Federal judge strikes down No Surprises Act IDR fee increase, batching restrictions; CMS suspends IDR process in response

The federal government must vacate nationwide its federal fee increase and batching rule for the No Surprises Act’s independent dispute resolution process for certain out-of-network providers and group health plans because they violate the Administrative Procedures Act’s notice-and-comment requirement, a federal judge in Texas ruled Aug. 3, siding with the Texas Medical Association and other health care providers challenging the seven-fold fee increase and restrictions on batching related claims in a single payment dispute. 

In response to the ruling, the Centers for Medicare & Medicaid Services has temporarily suspended the IDR process, including the ability to initiate new disputes. 

In a separate case in February, the same Texas judge vacated nationwide the federal government’s revised independent dispute resolution process for determining payment for out-of-network services under the No Surprises Act, ruling it skewed the arbitration results in commercial insurers’ favor in violation of the compromise Congress reached in the Act. The AHA and American Medical Association filed a friend-of-the-court brief in support of the TMA in that case, which is currently on appeal to the 5th Circuit.