The No Surprises Act was designed to protect patients from unexpected medical bills. Four years into its implementation, the law’s independent dispute resolution process has generated new financial hurdles for physician groups.
Fort Worth-based Radiology Associates of North Texas recently projected more than $51 million in avoidable costs tied to the current system’s batching rules and unpaid IDR awards. The figure from Radiology Associates of North Texas captures in dollars what physician groups and specialty practices have argued since the IDR process launched in April 2022: that a system built to resolve billing disputes has instead created new ones, and that the administrative costs of navigating arbitration can exceed the value of the claims being disputed.
“We’ve been hearing a lot of problems with private payers, Kara Newbury, chief advocacy officer at the Ambulatory Surgery Center Association, told Becker’s. “I think that a lot of it is backlash to how the No Surprises Act has been implemented. But we had been hearing for a while from new ASCs that some payers were not willing to negotiate with them and have in-network contracts with new facilities. But now we’re hearing some issues even with existing facilities when they’re trying to renegotiate or update their contracts.”
Kimberly Cimino, PsyD, chief medical officer of an independent occupational medical group in Ohio, told Becker’s that insurer’s ability to delay NSA payments or draw out lengthy IDR processes disproportionately impacts smaller or independent practices.
“We have watched the No Surprises Act exacerbate a power dynamic that was already heavily tilted toward commercial payers,” she said. “Large insurers already held the upper hand, but they now frequently waste and misappropriate IDR resources because they know that independent, community-focused practices lack the extensive legal infrastructure, administrative bandwidth, or capital reserves required to withstand protracted billing fights.
In response to the widespread pushback from individual physicians, medical societies and healthcare organizations alike, lawmakers are evaluating two policies that could turn the tides on the NSA fallout.
On the regulatory side, HHS, CMS, the Labor Department and the Treasury Department finalized a rule May 28 overhauling the federal IDR process. The most immediate change is a reduction in the administrative fee from $115 per party per dispute to $15 — a cut of more than 85%. For specialty practices that dispute high volumes of lower-dollar claims, the prior fee structure effectively made arbitration economically unworkable.
The rule also lays the groundwork for the IDR Gateway, a single platform set to roll out in phases this year. The gateway will allow users to initiate disputes, track case status and manage activity in one place, replacing the web form system responsible for the 2022 backlog. In-portal negotiation tools are expected to follow.
Batching rules — which determine when multiple claims can be grouped into a single dispute to reduce costs — are also being expanded. Under the new rule, claims can be batched when they involve a single patient on the same or consecutive dates of service billed together, when they share the same service code, or when anesthesiology, radiology, pathology and laboratory claims fall within the same CPT code section. Batched disputes are capped at 50 line items.
The rule also formalizes the 30-business-day open negotiation period that precedes any IDR filing. Going forward, parties must initiate that period through the federal portal, with the opposing party required to respond by the 15th business day. Certified IDR entities must complete eligibility determinations within five business days of being selected. Federal officials said the change follows findings that many parties were bypassing meaningful negotiation, with some notices bundling thousands of items and services.
A new payment accountability measure is also included: if either party fails to pay its administrative or certified IDR entity fee by the time its offer is due, that offer will not be considered received. The financial obligation remains.
The second track of reform is moving through Congress. On May 11, the American Medical Association, all 50 state medical societies and 46 healthcare organizations sent a letter urging congressional leaders to support H.R. 4710/S. 2420, bipartisan legislation that would authorize penalties against parties that fail to comply with statutory payment timelines after final IDR determinations. The bill would also give federal regulators explicit authority to enforce IDR decisions — authority they currently lack.
The legislative push reflects a core enforcement gap that the new rule does not close. Even when arbitration ends in a provider’s favor, there is no guaranteed mechanism to compel payment. The legislation is intended to address that gap directly.
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