The No Surprises Act (NSA), part of the Consolidated Appropriations Act, 2021 (P.L. 116-260), established various consumer protections related to surprise billing—that is, circumstances in which individuals receive large, unexpected medical bills when they are unknowingly, and potentially unavoidably, treated by out-of-network (OON) providers. The law generally recognizes surprise billing circumstances to include OON emergency services, OON nonemergency services provided during a visit at an in-network facility, and OON air ambulance services. In those situations, the NSA generally limits the amount consumers pay for care and specifies a methodology to be used to determine how much insurers must pay OON providers for care if the parties cannot agree on the payment amount. Under this methodology, either the insurer or the provider may initiate an independent dispute resolution (IDR) process before a private arbitrator (i.e., an IDR entity). The IDR entity selects between the parties’ payment offers after considering a list of statutory factors, including the qualifying payment amount (QPA) for an item or service, defined generally as an insurer’s 2019 median in-network rate for the item or service, indexed for inflation. The year 2024 marks the first year in which the IDR process was operational throughout the year without suspension, since it first began accepting dispute submissions in April 2022. This report, building on a prior CRS report analyzing 2023 data on IDR operations, reviews and analyzes data made publicly available by the Departments of Health and Human Services, Labor, and the Treasury—pursuant to NSA requirements—regarding IDR operations in calendar year 2024. In general, the data show an IDR process that was still maturing in 2024, as the year saw significant increases in the use of the IDR process (relative to 2022 and 2023) by providers; a large increase in the number of determinations made relative to 2023 and improvements in the amount of OON emergency/nonemergency service dispute determinations made within the generally required 33 business days (though a majority of determinations were still made outside of that window); and continued notable increases in payment determination amounts in certain medical specialties. In 2024, more than 1.46 million federal IDR disputes were initiated, which was more than double the amount initiated in 2023 (679,156). Of this total, nearly 1.42 million disputes (approximately 97%) involved OON emergency/nonemergency services; the remaining 44,238 disputes (approximately 3%) involved OON air ambulance services. Disputes initiated in 2024 were slightly more concentrated in the second half of the year (approximately 58%), which may be attributable, in part, to delays in parties initiating disputes due to the Change Healthcare cybersecurity incident in February 2024. Providers initiated nearly all of the disputes in 2024 (over 99%). Providers with evidence of private equity affiliation continued to be heavy utilizers of the IDR process; several of those providers are among the top 10 initiating parties and initiated around 45%-55% of the disputes involving OON emergency/nonemergency services in each quarter and 65%-72% of the disputes involving OON air ambulance services in each quarter. However, the percentage of disputes involving OON emergency/nonemergency services initiated by those providers appeared to decrease relative to 2023, when providers among the top 10 initiating parties initiated at least two-thirds (67%) of such disputes each quarter. Meanwhile, 2024 saw a steady increase of disputes involving OON emergency/nonemergency services initiated by third-party representatives of providers who were among the top 10 initiating parties (from 13% in Q1 to 22% in Q4 of 2024). Providers continued to demonstrate success with the IDR process in 2024 and improved on their success rate relative to 2023. This improvement was largely attributable to an increased number of determinations in which the insurer defaulted by not submitting an offer or paying applicable fees. In 2024, providers prevailed in a great majority of the payment determinations (approximately 85% in 2024; approximately 80% in 2023), and a similar majority of selected offers (approximately 85% in 2024; approximately 80% in 2023) were for an amount greater than the QPA. Insurers’ offers were at or below the QPA in roughly half of disputes in 2024 (approximately 47%). Two specialties—(1) surgery and (2) neurology and neuromuscular procedures—saw significant increases in the median prevailing offer relative to the QPA from Q1 to Q4 of 2024, which continued (at a slightly slower pace) a trend that started in 2023. The median prevailing offer for disputes involving surgery increased from around 3 times the QPA in Q1 2023 to over 9 times the QPA in Q1 2024 to around 13 times the QPA in Q4 2024; for disputes involving neurology and neuromuscular procedures, the median prevailing offer increased from over 3 times the QPA in Q1 2023 to around 12 times the QPA in Q1 2024 to nearly 17 times the QPA in Q4 2024.
Full content not yet available.