No Surprises Act under attack by payers: 8 things to know
Health insurers and industry groups are criticizing the No Surprises Act independent dispute resolution (IDR) process, saying disputes and payouts are rising and some providers are exploiting arbitration. Cigna CEO Brian Evanko cited “abuses” and said payouts were manageable. A Wall Street Journal analysis of CMS data shows 2025 payouts near $15B vs $4.08B in 2024. Courts have largely rejected insurers’ challenges.
How this was made
The 30-second read
Why it matters
The article frames a potential escalation cycle: higher dispute volumes and awards increase insurer cost trend concerns, while providers and some courts dispute claims of insurer or provider gaming. Any further regulatory or legislative changes could shift arbitration economics and contracting behavior.
Market read
For traders, the most actionable element is UNH’s quantified claim that IDR adds 50 bps to 2026 cost trend and at least 100 bps to total commercial cost, which can influence insurer estimate revisions and positioning around healthcare cost inflation risk.
What to watch
Court rulings limiting judicial review and the centralized disputes portal fee cuts could change incentives for both insurers and providers, making outcomes highly dependent on how any further reforms are implemented.
Background
The No Surprises Act’s independent dispute resolution (IDR) process is under renewed payer criticism as arbitration payouts and dispute volumes rise, alongside litigation and proposed fixes.
Ticker impact
Cigna CEO Brian Evanko says the IDR arbitration system is being abused, citing unsustainable dispute volume concentrated among a small provider set.
Limited near-term impact, but could weigh on managed-care sentiment if IDR reform or provider behavior changes raise medical cost uncertainty.
The article is primarily a policy and process critique with no new Cigna-specific financial guidance, but it includes quantified dispute and cost-trend claims attributed to Cigna’s CEO.
Elevance Health adopted a policy across more than a dozen states penalizing hospitals 10% for using out-of-network providers, citing IDR abuse.
Low immediate price impact, but could support a view that ELV is taking steps to contain arbitration-related cost leakage.
The article describes a policy action and a prior case-volume increase, but does not provide new ELV financial metrics or a fresh regulatory decision.
Market effects
Managed-care insurers face potential cost and administrative volatility tied to No Surprises Act arbitration volumes and provider behavior; reform efforts could reprice risk across the sector.
US-focused impact, with state-level contracting and out-of-network enforcement actions (e.g., Elevance’s multi-state policy) potentially affecting regional provider networks.
Low, as the story is US healthcare regulation and insurer-specific cost mechanics.
Counterpoint
Providers argue the large awards reflect low initial insurer offers rather than gaming, implying insurer cost pressure may be partly self-inflicted through offer strategy.
Key entities
- insurerCigna Group
CEO comments allege IDR abuse and cite unsustainable dispute volume concentrated among a small provider set.
- insurerUnitedHealthcare
Commercial CEO calls for IDR overhaul and quantifies incremental cost trend impacts tied to arbitration.
- insurerElevance Health
Adopted a multi-state operational penalty for hospitals using out-of-network providers, citing IDR abuse.
- providerHaloMD
Named as a top initiating company in dispute volume and involved in insurer litigation described in the article.
- providerTeam Health
Named among top initiating companies accounting for a large share of disputes in the period cited.
