HaloMD, a third-party independent dispute resolution services provider, has emerged as the top “middleman” under the No Surprises Act. Its share of initiating disputes jumped from just 1% in 2023 to 18% by the fourth quarter of 2024, an analysis of new CMS data found.

The No Surprises Act, passed in 2021, banned the practice of billing patients for the difference between what their insurer pays and what a provider charges when patients unknowingly receive care from an out-of-network provider. The law also established a federal IDR process that out-of-network providers and insurers can use to determine the OON rate that providers should receive if the two parties fail in their own attempts to negotiate. 

In 2024, a total of 1,419,634 surprise billing disputes were initiated through the federal IDR process, a 116% increase from 2023. More than 86% of those cases were filed by provider groups, according to an analysis of CMS data on emergency and non-emergency services (excluding air ambulance services). Among resolved disputes, provider groups won the majority, with their win rate rising from 68% in the first quarter of 2023 to 86% in the fourth quarter of 2024.

During IDR, providers submit unresolved bills to an HHS-approved arbitrator, who then selects an amount submitted by either the payer or the provider using criteria laid out by HHS. The arbitrators are obliged to consider the qualifying payment amount (QPA) — based largely on median regional in-network rates for a service in a given area — in their decisions. 

The majority of surprise billing disputes were initiated by a small number of providers or their representatives, an analysis of CMS data shows. The top initiating parties over the past two years — Team Health, Radiology Partners and SCP Health — represent thousands of clinicians across multiple states and are all backed by private equity. 

Although HaloMD ranked fourth overall in volume, it became the top initiating party in the fourth quarter of 2024. The third-party IDR services provider, with a win rate of more than 85% in 2024, is now facing lawsuits alleging abuse of the system. In May, Elevance, Inc.’s Georgia subsidiary sued the company and three Georgia providers, accusing them of falsely attesting to claim eligibility, overwhelming the IDR process and inflating payment offers. A month later, Elevance’s Ohio subsidiary, Community Insurance Company, made similar allegations against HaloMD and five providers in Ohio. 

Neurology, surgery and radiology providers using the IDR system won at especially higher prevailing rates. In 2024, the median payment determination among disputes involving neurology and neuromuscular procedures was more than 11 times the QPA. For surgeries, the median prevailing offer reached nearly 870% of the QPA.

But why did providers win surprise billing disputes so often? A KFF analysis suggested that providers’ high win rate in IDR cases may stem from how decision-makers weigh insurer-submitted QPAs against providers’ evidence like prior contracted rates, especially since private equity-backed groups often had higher past rates and filed many disputes. The analysis also noted that the high win rate incentivizes well-resourced specialty providers to remain out-of-network, since they can absorb the costs and delays of the IDR process and recover expenses by setting higher prices.