National NSA Report on Aggressive Provider Billing

By: David Ostrowsky

Though the No Surprises Act (NSA) was designed to safeguard patients against receiving unexpected medical bills, it has become apparent that certain trends within the corresponding Independent Dispute Resolution (IDR) process may be contributing to increased costs for employer-sponsored plans. The Phia Group has analyzed data that sheds light on these patterns.

Phia’s recently released “National NSA Report on Aggressive Provider Billing,” grounded in a study of systemic billing patterns and arbitration strategies spanning over 1.25 million federal arbitration disputes and data from more than 23,000 healthcare providers in publicly available CMS sources, indicates that some providers may be positioning themselves for more favorable IDR outcomes by utilizing elevated offer strategies that can influence arbitration decisions and result in awards above typical payment levels. In other words, the data suggests that arbitration may, in certain instances, be functioning not only as a dispute resolution mechanism but also as a pathway to higher out-of-network reimbursements from employer-sponsored plans. While no state appears entirely unaffected, states such as Nevada, South Carolina, Arkansas, Louisiana, and Colorado show comparatively higher concentrations of these billing and arbitration patterns. Conversely, states such as Michigan, Pennsylvania, Indiana, Illinois, and Wisconsin have experienced comparatively lower rates of such activity. Meanwhile, Tennessee appears to be a state in which a relatively small number of providers account for a disproportionately high volume of IDR filings. Similar patterns may also be present in South Carolina and Virginia. This suggests that, within certain states, activity may be concentrated among particular providers rather than representing a uniform statewide trend.

California has also become part of this broader discussion. Earlier this year, Anthem Blue Cross filed suit against eleven hospitals in the state, alleging misuse of the NSA arbitration process to obtain higher out-of-network payments. The complaint, filed in January, asserts that the hospitals submitted thousands of emergency service claims to arbitration that included inaccurate or inflated charges. The litigation is ongoing, and its outcome may help clarify the standards and expectations surrounding appropriate use of the arbitration process.

While the NSA continues to provide meaningful financial protection to patients, employer-sponsored plans may face increased costs and budget uncertainty associated with IDR activity. Over time, these costs can translate into higher employee premium contributions, increased deductibles, and higher cost-sharing obligations. As a result, careful cost containment strategies and increased transparency regarding IDR practices, including reviewing claims patterns, monitoring arbitration filings, and identifying unusually high volumes of activity, remain important considerations for self-insured health plan fiduciaries, as well as the brokers and advisors who support them within a complex regulatory environment.

Check out the full National NSA Report on Aggressive Provider Billing: https://www.phiagroup.com/media/posts/national-nsa-report/