end of the process leave significant revenue on the table. Identifying which claims have been vendor-repriced and systematically challenging those reductions is one of the highest-value activities in out-of-network billing.
The No Surprises Act and OON Billing
The No Surprises Act, effective January 2022, fundamentally changed the OON billing landscape. The law prohibits balance billing for emergency services, air ambulance services, and non-emergency services at in-network facilities where the patient did not have the opportunity to choose an in-network provider. Patients are now only responsible for their in-network cost-sharing amounts, regardless of whether the provider is in or out of network.
For providers, the NSA introduced the Independent Dispute Resolution (IDR) process — a federal arbitration mechanism for resolving payment disputes on OON claims. When a provider disagrees with a payer's initial offer, either party can initiate IDR, where a certified arbitrator selects between the provider's and the payer's proposed payment. The arbiter considers factors including the qualifying payment amount, provider training, market share, patient acuity, and prior contracted rates.
The IDR process creates a real path to fair reimbursement, but only for providers who know how to use it. Preparing a winning IDR case requires UCR benchmarking data, Fair Health reference points, clinical documentation, and a structured argument for why the payer's offer is inadequate. Providers without this expertise often lose IDR cases or never file them in the first place. For a deeper look at how the NSA works, see our non-contracted solutions overview.
How to Maximize OON Reimbursement
Maximizing out-of-network revenue is not about billing higher or gaming the system. It is about ensuring that every claim is paid at a rate that reflects the actual value of the service. Here are the core strategies that high-performing OON practices use.
1. UCR Benchmarking
Every OON negotiation should start with data. UCR benchmarking uses databases like Fair Health and PHCS to establish what providers in your geography and specialty actually charge for a given procedure. This gives you an objective basis for challenging underpayments and a defensible position in appeals and IDR cases. Without benchmarking data, you are negotiating blind.
2. Active Payer Negotiation
The initial payment on an OON claim is almost never the best the payer can do. Active negotiation means contacting the payer directly, presenting your UCR data, and requesting reconsideration of the allowed amount. Many payers will increase reimbursement when presented with credible data, because the cost of IDR or litigation exceeds the cost of paying a fair rate. The key is having a systematic process — not just one-off phone calls.
3. Multi-Stage Appeals
When negotiation fails, formal appeals are the next step. A multi-stage appeal process escalates the claim through the payer's internal review hierarchy, then to external review if necessary. Each stage should include additional supporting documentation — clinical notes, UCR data, Fair Health percentiles, and a clear narrative explaining why the current reimbursement is insufficient. Most practices give up after the first denial. The practices that recover the most money are the ones that persist through every available appeal level.
4. Dedicated OON Layer
The highest-performing practices separate OON billing from their standard RCM workflow. A dedicated OON billing layer means having specialists who focus exclusively on OON claims — tracking vendor-repriced EOBs, filing targeted appeals, initiating IDR cases, and negotiating directly with payer representatives. This separation ensures OON revenue does not fall through the cracks of a general billing operation.
What REL1EF Does Differently
REL1EF operates a dedicated OON negotiation layer on top of full-cycle revenue cycle management. Every OON claim is flagged, benchmarked against UCR data, and routed through a multi-stage recovery process that includes payer negotiation, formal appeals, and IDR filing when appropriate. The result is OON reimbursement of up to four times Medicare rates on procedures that payer vendors would otherwise reprice to a fraction of billed charges.
The model is no-win, no-fee: REL1EF only earns when the practice collects. There is no setup cost, no monthly retainer, and no risk. Providers who want to see the process in action can start with a free A/R recovery trial — REL1EF works existing aged receivables at no upfront cost, and the practice keeps everything recovered above the fee.
For practices that are tired of watching OON revenue disappear into payer vendor repricing, a structured recovery process is the single highest-ROI change they can make. The money is already owed. It just needs to be collected.