Surprise-billing arbitration now costs $844 million every six months

The No Surprises Act built a referee for a narrow argument: when an out-of-network doctor and an insurer can't agree on a price, either side can take the dispute to a certified arbitrator instead of billing the patient.▸ Regulators sized the portal for that argument happening rarely. It didn't. Providers and insurers have instead turned the Federal Independent Dispute Resolution (IDR) process into a multimillion-case-a-year industry, and the fees meant to keep it self-funding have exploded along with it — just as regulators quietly made each dispute far cheaper to file.

When the Departments of Health and Human Services, Labor, and the Treasury designed the Federal IDR process in 2021, they sized it for a modest caseload.▸ Reality blew past that estimate almost immediately: per the Departments' own fact sheet on clearing the IDR backlog, the portal's first year drew "an influx of disputes nearly 14 times greater than what was initially projected — and the annual volume is now more than 100 times the initial projection."

Disputes initiated grew from 200,112 in the program's first full year to 679,156 in 2023 — and more than 1.46 million in 2024, per the Congressional Research Service.▸ Then 2025 kept accelerating: 1,186,812 disputes were initiated in just the first six months, 39% more than the last six months of 2024 — a single half-year that alone exceeds the portal's entire first two years combined. A small number of filers drive most of it: the top ten initiating parties accounted for roughly 69% of all disputes in the first half of 2025, and just three billing and practice-management firms — HaloMD, Team Health, and SCP Health — filed about 44% of them.

Certified IDR entities have kept pace on paper: they closed 1,349,343 disputes in the first half of 2025, 14% more than were initiated in that span, per the same CMS report.▸ But "keeping pace" still leaves a large number of cases unresolved. Per the backlog fact sheet, more than 600,000 disputes were awaiting determinations at the start of 2025, with 69% of them already more than 30 business days old — the statute's general target window. By July 2025 the open caseload had fallen to 363,099, of which 34% were still over 30 days old. Handling that caseload falls to just 15 certified IDR entities nationwide — two of them added only in 2025 — even though the Departments say they've received over 120 applications for certification and finished reviewing more than three-quarters of them.

Every dispute carries two fees: a non-refundable administrative fee, split between both parties, meant to keep the process "self-sustaining," and a separate fee paid to whichever certified IDR entity decides the case.▸ As volume climbed, so did the price of running the system.

The fee started at $50 per party under the Departments' original Calendar Year 2022 Fee Guidance.▸ It more than doubled to $115, finalized effective January 22, 2024, after a brief, court-vacated attempt to set it at $350. Then, in a final rule the Departments published May 28, 2026, the fee was cut 87% — to $15 per party per dispute, "regardless of the amount in dispute or the dispute's eligibility."

That fee cut landed just as fee revenue was spiking.▸ Georgetown's Center on Health Insurance Reforms calculated that combined administrative and IDR entity fees totaled $844 million in the first six months of 2025 alone — nearly matching the $885 million CHIR estimated was paid across the program's first three years, 2022 through 2024, combined. Put another way: one half of one year now costs almost as much to arbitrate as the program's first thirty months. Providers and facilities, who initiate 99.9% of disputes and won roughly 88% of payment determinations made in the first half of 2025, have every incentive to keep filing at this pace. Cutting the entry fee 87% removes the one lever that made filing more of them cost more.

Dispute-volume figures come from two different reporting vintages (CRS's annual totals and CMS's own half-year supplemental reports) that may be revised slightly between releases; fee totals are Georgetown CHIR's calculation from CMS's raw public use files, not a CMS-published sum.