Federal Surprise-Billing Arbitration Drew 2.6 Million Disputes in 2025, Far Above Projections

Federal regulators projected 17,333 non-air-ambulance payment disputes a year when they built the No Surprises Act's arbitration system in 2021. The process works like a referee: when an out-of-network provider and a health plan disagree over payment, it keeps the patient out of the fight and picks one side's final offer.

Before the No Surprises Act took effect in 2022, patients could receive large unexpected bills after emergency care, air ambulance rides or treatment from an out-of-network clinician at an in-network hospital. The law bars those surprise bills in most cases and limits what patients owe to their usual in-network cost sharing. It shifted the remaining payment fight to providers and health plans, which can use federal arbitration if they can't agree on a price.

Providers and facilities initiated 2,516,173 of those non-air-ambulance disputes in 2025 alone, 145 times the projected rate, according to CMS Federal Independent Dispute Resolution (IDR) data through the fourth quarter of 2025. Including air ambulance cases, the federal system received 2,559,375 disputes for the year, and volume kept climbing through the back half: 1,372,563 disputes were initiated in the second half of 2025, 16% more than the 1,186,812 initiated in the first half.

The Departments of Health and Human Services, Labor and the Treasury estimated in the October 2021 interim final rules that the Federal IDR process would receive 17,333 non-air-ambulance disputes and 4,899 air ambulance disputes a year, for a combined 22,232 disputes annually.

MoneyGeek's analysis of full-year 2025 IDR data found 2,516,173 non-air-ambulance disputes were initiated, 145.2 times the government's projected rate for that category. Air ambulance disputes totaled 43,202 in 2025, 8.8 times the projection. Combined, the 2,559,375 disputes initiated in 2025 ran at 115.1 times the government's original estimate for the whole program.

Every half-year period in the CMS data, beginning in 2023, shows growth: 288,810 disputes in the first half of 2023, 390,346 in the second half, 610,498 in the first half of 2024, 853,374 in the second half, 1,186,812 in the first half of 2025 and 1,372,563 in the second half of 2025, per CMS Federal IDR Supplemental Tables.

Volume didn't stop at the end of 2025. CMS's bi-monthly operational updates, which run ahead of the formal PUF releases, show 1,433,289 more disputes initiated between January and May 2026 alone. The figures in this analysis reflect the most recent full PUF release, through the fourth quarter of 2025, not the program's current, still-climbing total.

The Federal IDR process lets an out-of-network provider or a health plan settle a payment dispute through binding arbitration after a mandatory 30-business-day negotiation period fails. A dispute reaches this stage only after the health plan has processed the underlying claim, the formal payment request. MoneyGeek's guide explains =.

Once a dispute reaches arbitration, each side submits a single best offer to a certified IDR entity, one of 15 organizations authorized to decide cases as of June 2025, when the Departments certified two more, Capitol Bridge and Livanta. The entity picks one offer as the final payment amount. It can't split the difference or choose a number in between. Arbitrators must weigh the qualifying payment amount (QPA), a benchmark tied to 2019 median in-network rates adjusted for inflation, though they can also consider other factors, such as a provider's training or a case's complexity.

Emergency department visits made up 52% of second-half 2025 payment determinations, the largest single category, followed by radiology services at 15%. The law's protections apply to emergency scenarios, not routine urgent care visits. The No Surprises Act also protects patients from balance billing for air ambulance transport and for care from an out-of-network provider at an in-network facility, such as an anesthesiologist or radiologist the patient didn't choose. MoneyGeek's breakdown of in-network vs. out-of-network coverage explains how the law's emergency-care cost-sharing cap works.

Providers, facilities and air ambulance companies won approximately 85% of Federal IDR payment determinations in the second half of 2025, down slightly from 88% in the first half of the year, according to CMS. Health plans and issuers won about 14% of determinations, with the remainder split decisions.

The prevailing offer beat the health plan's qualifying payment amount in about 87% of determinations made in the second half of 2025, per CMS's supplemental background report. MoneyGeek's review of the underlying IDR Public Use Files found the median prevailing offer nationally, across 3,480,851 disputes with a closed payment determination between 2023 and 2025, ran at 390% of the QPA, or almost four times the benchmark health plans use to set their initial payment.

Default decisions, in which one side failed to submit an offer or pay required fees, made up 17% of second-half 2025 determinations, down from 22% in the first half. Providers won 90% of those defaults.

Ten initiating parties accounted for 66% of all disputes initiated in the second half of 2025, and three companies alone, HaloMD, Team Health and SCP Health, initiated 38% of them, according to CMS. These aren't three doctors filing disputes personally.

Team Health and SCP Health staff emergency rooms and other hospital departments with thousands of physicians nationwide, while companies such as HaloMD manage medical billing and dispute filing for physician groups and hospitals as a service. When one of those doctors has an underpaid out-of-network claim, the company managing that doctor's billing files the dispute, which is why a handful of company names can represent such a large share of the total volume.

Health care facilities initiated 24% of second-half 2025 disputes, up from 19% in the first half, while individual providers and their representatives initiated the rest. The concentration means a small number of billing operations, not a broad swath of the medical profession, generated most of the volume beyond the government's 2021 projection.

Texas generated more Federal IDR payment determinations per capita than any other state between 2023 and 2025, at 4,044 per 100,000 residents, according to MoneyGeek's analysis of CMS IDR Public Use Files. Arizona ranked second at 3,274 per 100,000, followed by Tennessee at 2,043, New Jersey at 1,805 and Nevada at 1,798.

These state figures count payment determinations closed in the Federal IDR PUF, a different measure from the disputes-initiated figures used for the national half-year trend above. A dispute can sit open for months before it's assigned an outcome, so this ranking reflects determinations resolved between the first quarter of 2023 and the fourth quarter of 2025, not a single point-in-time snapshot of every dispute ever initiated.

Texas accounted for 1,282,446 payment determinations over the three-year period, more than a third of the national total, and providers won 85.52% of them. The median prevailing offer in Texas disputes reached 482% of the QPA, higher than the national median of 390%. Win rates in this ranking count a split decision as half a win for each side, MoneyGeek's own calculation choice, not a metric CMS publishes.

Vermont sat at the opposite end, with 4.7 payment determinations per 100,000 residents. Minnesota (27.6), North Dakota (31.5), Nebraska (63.3) and Hawaii (65.2) rounded out the five lowest per-capita rates.

Vermont's and Minnesota's low rates aren't a sign of a data problem or a state-law exemption. CMS's applicability chart confirms both states use the standard Federal IDR process, though this analysis doesn't test what explains those low rates.

Federal IDR payment disputes and health insurance claim denials are different problems for different parties. A claim denial happens when a health plan refuses to pay a claim at all. The patient is then responsible for the bill unless they win an appeal, the subject of MoneyGeek's analysis of ACA claim denial rates by state and insurer. An IDR payment dispute happens after the health plan has already agreed to pay something. It's an argument between the provider and the health plan over how much, with the patient held harmless by law.

Federal IDR determinations that favor providers can raise what health plans pay for out-of-network care, and those payments feed into insurers' medical claims costs. Those costs are one input into future pricing, though this analysis doesn't estimate how much any single arbitration award moves a specific premium. Nationwide ACA marketplace premiums rose 20% for 2026, according to MoneyGeek's 50-state analysis of 2026 ACA premiums, a separate trend with many causes beyond IDR alone.

Patients aren't a party to Federal IDR disputes and can't be billed the difference between the arbitration award and their health plan's payment for a protected service, regardless of who wins. If a bill shows up anyway, patients can dispute it directly with the provider's billing office and file a complaint with the No Surprises Help Desk at 1-800-985-3059.

If a health plan denies a claim outright instead of paying a reduced amount, the fix is different: file an internal appeal within the plan's deadline, often 180 days, and escalate to an independent external review if the appeal fails. MoneyGeek's step-by-step guide to appealing a health insurance claim denial covers the process in detail.

Cost-sharing rules, including the deductible and the out-of-pocket maximum, determine how much of a bill a patient owes even in a worst-case scenario.

MoneyGeek analyzed all payment determinations in the CMS Federal IDR Public Use Files, from 2023 through the most recent release. We compared dispute volume to the Departments' published first-year projection and computed state-level rates per 100,000 residents using Census Bureau population estimates.