How the No Surprises Act Works

Before the NSA, patients often found themselves stuck in the middle of billing disputes—such as visiting an in-network hospital but being treated by an out-of-network provider, or needing emergency care with no choice of provider. Surprise bills were common and sometimes financially devastating.

The NSA, which went into effect in 2022, changed this by:

• Removing patients from insurer-provider payment disputes
• Requiring 30 days of open negotiation between insurers and providers on payment amounts
• Allowing either side to enter the IDR process if negotiations fail

The IDR process is straightforward: the provider submits a payment request, the insurer submits their offer, and a neutral arbitrator chooses one of the two. This mechanism was intended as a last resort—not a routine revenue tool.

Rising Controversy Over IDR

Recent lawsuits highlight how the IDR process may be misused. In January 2026, Anthem Blue Cross Life and Health Insurance Company filed a lawsuit against 11 Prime Healthcare facilities in California. Anthem alleges that these facilities “flooded” the IDR process with more than 6,000 ineligible disputes, resulting in millions in “wrongfully obtained awards.”

Elevance Health (Anthem’s parent company) reports similar issues in other states, including Georgia and Ohio. While lawmakers anticipated roughly 17,000 IDR cases per year, some providers are reportedly generating millions of disputes monthly.

Industry experts compare this to the 340B Drug Pricing Program, which grew beyond its original intent. Michael Abrams of Numerof & Associates notes, “The IDR process was invented for good reasons… but it’s being repurposed by some hospitals as a revenue stream.”

What’s Next for the IDR Process

Experts argue that the IDR system has morphed from a patient-protection tool into a “high-stakes battlefield” between insurers and providers. Providers win roughly 85% of cases, often due to private equity-backed groups using automated, high-volume submissions.

While the No Surprises Act has successfully protected patients from surprise billing, the misuse of the IDR process is driving up costs behind the scenes—impacting premiums, employer healthcare costs, and the overall affordability of insurance. Reform may be needed to ensure that the system serves its intended purpose: patient protection, not profit maximization.

For healthcare providers navigating the complexities of the No Surprises Act, managing payment disputes efficiently is critical. No Surprise Bill offers specialized Independent Dispute Resolution services designed to support providers through the IDR process with accuracy, compliance, and strategic guidance.

Our team helps streamline dispute submissions, reduce administrative burden, and improve outcomes in arbitration. If your organization is dealing with out-of-network payment disputes, we can help you manage the process with confidence.