No Surprises Act IDR rule overhaul: Creating a more functional dispute resolution process
By: Randy Pilgrim, MD, FACEP, FAAFP | Enterprise Chief Medical Officer
The federal government has finalized significant changes to the IDR process—the most substantial update to the program since its implementation. The new rule, issued by the Departments of Health and Human Services, Labor, and Treasury, aims to improve efficiency, transparency, and communication between health plans and clinicians while addressing operational issues that have challenged participants.
Although the rule focuses on payment disputes, its broader significance lies in reinforcing a law that has already delivered for patients. The No Surprises Act has been a clear success — sparing patients from surprise bills and keeping them out of disputes between health plans and clinicians. This rule does not change what the law protects; it strengthens the process behind it, so payment disputes are resolved fairly and efficiently while patients stay out of the middle. This is good and necessary work: a more dependable process lets clinicians spend less time navigating administrative hurdles and more time caring for patients.
A system under strain
Congress enacted the No Surprises Act to protect patients from unexpected medical bills by removing them from the middle of payment disputes between health plans and clinicians. The law created the federal IDR process, which relies on independent third-party arbitrators to resolve disagreements about appropriate payment for clinical services.
While the law succeeded in shielding patients from surprise bills, the IDR process has been under significant pressure as far more cases were initiated than policymakers anticipated, creating backlogs and administrative issues for payors, clinicians, and regulators.
Many stakeholders have pointed to inconsistent communication, uncertainty around eligibility data, minimal engagement during open negotiations, and operational inefficiencies as key contributors to the growing volume of disputes. The new rule aims to address these issues and many more by creating a more transparent system.
What the No Surprises Act IDR rule addresses
The Final Rule is intended to make the dispute resolution process function more efficiently while encouraging earlier communication between payors and clinicians. By improving transparency and administrative processes, the rule supports the original goals of the No Surprises Act and helps to ensure that IDR remains an effective backstop when needed.
The NSA Operations Final Rule addresses several key domains:
- Enhanced open negotiation requirements. Successful Open Negotiation requires no fees, brings two parties together, and avoids the need for IDR. To date, a small minority of disputes are resolved in Open Negotiation in part because of the lack of engagement in the process. Parties must now initiate Open Negotiation and the other party must respond within a specified time (15 days) through a federal IDR portal. This portal will create a documented record of when negotiations begin and end.
- More payor transparency and standardized eligibility codes. To reduce the number of ineligible IDR claims due to the lack of information, the Final Rule requires that insurers provide additional identifying data. Health plans must use specific codes to indicate whether a claim is eligible for the federal IDR process to improve communication and reduce wasted time and resources on ineligible submissions. The Center for Consumer Information and Insurance Oversight (CCIIO) released significant guidance on July 17, with specific requirements. Health plans must comply with this guidance by January 1, 2027.
- Faster eligibility determinations. Certified IDR entities must determine eligibility within five business days after selection to help prevent delays that have slowed the dispute resolution process.
- Expanded batching allowances. Similar claims that meet certain criteria can now be grouped into a single dispute with up to 50 line items per batch, reducing the burden of filing individual claims, enhancing administrative efficiency, and reducing cost.
- Reduced administrative fees. The fee to enter the IDR process drops from $115 to $15 per party, per dispute. This makes the process more accessible, particularly for smaller and independent medical practices, and aligns the cost of the IDR program with CMS’ actual expenses.
What the industry can expect
Of all the changes in this rule, the emphasis on communication and transparency between payors and clinicians may be the most consequential in the long term. The rule encourages both sides to engage earlier and more substantively in payment discussions. Better communication up front should help parties identify eligible claims earlier and potentially resolve more disputes voluntarily before third-party arbitration.
For emergency physicians and hospitals, resolving disputes before entering the IDR process is about more than efficiency alone. Resources devoted to navigating payment disputes are resources that could otherwise be directed toward patient care, workforce support, and operational improvements. Ultimately, a more efficient IDR process benefits not only payors, clinicians, and hospitals, but also patients who depend on a stable and sustainable health care system.
What still needs to happen
The final rule represents meaningful progress, but it is not the total solution.
The IDR process should be viewed as a last-resort safeguard, not a business strategy. In an ideal system, fair and transparent reimbursement discussions would keep more clinicians in network and resolve most disagreements during negotiation, reducing the need for formal dispute resolution. IDR is essential precisely because when negotiations fail, it stands ready as an independent, efficient, and legally compliant path to resolution, not because it is intended to replace fair contracting between health plans and clinicians.
Protecting patients from surprise medical bills remains the central achievement of the No Surprises Act. Preserving that success should be the guiding principle for future improvements.
The next challenge is ensuring that the dispute resolution framework operates efficiently, encourages meaningful negotiation, and supports fair reimbursement across the health care system. While this rule does not solve every challenge, it moves the program in that direction by strengthening communication, improving operational efficiency, reducing administrative costs, and reinforcing accountability through the dispute resolution process.
Continued collaboration among regulators, health plans, and clinicians will be essential to ensuring the system continues to function as Congress intended—protecting patients while supporting fair payment and a sustainable health care system.
