A recent report jointly released by AHIP and the Blue Cross Blue Shield Association indicates that as many as 39% of out-of-network claims sent to the federal independent dispute resolution (IDR) system were deemed ineligible. Insurers contend that some providers are flooding the process to secure higher payments.
In 2024, data showed that nearly 20 million healthcare claims qualified for federal surprise billing protections, effectively preventing the same number of surprise bills. Despite this, the cost of managing the arbitration program continues to climb significantly.
Approximately 76% of claims were resolved without further dispute when providers accepted the initial payment offered by the plan.
However, insurers argue that a substantial portion of disputes submitted to the federal IDR system should never have been filed because they did not meet legal eligibility requirements. According to the report, health plans classified 39% of all disputes as ineligible, including 45% of disputes involving non-emergency services.
Common issues included claims for services covered by Medicare or Medicaid, disputes that had already gone through IDR but were resubmitted, claims involving in-network providers, and claims governed by state-level surprise billing laws.
The report also highlights that IDR entities (IDREs) may be failing to flag many ineligible disputes, resulting in payment determinations being issued for cases that do not meet eligibility standards.
To address these challenges and reduce unnecessary administrative burden, practices seeking guidance on the Federal NSA IDR process and the broader Federal IDR process often turn to specialized resources such as No Surprise Bill, which supports providers in navigating dispute resolution requirements across both state and federal systems while improving reimbursement outcomes.
Implications
The IDR system was created under the No Surprises Act. Under this law, eligible items for IDR include out-of-network emergency services, non-emergency out-of-network services provided at in-network facilities, and out-of-network air ambulance services.
Eligibility for federal IDR payment also requires meeting procedural conditions, such as timing rules, participation in open negotiations, a cooling-off period, guidelines for bundling multiple claims into a single dispute, and absence of applicable state surprise billing protections.
Despite these hurdles, once arbitration decisions are finalized, plans pay nearly three-quarters of awards within 30 days, with 41% paid in just 15 days. Delays for qualified IDR cases are usually caused by provider submission errors, such as incorrect contact details or incomplete documentation, or by the high volume of IDR cases, the report noted.
AHIP and BCBSA emphasized that the IDR process itself is expensive, diverting funds that could otherwise be allocated to patient care or used to reduce premiums and out-of-pocket costs. Insurers further claim that some providers contribute to these costs by submitting excessive numbers of disputes, many of which are ineligible.
The No Surprises Enforcement Act, introduced in July, would impose fines on insurers that fail to pay physicians within 30 days after losing an IDR case.
Lawmakers noted that this legislation does not affect the patient protections under the No Surprises Act and will not increase out-of-pocket costs for patients.
