The No Surprises Act, passed in 2020 and implemented in 2022, was designed to protect patients from unexpected out-of-network bills. But embedded in it is a federal independent dispute resolution process that lets out-of-network providers contest what insurers paid them — and it’s becoming increasingly controversial.
The process utilizes “baseball-style” arbitration, when both sides submit a number and an arbitrator picks one.
Providers have been prevailing in roughly 88% of payment determinations according to data from the Brookings Institute, with winning awards landing at three to four times comparable in-network rates.
That track record is not lost on practitioners who have spent years watching commercial payers offer reimbursement at or below Medicare rates. Anthony Maioriello, MD, founder and owner of Comprehensive Level One Staffing in Dallas, which specializes in surgical staffing and hospital service line development, made the case plainly at the Becker’s Spine, Orthopedic and Pain Management-Driven ASC + The Future of Spine Conference in Chicago June 11.
“What is your motivation to sign a contract that gives you Medicare, or in Dallas, less than Medicare?” Dr. Maioriello said. “Why would you do that?”
Dr. Maioriello also runs Level One Revenue Recovery, which helps physicians and facilities arbitrate underpaid out-of-network claims through the NSA’s IDR process. He described walking away in 2015 from $4.5 million in accounts receivable after commercial payers repeatedly refused to pay what he billed. That was before the No Surprises Act.
“Nobody would pay us,” he said. “That was before the No Surprises Act.”
The arbitration awards he now sees, he said, typically run eight to 12 times the original insurer payment. The scale of that gap, he argues, is a direct reflection of how low initial insurer offers are — not of providers gaming the system.
“Until they start offering more than $1,000 for a case or $2,000 for a case, we’re going to have these really large awards,” he said.
That argument cuts directly against the framing that has dominated coverage of NSA arbitration in recent weeks. The New York Times reported June 29 that in a few cases. surgical assistants — who typically earn 16% of a surgeon’s reimbursement — are now collecting up to 25 times what the operating surgeon makes by filing claims through the IDR process. In one case cited in the report, an assistant in Dallas won $50,456 through arbitration for a prostate removal procedure; the surgeon who performed the operation and accepted the patient’s insurance was paid $1,843. Brady Connaughton, a New Jersey lawyer who advises union health plans, called the pattern a disregard for the law’s intent.
The operational logic Dr. Maioriello laid out at the conference goes deeper than simply winning arbitration cases. His argument is that network participation carries a cost that most practices systematically undercount: the administrative overhead required to generate enough volume to justify discounted contract rates. More staff, more denial management, more infrastructure to keep the referral pipeline running. When practices model that math honestly, he said, fewer higher-paying cases often beat more lower-paying ones.
“Is it better to do 40 cases a month and make X or 10 cases a month and make X?” he said. “It’s better to do 10 cases a month and make X because you don’t have to have as much staff, you don’t have to have as big of a machine to keep that funnel coming in.”
He said that he is not arguing that practices should drop every contract. The calculus depends on market, specialty and payer mix, and he underscored that the strategy works best selectively. Practices could consider staying in network with a dominant payer, go out of network with those that consistently underpay, and use IDR arbitration to recover on emergencies and call cases covered by the NSA’s inadvertent provider designation — the provision that covers physicians patients do not choose in advance, including anesthesiologists, radiologists and surgical assistants.
“That concept of not killing yourself to make more money — how do I just be smarter about what I’m doing?” Dr. Maioriello said. “I think we all have to do that, especially when we’re all struggling to get paid.”
For health plan executives, the concern is exactly that providers are getting smarter. Thomas Nyhan, executive director of TeamCare, a health plan covering about half a million union workers, told The New York Times that his plan has spent $19 million on arbitration cases since 2022. His warning was pointed: as out-of-network arbitration becomes more lucrative, providers may have less incentive to join insurance networks at all.
Awareness of the IDR process is still uneven among providers, Dr. Maioriello noted — many haven’t heard of it, or have been put off by what he characterized as insurer-driven negative press about large awards.
“A lot of it is either no one’s heard about it, or there’s a misunderstanding about it,” he said. “Or, now, there’s negative press about it because the insurance companies, instead of paying the bill, they’re just putting out negative press.”
Whether the arbitration system holds in its current form is an open question. The process applies only to commercial insurance and only to out-of-network providers at in-network facilities. For now, the trajectory of dispute filings suggests the strategy is spreading. Regulators originally projected roughly 17,000 arbitration cases a year under the law. About 2.6 million arbitration cases were filed in 2025 alone, according to a PwC analysis — a volume the law’s architects never anticipated.
At the Becker’s 32nd Annual Meeting: The Business and Operations of ASCs, taking place October 29-31 in Chicago, ASC leaders, surgeons and healthcare executives will explore strategies to drive growth, enhance operational performance, navigate reimbursement challenges and prepare for the future of ambulatory surgery. Apply for complimentary registration now.