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Lawmakers are weighing competing bills to address problems in the No Surprises Act’s payment dispute system. One proposal would replace arbitration with a payment benchmark; another would penalize insurers that fail to pay arbitration awards on time. The best path forward and the extent of any legislative support remain unclear.
Congress is considering competing changes to the No Surprises Act after the number of payment disputes between insurers and out-of-network providers exceeded the government’s annual estimate. A bill introduced by Rep. Frank Pallone on October 8 would eliminate independent dispute resolution and use the law’s qualifying payment amount instead. A separate proposal would penalize insurers that fail to pay arbitration awards within the law’s 30-day deadline.
The law, enacted at the end of 2020, protects patients from many unexpected out-of-network bills, including bills for care at an in-network facility and emergency care. When an insurer and an out-of-network provider cannot agree on payment, they can turn to independent dispute resolution (IDR), where an arbitrator sets a payment amount after considering the parties’ offers and other factors. The system’s growing caseload and disagreements over awards have become a focus of congressional proposals.
Jack Hoadley, a professor emeritus at Georgetown University’s Center on Health Insurance Reforms, said most people expected arbitration to be used modestly and in a relatively low number of cases after negotiations failed. The government estimated 22,000 disputes a year, and Hoadley said there were more than 4 million disputes in 2025. Those figures describe the estimate and reported 2025 caseload; the source did not provide a comparison period or further detail on how disputes were counted.
Hoadley said arbitrators have sided with providers in about 85% of cases, and argued that this can encourage higher payment requests and help explain the increase in cases. Josh Hill, a partner at a law firm, said insurers have also stopped paying some awards. He cited a legal disagreement over whether providers can sue to collect them: two courts have ruled they cannot, while a lower court reached the opposite conclusion, according to Hill.
A Patient Protection Faces Payment Disputes
The No Surprises Act protects patients from certain unexpected out-of-network bills and also establishes a process for resolving payment disputes between insurers and providers. The debate concerns how much insurers pay providers when the parties cannot settle. Hoadley said that providers’ success in arbitration can encourage higher payment requests, and the reported volume of disputes has prompted proposals to change the process.
The proposals take different approaches to the reported problems. Pallone’s bill would replace arbitration with a benchmark based on the qualifying payment amount. Murphy’s proposal would impose penalties and expand reporting related to insurers’ payment of arbitration awards. Physicians’ organizations oppose eliminating IDR, while consumer group Families USA supports Pallone’s bill. Their positions reflect different views on the proposed changes.
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How the IDR Process Developed
The No Surprises Act was passed at the end of 2020 to protect patients who receive out-of-network care at in-network facilities. The law established a qualifying payment amount, or QPA, intended to approximate the median in-network rate for comparable care. If providers and insurers cannot agree on payment, an arbitrator sets an amount after considering the parties’ offers and other factors.
Hoadley said regulators initially proposed treating the QPA as the default, but federal courts rejected that presumption and required arbitrators to consider other factors. Separately, Hill said insurers have stopped paying some awards, and courts are considering whether providers can sue to collect them. The source reports that cases concerning collection are pending in Maryland and Virginia.
Pallone, the ranking member of the House Energy and Commerce Committee, introduced his proposal on October 8, 2026. Rep. Greg Murphy, a Republican from North Carolina, first introduced his proposal in September 2024. It would require insurers that miss the 30-day payment deadline to pay penalties and would expand reporting on which insurers pay awards.
“Most people did expect arbitration to be used modestly in a relatively low number of cases.”
— Jack Hoadley, professor emeritus at Georgetown University’s Center on Health Insurance Reforms
Legislative and Court Outcomes Remain Open
It is not clear whether either bill has enough support to pass, whether lawmakers will combine elements of the proposals, or what final language might emerge. The source does not say whether Pallone’s bill would retain any exceptions to QPA-based payments.
The legal question over providers’ ability to sue for unpaid awards remains unsettled in the cases described by Hill. Cases pending in Maryland and Virginia could reach another appeals court, he said; a split among appeals courts could prompt the Supreme Court to consider the issue, but that outcome is not assured. The report does not quantify how many awards have gone unpaid or establish why the caseload grew so sharply.
Congressional Action and Court Rulings
Congress may consider the competing approaches: Pallone’s proposal to replace IDR with the QPA, and Murphy’s proposal to add penalties and reporting requirements for late or missing award payments. The source does not identify a date for hearings or a vote. Lawmakers could also pursue other changes; Hoadley said he believes a solution will likely require congressional action rather than an administrative fix.
Separately, courts may clarify whether providers can sue to collect unpaid awards. Decisions in the pending Maryland and Virginia cases could affect that question, though their timing and any further appeals are unknown. For now, the law’s patient protections remain in place, while debate continues over how insurers and providers resolve and enforce payment decisions.
Key Questions
What change would Rep. Frank Pallone’s bill make?
As described in the report, the bill would end the arbitration system and use the qualifying payment amount, or QPA, to determine payment instead.
What does Rep. Greg Murphy’s proposal do?
Murphy’s bill would require penalties for insurers that miss the 30-day award-payment deadline and more reporting on which insurers pay arbitration awards.
Are patients losing No Surprises Act protections?
The report describes proposals concerning payment disputes between insurers and providers. It does not report that the law’s patient protections have been repealed or changed.
Why is the dispute process under scrutiny?
Hoadley said the government expected 22,000 disputes annually, while more than 4 million entered arbitration in 2025. Hill also raised concerns about unpaid awards and differing court rulings on whether providers can sue to collect them.
When will Congress decide on the proposals?
The source gives no hearing or vote date. The proposals remain under consideration, and the timing of any legislative action is unclear.
Source: medpagetoday.com
