Could Congress Eliminate IDR? What the Latest No Surprises Act Proposal Means for Providers

For healthcare providers navigating the complexities of out-of-network reimbursement, the independent dispute resolution process has become an important mechanism for challenging disputed insurance payments.

Now, the future of that mechanism is facing a potentially significant turning point.

On October 8, 2026, three of the nation's leading physician organizations publicly opposed newly introduced legislation that could fundamentally change how out-of-network payment disputes are resolved.

The proposed Lower Premiums, Faster Payments Act would eliminate the federal independent dispute resolution (IDR) process established under the No Surprises Act, replacing it with a different framework for determining reimbursement.

Supporters argue that the current arbitration system is costly, inefficient, and vulnerable to abuse. Physician organizations warn that eliminating independent arbitration could give health insurers disproportionate influence over reimbursement rates.

For physicians, healthcare administrators, and revenue cycle management teams, the debate raises a fundamental question:

How can policymakers make out-of-network reimbursement more efficient without compromising the fairness of payment determinations?

The answer could shape the future of federal healthcare payment disputes.

Why Three Major Physician Organizations Are Opposing the Proposal

The American Society of Anesthesiologists (ASA), American College of Emergency Physicians (ACEP), and American College of Radiology (ACR) issued a joint statement opposing the Lower Premiums, Faster Payments Act, introduced by Representative Frank Pallone of New Jersey.

Their central concern is that the legislation would eliminate an independent mechanism for resolving disagreements between healthcare providers and insurers over out-of-network payments.

Under the existing No Surprises Act framework, qualifying payment disputes can proceed through a federal IDR process when providers and insurers cannot agree on an appropriate reimbursement amount.

Rather than allowing either party to determine the outcome unilaterally, an independent dispute resolution entity evaluates the competing offers under applicable federal standards.

The physician organizations argue that removing this independent review would weaken an important safeguard against inadequate reimbursement.

Their opposition is particularly significant because anesthesiologists, emergency physicians, and radiologists frequently provide services in hospital settings where patients may have little or no ability to choose an in-network physician.

Why this matters: These medical specialties are closely connected to the circumstances that prompted the No Surprises Act in the first place. Changes to out-of-network reimbursement could therefore have meaningful implications for their financial operations and contracting relationships.

Understanding the Purpose of Independent Dispute Resolution

To understand the controversy, it helps to revisit why the federal IDR process exists.

The No Surprises Act was designed to protect patients from certain unexpected medical bills arising from out-of-network care.

Before these protections, patients could receive substantial bills after obtaining services from out-of-network physicians, even when receiving treatment at an in-network hospital.

The law established protections that generally prevent patients from being held responsible for certain unexpected out-of-network charges beyond applicable in-network cost-sharing obligations.

However, protecting patients did not eliminate the underlying financial disagreements between healthcare providers and insurers.

Those disputes still needed a resolution mechanism.

Under the existing federal framework, eligible providers and insurers may negotiate reimbursement amounts. When negotiations fail, qualifying disputes can proceed to independent arbitration.

Certified IDR entities evaluate the competing offers and select one based on applicable statutory requirements and permissible information.

This structure separates the patient's financial protections from the dispute over how much the insurer should ultimately pay the provider.

For example, consider an emergency physician who provides covered treatment to a patient at a hospital.

The patient receives the protections applicable under the No Surprises Act, but the physician and insurer disagree about the appropriate reimbursement.

Under the current framework, the parties may be able to pursue federal IDR if the claim meets eligibility requirements.

The proposed legislation would substantially change that process, creating new considerations for providers that rely on arbitration to resolve eligible payment disagreements.

What the Proposed Legislation Seeks to Change

The Lower Premiums, Faster Payments Act is intended to address perceived shortcomings in the existing federal arbitration system.

Representative Pallone has characterized the current process as vulnerable to exploitation, arguing that inappropriate disputes and excessive arbitration costs can contribute to higher healthcare spending and insurance premiums.

From this perspective, eliminating the existing IDR structure is part of an effort to create a more predictable, efficient payment system.

According to the legislation's sponsor, the proposed replacement would base payments on median in-network rates and require payments within 30 days of claim submission.

The physician organizations opposing the legislation see the issue differently.

They argue that replacing independent arbitration with insurer-calculated payment rates could weaken providers' ability to challenge reimbursements they consider unreasonable.

The disagreement reveals competing priorities.

Supporters emphasize controlling costs, reducing administrative complexity, accelerating payments, and limiting misuse of the dispute process.

Opponents emphasize preserving an independent mechanism for resolving payment disagreements and preventing insurers from gaining excessive influence over reimbursement.

Both sides identify problems with the current system. The central disagreement concerns how those problems should be addressed.

For healthcare providers, the distinction is consequential. A streamlined payment framework could reduce administrative burdens, but its financial implications would depend heavily on how reimbursement amounts are calculated, whether meaningful safeguards remain, and what options providers have when payments are disputed.

Importantly, the legislation is a proposal, not an enacted change to the No Surprises Act. The existing federal IDR process remains operational.

What the Latest IDR Data Reveals About Insurer Participation

One of the physician organizations' strongest arguments concerns insurer behavior within the existing dispute resolution system.

In their October 8 statement, ASA, ACEP, and ACR cited federal data describing several patterns they believe demonstrate weaknesses in insurer participation and payment practices.

According to the figures highlighted by the organizations:

• 24.5%: The share of IDR line items in 2025 on which insurers reportedly failed to participate and lost by default.

• 8.2%: The share of line items on which insurers reportedly submitted offers of $1 or less.

• Nearly 40%: The share of insurer offers reportedly submitted at or below the qualifying payment amount, excluding defaults.

These figures were presented by the physician organizations as evidence supporting their concerns about insurer conduct.

They do not, on their own, establish that every low offer was inappropriate or that every default reflected the same underlying cause.

Nevertheless, they raise important questions about participation, offer amounts, and whether the existing process creates sufficient incentives for timely resolution.

Consider a hypothetical practice that repeatedly receives payments it believes do not adequately reflect the services provided.

If the practice can challenge those payments through an independent process, it has a formal avenue for seeking a different reimbursement determination.

Without an equivalent review mechanism, the practice's options may change considerably.

This is particularly relevant to smaller physician groups that may have fewer financial resources or less negotiating leverage than larger healthcare organizations.

Why the Qualifying Payment Amount Is Central to the Debate

Another important element of the controversy is the qualifying payment amount, commonly referred to as the QPA.

Under the No Surprises Act, the QPA generally reflects a plan's median contracted rate for a particular item or service, determined according to applicable rules.

It serves as an important reference point within the federal payment dispute framework.

However, the methodology used to calculate QPAs has been the subject of significant litigation.

In August 2026, the U.S. Court of Appeals for the Fifth Circuit ruled against certain aspects of the federal QPA calculation methodology.

The decision addressed the inclusion of so-called ghost rates, meaning contracted rates associated with services a provider does not actually furnish.

The court also addressed the treatment of bonuses and incentive payments in QPA calculations.

Why is this relevant?

Because the accuracy and representativeness of payment benchmarks can influence reimbursement disputes.

For example, if a benchmark incorporates contractual rates for services a physician does not perform, questions may arise about whether those rates accurately reflect relevant negotiated payments.

Likewise, excluding certain forms of contractual compensation could affect how the resulting benchmark represents the underlying agreements.

The physician organizations argue that changes to these calculations should be fully addressed before Congress considers eliminating the existing arbitration framework.

Their concern is that policymakers could fundamentally restructure the payment process before the effects of court-directed adjustments become clear.

For providers, this reinforces the importance of understanding not only reimbursement offers but also the methodologies and documentation underlying payment calculations.

Why the Timing of the Proposal Matters

The legislation arrives shortly after federal agencies finalized significant reforms intended to improve the existing IDR process.

In May 2026, the Departments of Health and Human Services, Labor, and Treasury, along with the Office of Personnel Management, finalized an IDR Operations Rule designed to address longstanding administrative challenges.

Among its objectives are improving communication between insurers and providers, clarifying procedures, strengthening transparency, and making dispute resolution more efficient.

The rule also addresses operational issues that have contributed to delays and administrative burdens.

However, implementation is occurring in stages.

As a result, some reforms have not yet had sufficient time to demonstrate their full operational impact.

This creates an important policy consideration.

If existing reforms are intended to reduce inappropriate disputes, improve information sharing, and streamline processing, should policymakers evaluate their results before pursuing a fundamentally different payment framework?

The physician organizations believe Congress should allow these reforms to take effect before considering the elimination of independent arbitration.

At the same time, supporters of broader legislation argue that the scale of current administrative challenges warrants more substantial intervention.

For healthcare organizations, the timing creates an additional layer of uncertainty.

Teams responsible for out-of-network reimbursement must manage today's requirements while preparing for operational changes that could affect future dispute submissions, payment calculations, and administrative workflows.

Could Targeted Reforms Offer an Alternative?

The physician organizations opposing the legislation are not arguing that the existing IDR process is flawless.

Instead, they are advocating targeted improvements that preserve independent arbitration while addressing its operational weaknesses.

Several areas have emerged as priorities in discussions about possible reforms.

Strengthening Payment Enforcement

An arbitration decision has limited practical value if the resulting payment is not made within the applicable timeframe.

Improved enforcement could help ensure that successful disputes translate into actual reimbursement.

Reducing Ineligible Disputes

Claims that do not meet federal IDR eligibility requirements can create unnecessary administrative work.

Improving eligibility screening and documentation could help reduce avoidable submissions.

Increasing Transparency

Clearer information about payment determinations, qualifying payment amounts, and dispute requirements could help providers and insurers make more informed decisions.

Addressing Unusually Large Awards

Policymakers are also considering ways to address outlier payment determinations and potential misuse of arbitration without eliminating the independent process altogether.

These approaches would not resolve every disagreement surrounding federal IDR.

However, they illustrate that reforming the system and eliminating it are not the only two possible choices.

What Healthcare Providers Should Be Watching

Although the legislation remains a proposal, the debate highlights several practical priorities for organizations managing out-of-network claims.

1. Maintain Visibility Into Reimbursement Trends

Providers should understand where significant differences occur between initial insurer payments, expected reimbursement, and final dispute outcomes.

Tracking these patterns can help identify recurring issues and support better financial planning.

2. Strengthen Documentation Practices

Accurate claim information, payment notices, negotiation records, and dispute-related correspondence remain essential to effective reimbursement operations.

Well-organized documentation can also make it easier to adapt when procedural requirements change.

3. Distinguish Proposed Legislation From Implemented Regulations

A congressional proposal does not automatically change current IDR eligibility, submission requirements, or payment timelines.

Healthcare teams should continue following applicable federal requirements while monitoring official announcements.

4. Evaluate the Operational Implications of Upcoming Changes

As federal agencies implement revised procedures, revenue cycle teams may need to update internal workflows, staff training, or dispute management practices.

For example, a practice that handles a substantial volume of out-of-network claims may benefit from reviewing how its team tracks negotiation periods, submission deadlines, and supporting documentation.

5. Follow the Broader Policy Discussion

Changes to arbitration, payment benchmarks, or enforcement mechanisms could influence both immediate reimbursement operations and longer-term payer contracting strategies.

Understanding the direction of these developments can help organizations prepare rather than react.

The Bigger Question Is Whether Payment Reform Can Balance Efficiency and Fairness

The debate surrounding the Lower Premiums, Faster Payments Act reflects a broader challenge in American healthcare.

Patients need protection from unexpected medical bills. Insurers need predictable payment systems. Healthcare providers need workable mechanisms for resolving legitimate reimbursement disagreements.

Achieving all three objectives requires more than simply reducing the number of disputes.

It requires confidence that the payment process is transparent, consistent, efficient, and accountable.

The concerns raised by ASA, ACEP, and ACR suggest that independent arbitration remains an important safeguard from the physician community's perspective.

Supporters of the proposed legislation, meanwhile, argue that a more substantial overhaul is necessary to address costs and inefficiencies.

As Congress evaluates these competing approaches, healthcare providers should pay close attention to how potential reforms could affect their reimbursement rights, administrative responsibilities, and financial operations.

The question is no longer simply whether the federal IDR process needs improvement. It is whether meaningful reform can preserve fairness while making the system work better for everyone involved.