By Kennah Watts and Jack Hoadley
The No Surprises Act (NSA) bans suppliers and amenities from sending shoppers stability payments for sure providers and thus protects shoppers from shock out-of-network (OON) payments in sure eventualities. When an OON supplier and a payer can’t agree on a cost quantity, the events might enter into the impartial dispute decision (IDR) course of. When this occurs, each events submit a cost quantity and rationale, then a third-party arbitrator (IDR entity) selects and binds each events to 1 provide. The IDR entities are required to “decide an applicable cost quantity” and have come to play an instrumental function in OON funds.
The Facilities for Medicare and Medicaid Providers (CMS) commonly launch public use information (PUFs) on circumstances resolved by way of the IDR course of. These information make clear dispute outcomes and the prevailing occasion cost quantities. The PUFs enable researchers to look at tendencies in IDR use and to evaluate the effectiveness of NSA implementation. Earlier evaluation has proven unexpectedly excessive use of the IDR course of, largely by a small set of private-equity-backed supplier organizations, with suppliers successful the overwhelming majority of circumstances and successful massive awards. This text builds on our earlier evaluation to debate IDR entities’ function within the IDR course of and outcomes. Whereas IDR entities usually are not recognized within the PUFs, we developed a way to determine the IDR entities, and we report right here on their dispute volumes, determinations in favor of suppliers, and days to dedication. As related, we additionally embrace observations from semi-structured conversations with stakeholders concerned within the IDR course of.
Background
After dispute initiation, the events should choose an IDR entity inside three enterprise days. Each events have the chance to recommend or veto IDR entities. If there isn’t a settlement, the Departments randomly choose an IDR entity. In 2022, CMS licensed 13 organizations to function IDR entities. As established within the NSA and described by CMS, to be licensed, entities should show experience in arbitration and claims administration; managed care; billing and coding; and well being care regulation. Whereas some entities range in providers supplied, and most existed previous to the NSA, some work completely in IDR arbitration.
There are two charges assessed to the events on a declare: an IDR entity charge and an administrative charge. The executive charge is $115 per dispute (initially set by CMS steerage at $50 however then raised in 2024 by way of a last rule). Every IDR entity should choose an IDR entity charge quantity inside CMS’s present predetermined higher and decrease cost vary: from $200 to $840 for single claims and $268 to $1,173 for batched determinations. These charges can and have modified, as proven within the 2023 and 2022 lists of IDR entity’s charges for single and batched disputes.
Each events should pay the IDR entity charge up entrance. If the IDR entity determines the case is eligible and reaches a decision, the entity should refund the prevailing occasion’s charge. The entity retains the non-prevailing occasion charge as compensation, and IDR entities are solely paid for eligible circumstances. Each events should pay the non-refundable administrative charge, remitted to the Departments. If both occasion doesn’t pay, the opposite occasion prevails by default.
The IDR entity arbitrates the dispute and should take into account the qualifying cost quantity (QPA), amongst different elements designated within the regulation, and any extra non-prohibited info submitted by each events. Given the intent of the bipartisan congressional NSA sponsors to have OON billing disputes adjudicated pretty and impartially, one may anticipate determinations to be evenly cut up between payers and suppliers, however knowledge from 18 months of disputes signifies in any other case. In 2023, suppliers prevailed in 81 % of disputes, and within the first half of 2024, suppliers received 85 %. This vital skew raises questions of whether or not the patterns range throughout the IDR entities.
Methodology
Since IDR entities usually are not recognized within the PUF, we used two variables to moderately infer which entity decided which dispute: “IDR Entity Compensation” and “Size of Time to Make Willpower.” This technique depends on a number of assumptions; as such, the outcomes needs to be thought-about estimates relatively than definitive evaluation. We aimed to attract affordable patterns throughout entities and disputes to show broad tendencies in determinations.
The variable “IDR Entity Compensation” is outlined because the “greenback quantity representing the compensation for the licensed IDR entity for the dispute.” This subject thus corresponds with the publicly listed mounted and batched cost quantities for every IDR entity. We restricted our evaluation to single dedication disputes to pair the listed mounted charge quantity with the compensation and determine the person IDR entity. Isolating evaluation to single circumstances does restrict the scope of research: single disputes account for roughly 60 % of resolved disputes. All outcomes and reveals exclude the opposite 40 % of disputes that have been a part of batched circumstances.
Moreover, whereas this technique is correct, it’s incomplete, as a number of IDR entities might have the identical mounted charge, so we can’t determine them individually. In these cases, we didn’t assign the case to an entity as we couldn’t precisely distinguish the entities. For instance, each Federal Hearings and Appeals Providers and MCMC Providers, LLC have a 2024 single dedication mounted charge of $395, so we couldn’t correlate the reported compensation of $395 to a selected entity.
We used the “Size of Time to Make Willpower” variable to deduce the yr when the case was initiated and thus when the IDR entity charge was paid. For instance, for disputes from Q1 of 2024 with occasions to dedication higher than 410 days, we estimate the dispute was initiated in 2022. We performed this calculation to pair all disputes with the corresponding IDR entity mounted charge quantity for that yr. We show the resolved circumstances primarily based on the yr they have been initiated (12,007 whole circumstances for 2022; 227,706 for 2023; 137,450 for 2024).
With these variables and utilized methodologies, we recognized IDR entities for 89 % of single-determination circumstances initiated in 2022, 60 % in 2023, and 42 % in 2024. Provided that these limitations additionally hinder volume-based evaluation, it’s tough to evaluate how the evaluation could also be skewed consequently. As related, we pair our quantitative findings with observations from semi-structured conversations with a number of high plans, suppliers, and third-party intermediaries concerned within the IDR course of.
IDR Entities Diverse Extensively In How Typically They Dominated In Favor Of Suppliers
4 IDR entities favored suppliers in additional than 90 % of circumstances resolved within the first half of 2024, whereas one IDR entity favored suppliers in solely one-third of circumstances. For one IDR entity in a single yr, the share of disputes dominated in favor of suppliers was as excessive as 99 %. Conversely, the bottom share throughout years and IDR entities was 19 %, an 80 percentage-point distinction. The total distribution of determinations by IDR entity are proven in Exhibit 1 under.
Exhibit 1. Share of Recognized Single-Willpower Disputes Determined in Favor of Suppliers by IDR Entity, 2022 – Q2 2024
Supply: Writer’s evaluation of Federal IDR PUFs, Reporting Yr 2022, 2023, and Q1-Q2 2024.
Be aware: Every IDR entity was assigned a number one to 13, as proven on the x-axis. Lacking knowledge for sure years signifies when the IDR entity didn’t have a singular cost quantity and thus couldn’t be individually recognized. Graph solely consists of knowledge from single determinations and doesn’t embrace batched determinations.
Case Quantity Diverse Throughout Entities And Is Correlated To Outcomes
Quantity additionally different throughout IDR entities (Exhibit 2). For resolved single-determination circumstances estimated to be initiated in 2022, three IDR entities arbitrated almost three-fourths of all disputes. The share of disputes is extra evenly distributed among the many IDR entities that may very well be recognized within the first quarter of 2024, with six IDR entities every deciding 3 to five % of circumstances initiated in that quarter and the 2 highest quantity IDR entities deciding 7 % and 9 % of analyzed disputes.
Exhibit 2. Share of Recognized Single-Willpower Circumstances by IDR Entity, 2022 – Q2 2024
Supply: Writer’s evaluation of Federal IDR PUFs, Reporting Yr 2022, 2023, and Q1-Q2 2024.
Be aware: Every IDR entity was assigned a number one to 13, as proven on the x-axis. Lacking knowledge for sure years signifies when the IDR entity didn’t have a singular cost quantity and thus couldn’t be individually recognized. Graph solely consists of knowledge from single-determination circumstances and doesn’t embrace batched determinations.
The share of circumstances seems correlated with dedication outcomes: the IDR entities that rule in favor of suppliers are inclined to have increased case volumes. For instance, the highest IDR entity for resolved circumstances initiated in Q1-Q2 of 2024 determined greater than 90 % of circumstances in favor of suppliers. The bottom quantity IDR entity had lower than 1 % of all disputes and decided solely one-third in favor of suppliers. In our discussions with stakeholders, we heard that plans and suppliers might purposefully choose or veto explicit IDR entities, possible knowledgeable by inner knowledge on resolution tendencies. This veto technique might clarify how the IDR entities that the majority usually dominated in opposition to suppliers dominated on so few circumstances. Total decision-making patterns ought to ideally be related throughout all IDR entities, so will probably be vital to know why variations exist.
Lags In Days To Willpower Have Declined; Common Occasions Diverse By Entity
Variations are additionally obvious in IDR entities’ time to dedication (Exhibit 3). In 2022, IDR entities determined single-determination circumstances inside 131 days on common. Days to dedication different throughout the highest-volume IDR entities from 79 to 195 days. In 2024, whereas the general common dropped to 54 days, the highest-volume IDR entities averaged 51 and 80 days. Just one IDR entity had a median (31 days) near the statutory time to dedication of 30 days. Quantity doesn’t seem correlated to time to dedication, nor does it seem correlated to the IDR entities’ arbitration outcomes.
Exhibit 3. Common Days to Willpower of Recognized Single-Willpower Circumstances by IDR Entity, 2022 – Q2 2024
Supply: Writer’s evaluation of Federal IDR PUFs, Reporting Yr 2022, 2023, and Q1-Q2 2024.
Be aware: Every IDR entity was assigned a number one to 13, as proven on the x-axis. Lacking knowledge for sure years signifies when the IDR entity didn’t have a singular cost quantity and thus couldn’t be individually recognized. Graph solely consists of knowledge from single determinations and doesn’t embrace batched determinations.
Variability Throughout IDR Entities Underscores A Want For Higher Transparency
Our evaluation signifies that IDR entities range considerably of their decision-making practices regardless of expectations that choices can be constant throughout entities. Our stakeholder discussions recommend that events might strategically veto explicit IDR entities. Our evaluation sheds some gentle on variations already identified to supplier and payer stakeholders participating in IDR. Extra transparency within the PUFs would enhance our understanding of the IDR course of.
Equally, the rationale behind cost determinations stays unclear attributable to restricted transparency into how IDR entities consider submissions. Whereas IDR entities should disclose sure info to CMS on every dedication, such because the quantities of each events’ presents and the ultimate dedication quantity, they don’t seem to be required by statute to reveal the rationale for his or her choices (although the statute does enable the Secretary to require extra reporting). In our stakeholder discussions, each side stated that IDR entities’ stories on their dedication choices embrace minimal justification or rationale, restricted to imprecise checkmarks and boilerplate language. With out public reporting, a standardized rubric, or an auditing mechanism, observers can solely speculate on the premise for cost determinations. Stakeholders raised issues in regards to the credibility of submitted info, inconsistent sharing of case supplies, and lack of transparency on how historic funds or rationales submitted by the events transient might affect choices. Higher transparency, both by way of legislative mandates or regulatory steerage, might handle these issues.
The tempo of IDR entity resolution making can also warrant higher oversight by CMS. As our analyses present, the speed of filed circumstances continues to speed up quickly. The amount of ineligible circumstances continues to be excessive as nicely, elevating issues that ineligible circumstances are contributing to system inefficiency. Provided that IDR entities decide case eligibility and are solely paid for eligible circumstances, some stakeholders recommend that IDR entities are incentivized to find out ineligible circumstances as eligible. The IDR system wants a simpler technique of screening out ineligible claims, however IDR entities will not be ideally positioned for this process. Proposed guidelines which are pending on the federal businesses ought to assist handle delays in eligibility determinations, however wouldn’t resolve incentives for IDR entities to find out eligibility.
As the quantity of circumstances getting into the IDR course of continues to climb, IDR entities’ processes and determinations will proceed to be examined and scrutinized. Higher schooling, coaching, and oversight of IDR entities and their decision-making may assist scale back a number of the uncertainties within the present course of and enhance confidence for each the contesting events and the broader group within the affect on prices and premiums that the quantities paid are as honest as attainable.
Kennah Watts and Jack Hoadley “No Surprises Act Arbitrators Range Considerably In Their Choice Making Patterns” June 24, 2025, https://www-healthaffairs-org.proxy.library.georgetown.edu/content material/forefront/no-surprises-act-arbitrators-vary-significantly-their-decision-making-patterns. Copyright © 2025 Well being Affairs by Mission HOPE – The Folks-to-Folks Well being Basis, Inc.