The No Surprises Act (NSA) was enacted to protect patients from unexpected medical bills while establishing a standardized, federally regulated process for resolving out-of-network payment disputes between payers and providers. At the heart of the NSA is the Independent Dispute Resolution (IDR) process—an arbitration framework designed to fairly settle qualifying disputes.
Yet eligibility remains one of the most persistent challenges in the IDR system.
Industry data consistently shows that a significant share of disputes submitted to IDR do not meet federal eligibility requirements. An AHIP and BCBS Association survey found that nearly 40% of initiated NSA IDR disputes were ineligible under the law, while only 15% were ultimately dismissed — resulting in nearly 200,000 ineligible claims being paid by health plans.
Public data from the Centers for Medicare & Medicaid Services (CMS) reinforces this trend.
Zelis analysis of 2024 CMS Public Use File (PUF) data shows that of the 1,463,873 IDR casesinitiatedin 2024, 644,326 (44%) were challenged as ineligible by the non-initiating party, and 262,411 were found ineligible and closed. The pattern continuedin to 2025, with non-initiating parties challenging eligibility for 40% of disputes in the first six months of the year. CMS has also identified dispute eligibility complexity as the leading cause of IDR entity (IDRE) processing delays.
Together, these figures point to a systemic issue:determining whether a dispute qualifies for federal IDR remains difficult, time-consuming and costly — even before arbitration begins.
TL;DR
Key Takeaways for Payers Navigating the IDR Landscape
- Eligibility is the biggest IDR bottleneck. Nearly 40% of disputes are challenged as ineligible, and eligibility complexity is the leading cause of IDR delays.
- Early eligibility review saves millions. Preventing ineligible disputes from reaching arbitration avoids unnecessary administrative and IDR entity fees.
- Merit-based wins matter. They reflect defensible pricing and real vendor expertise— not process errors or technicalities.
- Bottom line: The strongest NSA strategies don’t just win disputes — they prevent unnecessary ones by challenging ineligible claims early and successfully defending pricing.
Why IDR Eligibility Is So Often Contested
Ongoing commentary around NSA interpretation has contributed to inconsistent dispute submissions. In a recent Becker’s Hospital Review article summarizing a podcast interview with HaloMD’s chief external affairs officer, Patrick Velliky noted that providers and payers may apply different definitions when assessing eligibility — particularly around clinical stabilization and care classification.
At the same time, litigation has brought increased scrutiny to IDR practices. Health Care Service Corp’s Blue Cross and Blue Shield (BCBS) of Texas has alleged that Zotec Partners knowingly submitted thousands of ineligible disputes, citing failuresto adhere to state law, IDR timelines and eligibility requirements. IN a separate case, Anthem Blue Cross filed a lawsuit against 11 Prime Healthcare hospitals alleging systematic submission of ineligible claims. Defendants in both cases have denied the allegations in statements shared with Becker’s Payer Issues.
While outcomes remain unresolved, these cases underscore a growing concern across the industry: ineligible disputes strain the IDR system, increase administrative costs and delay resolution for qualifying cases.
Common Reasons IDR Disputes are Deemed Ineligible
Many eligibility challenges stem from recurring, avoidable issues, including:
- State law applicability:When a state surprise billing law governs a claim, it may supersede federal NSA provisions, making the dispute ineligible for federal IDR.
- Incomplete or failed open negotiation: Providers must complete a 30-business-day open negotiation period before initiating IDR. Skipping steps or failing to meet requirements renders the dispute ineligible.
- Submission errors: Missed timelines, improper batching or incomplete documentation can disqualify a dispute.
- Non-NSA claims: In-network services, non-emergency care and services outside NSA scope are frequently submitted in error and should be filtered out before arbitration.
Why Ineligible Disputes Matter
Behind every ineligible dispute is a broader operational impact. Delayed reimbursements can tighten cash flow. Administrative teams spend time responding to disputes that never should have entered arbitration. Members may experience billing confusion or extended resolution timelines.
In January 2026, federal policy makers formally acknowledged that eligibility-related challenges increase the overall cost of administering the IDR program and undermine its efficiency. They raised concerns that administrative fees paid regardless of eligibility determination ultimately inflate system-wide costs — costs that may be passed on to consumers over time.
The longer these errors persist, the more they distort performance metrics and erode confidence that the system is working as designed. Proactive eligibility monitoring isn’t just a compliance measure; it’s a safeguard for operational integrity. Payers who can surface ineligible disputes before they enter arbitration not only reduce administrative fees but boost operational credibility.
Proactively identifying ineligible disputes is more than a compliance safeguard. It protects operational integrity, preserves resources and helps ensure the IDR process functions as intended.
The Financial Impact of Stopping Ineligible Disputes Early
The value of early eligibility review is measurable.The CMS IDR administrative fee is $115 per party, per dispute. For the more than 262,000 disputes deemed ineligible in 2024, payers avoided over $30 million in administrative fees alone.
This figure does not include IDR entity arbitration fees, which range from $200 to $1,173 depending on dispute type and entity. A Health Affairs study examining IDR costs from 2022 to 2024 estimated more than $228 million in administrative fees and $656 million in IDR entity fees during that period.
When payers partner with an NSA vendor that proactivelyidentifiesand objects to ineligible disputes during open negotiation and IDR initiation— such as Zelis — avoid unnecessary fees and minimize operational burden.
Understanding IDR Wins: Eligibility, Technical and Merit-Based
Not all IDR wins reflect the same reason for success. Payers evaluating vendor performance should understand the differences:
- Eligibility wins: Occur when a dispute is dismissed because it does not qualify for IDR. These wins avoid administrative fees but do not reflect defensible pricing or negotiation strength.
- Technical or default wins: Result from procedural errors or incomplete submissions. While valuable, they are driven by process issues rather than defensibility strength.
- Merit-based wins: Determined by the strength of the arguments, documentation and pricing rationale presented. These wins demonstrate defensible, market-based pricing and deep expertise.
The most successful payers consistently object to ineligible disputes, meet technical requirements for eligible cases and defend their positions with persuasive, well-supported IDR submissions.
Looking Ahead: Building a More Effective IDR Strategy
Stakeholders across policy, Congress, CMS, and the courts agree: the IDR process needs improvement.
Policy updates, regulatory guidance and market pressures will shape how eligibility and dispute resolution are handled in the years ahead.
Payers should stay informed, invest in technology and training, and partner with vendors who prioritize transparency and advocacy.
The goal is not simply to win disputes — but tominimize them with proactive eligibility review and provider-accepted, defensible pricing strategies that limit post-pay adjustments.
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About Zelis
Zelis offers a comprehensive suite of out-of-network solutions that optimize costs and manage risks associated with out-of-network claims. These solutions include AI-powered tools for dynamic claim optimization, expert negotiations for high-quality savings and network pricing leveraging extensive provider networks.
Additionally, Zelis supports compliance with the No Surprises Act through tools for pricing, negotiations and transparency, ensuring adherence to federal surprise billing regulations. Learn more here.
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