“Arbitration Outcomes for Out-of-Network Medical Bills Under the No Surprises Act”

The No Surprises Act (NSA), implemented in 2022, has protected patients nationally from surprise medical bills in most settings. However, out-of-network care resulting in arbitration between insurers and providers under the NSA may result in very high costs for this care. The objective of this paper is to characterize payments for out-of-network care resulting from disputes that underwent arbitration under the NSA and compare the settlement amounts to in-network prices. Using 2023 dispute and claims data from Elevance Health (EH), we described insurer and provider bids, and compared the final settlement amounts to the qualifying payment amount (QPA) - which is used in arbitration and is intended to represent average in-network market rates - and to in-network prices for similar procedures. Lastly, we compared settlement amounts to Medicare rates. 7076 disputes between EH and providers with arbitration under the NSA were analyzed, eighty percent of which were won by providers. Median (mean) final arbitration amounts were 3.72 (4.99) times the QPA, 2.04 (3.23) times actual median local in-network commercial rates, and 4.5 (5.8) times Medicare rates for the same services. This analysis shows that settlement amounts were substantially higher than QPA and median in-network prices, indicating that out-of-network providers are receiving substantially higher payments than in-network providers when they go through arbitration under the NSA. This contrasts with the Congressional Budget Office's prediction of savings through arbitration settlements close to average in-network prices.