Spine and orthopedic practices that use the federal Independent Dispute Resolution process to challenge out-of-network underpayments are about to see a significant fee reduction.
HHS, CMS, the Department of Labor and the Department of the Treasury finalized a rule May 28 overhauling the federal IDR process under the No Surprises Act.
Here are six things to know:
- The administrative fee per party per dispute will drop from $115 to $15, a reduction of more than 85%: The change directly affects the economics of disputing smaller claims, an issue that has frustrated specialty practices since the IDR process launched in April 2022. For surgical specialties like spine and orthopedics, where individual claims can run up to five to six figures, the lower fee makes it cost-effective to challenge a wider range of underpayments, not just the largest cases.
- Since launch, the IDR system has received more than 5 million disputes, far exceeding federal expectations and creating significant backlogs: “This rule cuts through bureaucratic delays, strengthens transparency between payers and providers, while continuing to protect patients from unnecessary financial stress,” HHS Secretary Robert F. Kennedy Jr. said in a statement. CMS Administrator Mehmet Oz, MD, said the rule is “about making government processes efficient, accountable and focused on results.”
Industry stakeholders also welcomed the changes. James Bobeck, CEO of Federal Hearings & Appeals Services, a certified IDR entity and national leader in medical review and dispute resolution, said the updated rules “will deliver a better, smarter and more efficient IDR process.” He pointed to enhanced regulations governing open negotiations, batching, and information exchange between parties as changes that “will clarify the process and reduce the number of ineligible filings that enter the process today.”
- The IDR process has become a critical tool for spine and orthopedic practices recovering fair payment on out-of-network cases: Spine and orthopedic groups have increasingly turned to IDR as a leverage point against payer underpayments, a trend that has grown alongside the broader migration of cases to ASCs.
Daniel Choi, MD, of Ronkonkoma, N.Y.-based Spine Medicine & Surgery of Long Island, previously told Becker’s the IDR process has been a “game changer” for his practice, allowing him to challenge insurer underpayments. He said, for example, that an anterior cervical discectomy and fusion should be reimbursed at $15,000 rather than $1,000.
- The rule expands batching flexibility, allowing more claims to be resolved together in a single dispute while placing reasonable limits on the number of claims per batch: The change responds to a major pain point for high-volume specialty practices. Fort Worth, Texas-based Radiology Associates of North Texas recently projected more than $51 million in avoidable administrative costs tied to current batching rules and unpaid IDR awards.
The group said federal interpretations were forcing providers to split similar claims into thousands of smaller arbitration filings with separate fees. The batching question is particularly relevant for spine and orthopedic groups, whose surgical episodes often generate multiple related claims per patient, surgeon, assistant, implants, imaging and follow-up care that under current rules can be difficult to consolidate into a single dispute.
- Payers will be required to use standardized claim codes when communicating about out-of-network services, helping providers determine earlier whether a claim qualifies for IDR: A new centralized IDR gateway platform will also launch in phases beginning in 2026, allowing users to start disputes, track status and manage activity in one place. The gateway will eventually require payers to register, making it easier for providers to identify the correct party and reduce errors.
- Enforcement gaps remain a concern: A recent 5th Circuit Court of Appeals ruling found providers do not have a private right of action under the No Surprises Act to enforce unpaid IDR awards, meaning a favorable arbitration decision does not always translate to payment. The new rule does not address that gap.
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