New analysis points finger at payers for IDR problems

A new analysis from specialty medical societies shifts the blame to payers for ongoing challenges with the No Surprises Act's process for negotiating out-of-network payments.

The latest analysis from the American College of Emergency Physicians, the American College of Radiology and the American Society of Anesthesiologists suggests payers are to blame for their own problems – mostly because they fail to participate in the process.

Citing federal data, the groups said insurers lost on default in about a quarter of disputed line items in 2025.

The NSA's independent dispute resolution process is a baseball-style arbitration system used to settle out-of-network payment disputes between healthcare payers and providers without involving the patient. However, the process has faced heavy criticism since its launch in 2022, including bloated dispute volumes and overly high payments to providers.

In the quarter of cases payers lost on default, providers won because the payer did not participate in arbitration or failed to meet procedural deadlines, such as the five-day information request window. Under baseball-style arbitration, the arbiter must select an offer even if one side does not provide one and cannot negotiate its own payment amount.

Payers are also submitting unreasonably low offers for submitted disputes, the specialty groups explained. They found that payer offers last year were less than or equal to the QPA for nearly 40% of line items, excluding defaults.

In 8.2% of line items disputed last year, the offers were $1 or less, they added.

This comes amid payer complaints about the high rate of provider wins, with third-party arbiters favoring providers in about 85% of all finalized federal payment determinations, according to federal data. Those payouts also tend to be 2.5 to 4 times the qualifying payment amount, which represents an insurer's median in-network rate.

The specialty groups' report indicates that high provider win rates aren't a sign of a system that favors physicians, the groups explained.

"Patients and physicians should not be blamed for problems created by insurance company business decisions," Dr. Patrick Giam, ASA president, said in a press release. "When insurers choose to pass the cost of reasonable physician payments on to patients and employers rather than absorb those costs within their substantial revenues and profits, that is a choice to preserve their bottom line, not evidence that the No Surprises Act is failing."

The groups shared their analysis with Congress, which is keeping a close eye on the NSA and its IDR process following stark criticism from both sides and a growing body of evidence that the process is actually adding to healthcare costs rather than reducing them. One recent study out of Georgetown University estimated over $22 billion in additional costs from the IDR system in just four years.

Payers and employers are lobbying for Congress to scrap the baseball approach to the federal IDR process. Instead, they support a more straightforward benchmark payment system that ties out-of-network rates to a specific figure, such as Medicare rates or the QPA.

Providers remain in favor of the current approach, but frustrations around its administration are mounting.

ACEP, ACR and ASA urged lawmakers to identify true outlier providers, payers and arbiters and audit those cases, rather than provide blanket reforms for a system that can work. They also asked them to investigate whether payers are using defaults and low offers as strategies to pay providers less.

Additionally, Congress should enforce payer obligations, they said. That means requiring accurate QPA and eligibility information, good-faith open negotiation, participation in IDR and payment within 30 days after a determination.

Finally, they want to see recent changes to the IDR process play out. In May, the CMS finalized a rule that seeks to address key challenges of the process, including high administrative costs, communication failures during the 30-day open negotiation period and a decentralized system for tracking disputes.

"A fair and effective IDR process depends on accurate payment data, transparency, and accountability from all stakeholders," said Dr. Dana H. Smetherman, CEO of ACR.

Jacqueline LaPointe is an Executive Editor at Xtelligent Healthcare Media, covering revenue cycle management, healthcare payers, health policy, and health IT since 2016.