IDR abuse is accelerating. That’s the takeaway from a new analysis by the Niskanen Center, which dug into CMS’s latest data on the No Surprises Act’s arbitration process, covering the second half of 2025. Disputes are up nearly 75% year-over-year, providers are still winning the vast majority of cases, and program costs are closing in on $3 billion a year.
Their full analysis lines up with what CMS itself recently told The Wall Street Journal: “the system is being gamed to get higher prices.”
Highlights from the Niskanen Center’s analysis are included below (emphasis added). To read the full piece, click here.
The volume of disputes is exploding, blowing past every original projection.
- “The 2025 data reveal an almost 75 percent increase in the number of disputes initiated from the year before, with more than 2.5 million disputes initiated and nearly 2.2 million payment determinations decided. This is in stark contrast to the federal government’s original estimate that the IDR program would receive about 17,000 cases a year.”
- “Arbitrators have consistently ruled in favor of providers. Encouraged by their success, providers have steadily driven up the median winning offer to where it is now four times the QPAs that Congress established.”
Certain specialties are driving eye-popping awards far beyond QPAs.
- “Our analysis of the data shows that specialties such as neurology and surgery are typically pulling in awards 15 to 25 times the statutory in-network benchmarks.”
- “The median prevailing offer for neurology and neuromuscular procedures has increased sharply over time, reaching nearly 30 times the QPA in the second quarter of 2025. Surgery offers have also increased over time, ending 2025 with a median prevailing offer reaching roughly 15 times the QPA.”
- “The new data emerge against the backdrop of several media accounts of eye-popping awards to providers for routine services and procedures. One plastic surgeon practicing in New York and Florida, for example, reportedly earned $440,000 for a breast reduction surgery decided through arbitration, a procedure advertised as costing between $15,000 and $25,000 on average.”
- “According to data from Turquoise Health, a healthcare transparency platform, out-of-network providers are earning $34,000 for a common spine surgery — 24 times the median price of $1,400.”
- “In some cases, out-of-network surgical assistants, who typically help surgeons with such tasks as stitching up patients post-surgery and handling equipment, are earning orders of magnitude more than in-network surgeons for common procedures. For example, an in-network surgeon in Texas was paid $1,843 for a prostate-removal surgery for which an out-of-network assistant was paid $50,456, more than 27 times higher.”
Administrative and legal costs are snowballing alongside the awards.
- “By the end of 2025, total costs imposed by the IDR program now surpass $2.8 billion. If these trends continue, the total costs of IDR, combined with large award amounts, could eclipse the savings that the Congressional Budget Office projected the program would save. The majority of these costs are driven by payments to the arbitrators, followed by administrative fees and federal expenditures.”
- “In 2025, Independent Dispute Resolution Entities (IDREs), the arbitrators, received over $1.2 billion in compensation from the system. In addition to arbitrators themselves, a cottage industry of companies who help manage and file disputes has developed, with one such company, Texas-based HaloMD, bringing in over $1 billion a year on their own.”
- “Our analysis shows that in 2025, HaloMD filed more disputes than any other group in the country (19%), followed by private equity-backed provider groups including Team Health (12%), SCP Health (10%), and Radiology Partners (7%). Together, these four companies accounted for nearly half of all disputes initiated in 2025, suggesting that these businesses have successfully discovered how to flood the system and win consistently.”
The bottom line: the No Surprises Act is now functioning as what Niskanen calls a “price-inflation machine.” As the report concludes: “Without reform, patients will continue to bear these costs — not through the surprise bills the law was designed to eliminate, but through the higher premiums and slower wage growth.”
For more information on the cost of IDR abuses, click here.
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