A congressional proposal to overhaul the payment dispute process under the No Surprises Act could reduce costs and administrative burden for self-funded employers. But physician groups are already opposing it, the legislation faces long odds in its current form, and benefits brokers should temper client expectations accordingly.
Energy and Commerce Committee Ranking Member Rep. Frank Pallone (D-NJ) introduced the Lower Premiums, Faster Payments Act in early October, which would replace the existing independent dispute resolution (IDR) process - effective for services furnished on or after January 1, 2028 - with a benchmark payment system tied to the median in-network rate, known as the qualifying payment amount (QPA).
The bill's prospects are closely tied to the outcome of the November 3 midterm elections. Pallone is poised to become chair of the House Energy and Commerce Committee if Democrats win control of the House, a position that would give him significantly more power to advance his legislation. If Republicans retain the House, the more likely path is the No Surprises Act Enforcement Act, introduced by Rep. Greg Murphy (R-NC) and Sen. Roger Marshall (R-KS), which focuses on increasing penalties for insurer violations rather than replacing the IDR process altogether.
Either way, analysts and both parties agree that some form of No Surprises Act reform will advance in the next Congress - the question is how sweeping it will be.
The current IDR system, which uses arbitration to settle out-of-network payment disputes, has generated approximately $22.4 billion in extra spending between 2022 and 2025, according to a Georgetown University Center on Health Insurance Reforms analysis. A key driver: approximately 67 percent of the 2.5 million disputes submitted in 2025 were filed by just 10 provider groups, according to Rep. Pallone's office.
Under the current IDR process, insurers and providers each propose a rate for a given out-of-network service, and an arbitrator chooses one after weighing the QPA and other relevant data.
Beginning in 2028, the Lower Premiums, Faster Payments Act would eliminate this "baseball-style" arbitration and replace it with a benchmarking system, paying providers at the median in-network contracted rate as of January 31, 2019, adjusted annually to the Consumer Price Index, with payments required within 30 days of a claim being filed.
Insurance Business Benefits US has received several comments from benefits industry and healthcare experts.
Clayton Eidson, founder and CEO of AZ Health Insurance Agents in Arizona, said self-funded employers in his practice are already telling him that "dispute volumes, arbitration awards, and administrative fees are climbing faster than anyone expected." He said the fundamental question is whether a benchmark-based system will accurately reflect what is happening in regional markets.
Nathan Weller, an insurance advisor at Insurpedia who focuses on healthcare affordability and accessibility, offered a measured view: "Benchmarking payments provides more stability, but often does not accurately reflect the costs associated with various specialties, locations, and complexities of medical services."
Alan Cohen is co-founder and chief product officer of health plan company Centivo, headquartered in Buffalo, New York. He said the proposal effectively replaces the entire IDR system, noting that the extra costs driven by the IDR process had "seemed to surprise everyone" and that the reform "will return us to a baseline, pre-IDR."
He added that under the proposal, non-contracted providers would be paid the median rate of contracted providers - something he acknowledged providers could reasonably object to, since they opted out of contracting but would now be forced to accept a contracted rate.
Cohen also flagged a longer-term risk. The proposal resets rates to 2019 levels with a consumer price index-based inflation factor, following an August 2026 Fifth Circuit ruling that found key elements of the existing QPA methodology invalid.
Over time, he said, this could create a divergence between statutory payment levels and actual market rates in areas where healthcare inflation outpaces the consumer price index - which he noted is the majority of healthcare markets.
Navin Nagiah, CEO of Daffodil Health in San Francisco, said implementation of the QPA benchmark would benefit both employers and payors by reducing payments, cutting unpredictability in high awards, and lowering administrative costs - including those associated with filing disputes, managing arbitration fees, and reconciling payments.
He also noted that the reform could ease upward pressure on contracted rates, since providers currently negotiate higher in-network rates in part because of the potentially lucrative IDR outcomes available to them as out-of-network providers.
Kirat Kharode, founder and CEO of healthtech firm HealCo in Jersey City, New Jersey - who previously spent nearly two decades in hospital system leadership - said replacing arbitration with a benchmark tied to median in-network rates "could make payments more predictable and reduce administrative expense."
But he cautioned that negotiated rates "reflect market power as well as the underlying economics of delivering care," and that a benchmark is not automatically fair simply because it is based on the median.
The bill has drawn swift pushback from organized medicine. The American Society of Anesthesiologists (ASA), the American College of Emergency Physicians (ACEP), and the American College of Radiology (ACR) issued a joint statement cautioning that eliminating the IDR process would remove a safeguard against unreasonably low insurer payments and give insurers more influence over out-of-network reimbursement.
“Giving health insurance companies even greater control over physician payments is not the solution to concerns about the IDR process – particularly when health insurers’ own practices are contributing to the problems Congress should be addressing,” said ASA President Patrick Giam, M.D. FASA.
The physician groups also characterized the legislation as premature, arguing that recent federal operational changes have not been fully implemented, and recommended instead improving the No Surprises Act through targeted policymaking that reduces bad actors.
Their position is backed by data. A September 2026 analysis submitted to Congress by the physician groups showed that insurers failed to participate and lost by default on 25 percent of IDR line items in 2025, offered $1 or less on 8 percent of line items, and, excluding defaults, submitted offers at or below the QPA for nearly 40 percent of items.
Kharode framed the network risk in practical terms: "Set the benchmark too low, and you risk creating the opposite problem, where certain providers become less willing to contract or maintain access to particular services."
Nagiah took a more optimistic view, saying the changes would reduce the incentive for providers to go out of network, helping payors keep more providers in-network at better rates.
George Huntley, CEO of the Diabetes Patient Advocacy Coalition and the Diabetes Leadership Council, said he could see the reform shrinking networks given the reduced out-of-network risk, but did not expect it to reduce access to care broadly. He said the changes "could contain healthcare costs in the future."
Despite the potential upside, experts were consistent that brokers should not promise immediate premium reductions.
Nagiah recommended that brokers communicate the proposed changes without overstating their impact and instead encourage employers to request No Surprises Act pricing analytics from their third-party administrator or payor partners, examine how the new payment models might affect provider payments, and ask for greater transparency on both current costs and potential savings.
Cohen was direct about the legislative outlook. "It is unlikely or impossible to pass in its current form," he said, pointing out that the bill has not advanced out of any of the three committees it was referred to, has no co-sponsors, and faces an uncertain path.
Legislation is not expected to move until the next Congress, with the House Ways and Means Committee taking a bipartisan approach and the Senate Health, Education, Labor, and Pensions (HELP) Committee holding private roundtables with providers, insurers, and IDR entities.
Kharode said benefits advisors should pay close attention to what happens after any law changes and that employers should not have to take anyone's word that a new reimbursement formula is delivering savings.
He recommended that employers require their third-party administrator to show exactly how many claims entered dispute resolution, what was initially and ultimately paid, how long the process took, and what it cost.
Weller said that plan sponsors should become more knowledgeable about this proposed legislative initiative, review their claims data, and engage their brokers and benefit administrators to understand the likely impact of the reforms.
"Payers need more than the assurance of cost controls,” he said. “Plan sponsors need the confidence that the payment reform policies will preserve adequate reimbursement for health care services and the ability to access health care services for employees."
