Quick Summary
- Representative Frank Pallone Jr. has introduced the Lower Premiums, Faster Payments Act to overhaul the No Surprises Act's federal dispute resolution process.
- The legislation would eliminate Independent Dispute Resolution (IDR) arbitration for services furnished beginning January 1, 2028.
- Out-of-network reimbursement would instead be determined using a revised Qualifying Payment Amount (QPA) based on median in-network rates.
- The proposal would require insurers to issue payments within 30 days and introduce additional oversight of payment calculations.
- Healthcare provider organizations have raised concerns that eliminating IDR could reduce providers' ability to challenge inadequate reimbursement.
New Legislation Targets Federal IDR Process
A new bill introduced in the U.S. House of Representatives could significantly change how healthcare providers and insurers resolve out-of-network payment disputes under the No Surprises Act.
On October 8, 2026, Representative Frank Pallone Jr. (D-N.J.) introduced the Lower Premiums, Faster Payments Act, legislation intended to address concerns about the cost, efficiency, and administration of the federal Independent Dispute Resolution process.
Pallone, who helped develop the original No Surprises Act, argues that the arbitration system has become increasingly expensive and inefficient, contributing to higher healthcare costs and insurance premiums.
The proposal would replace the existing arbitration process with a standardized reimbursement methodology tied to median in-network payment rates.
Proposed Changes to Out-of-Network Reimbursement
Under current federal law, eligible healthcare providers and insurers can enter an open negotiation period and subsequently pursue IDR arbitration when they cannot agree on an appropriate out-of-network payment.
The proposed legislation would eliminate that arbitration option for services furnished on or after January 1, 2028.
Instead, reimbursement would be based on a revised Qualifying Payment Amount, generally calculated using an insurer's median contracted rates for comparable services.
The legislation would also require insurers to issue applicable payments within 30 days of receiving a claim.
Additional provisions would establish updated QPA calculation requirements and annual audits intended to improve transparency and accountability.
Patient protections against surprise medical bills would remain in place.
Lawmakers Cite Growing Arbitration Costs
Supporters of the legislation point to increasing dispute volumes and arbitration expenses as reasons for reform.
According to figures cited by the House Energy and Commerce Committee, approximately 2.5 million disputes were submitted through the federal IDR process in 2025.
The committee reported that roughly 67% of those disputes originated from just ten provider groups.
It also stated that the 15 arbitration entities operating during 2025 received approximately $1.3 billion in fees.
Supporters argue that replacing arbitration with a standardized payment benchmark could reduce administrative expenses, accelerate payments, and limit healthcare cost increases.
However, these arguments remain contested among healthcare industry stakeholders.
Healthcare Providers Raise Reimbursement Concerns
Provider organizations have expressed concerns that eliminating independent arbitration could give insurers greater influence over out-of-network reimbursement.
The IDR process currently provides eligible providers with an opportunity to challenge payment offers they believe do not adequately reflect the value of services rendered.
Replacing arbitration with a mandatory benchmark could limit those opportunities, particularly when providers dispute the accuracy or appropriateness of an insurer's QPA calculation.
The proposal also arrives amid ongoing legal challenges involving QPA methodology and the role of payment benchmarks in federal arbitration.
What This Means for Healthcare Providers
The Lower Premiums, Faster Payments Act remains proposed legislation and has not changed existing IDR requirements.
Healthcare providers should continue following current negotiation and arbitration procedures while monitoring potential legislative developments.
If enacted, the proposal could substantially alter reimbursement strategies, dispute resolution options, and revenue cycle operations for out-of-network services.
Understanding these potential changes will be important for practices seeking to protect reimbursement and maintain financial stability.
How Patriot Group Can Help
Patriot Group assists healthcare providers with Independent Dispute Resolution, payer disputes, denied and underpaid claims, and revenue recovery.
Through its combination of healthcare legal expertise and revenue cycle management services, Patriot Group helps providers navigate existing IDR requirements, evaluate reimbursement disputes, and prepare for changes in the regulatory environment.
For questions about the No Surprises Act, IDR, or out-of-network reimbursement, contact Thomas J. Force, Esq., President and Founder of Patriot Group, at TForce@patriotcompli.com or call (631) 870-4040.
