La loi No Surprises a protégé les patients des grosses factures médicales. Today, its arbitration system risks increasing costs.

A law designed to protect patients from surprise medical bills has succeeded in eliminating unexpected charges, but

This practice ultimately increases health care costs for consumers, according to a CBS News investigation.

The arbitration system created by Congress to resolve disputes between insurers and out-of-network providers allows doctors and resolution specialists acting on their behalf to obtain payments many times higher than typical rates for medical services. These costs aren’t going away: Much of the money comes from employer-sponsored health plans, meaning workers can ultimately pay for it by paying higher premiums or reduced benefits.

Dans le cadre du système d’arbitrage établi par la loi No Surprises, entrée en vigueur en 2022, les assureurs paient aux prestataires de soins de santé des centaines de dollars pour des tests de laboratoire de routine qui coûtent généralement entre 10 et 30 dollars, ont déclaré des chercheurs du secteur à CBS News. In one case, a plastic surgeon was paid more than $400,000 to perform a breast reduction, a procedure the insurer said it previously paid the doctor between $6,000 and $30,000 to perform.

Plastic surgeon Dr. Norman Rowe regularly received about 170 times the benchmark rates for his services under the NSA’s arbitration system, according to a CBS News analysis of public data.

A spokesperson for Dr. Rowe told CBS News that insurers manipulated referral rates for doctors and created “artificially low reimbursement rates.”

“Dr. Rowe uses the widely recognized FairHealth benchmarks set by the independent, nonprofit FairHealth.org using reliable, objective market data. FairHealth data is so reliable that it is incorporated into laws and regulations across the country and serves as the official data source for many state health programs,” the spokesperson added.

In addition to the typical benchmark rate considered by arbitrators (known as the “eligible payment amount” or QPA), FairHealth offers another rate that can be used during the dispute resolution process. Medicare rates, however, may not be taken into account.

CBS News a découvert qu’un autre médecin – le chirurgien de la colonne vertébrale de Long Island, Vadim Lerman – s’était vu accorder en moyenne 280 fois les taux de référence en arbitrage. He declined an interview, but a Lerman spokesperson said “the suggestion that a doctor receives rates ‘hundreds of times’ higher than benchmarks is incorrect. No comparison should be made between the insurer’s initial offer – which may be inappropriate for a complex surgical procedure – and the reward given to the doctor.”

“Baseball-style umpiring”

Insurers have, in many cases, been forced to pay high rates like those charged by Dr. Rowe under the law’s so-called “baseball-style” or “pendulum” arbitration system.

In arbitration under the No Surprises Act, insurers and providers each offer a rate for a given service. There is no room for negotiation, as an arbitrator must choose between one of the numbers offered by both parties.

Arbitrators side with providers in more than 85% of cases, according to Leland Robbins, product manager at Turquoise Health, a data transparency startup. Some arbitrators — formally called independent certified dispute resolution entities, or IDRs — have already sided with providers in an even larger share of cases, according to Robbins’ group.

He told CBS News that while patients are no longer surprised by large medical bills, the new system presents a problem.

“The transaction didn’t disappear. It happened behind closed doors and ended up in this arbitration process when a payer and a provider can’t agree on the right price,” Robbins said. “Since 70% of these rewards are being taken out of employer-sponsored health plans, consumers are going to start to see that when it comes time to freely enroll.”

He added: “You know, employers are not able to bear and absorb these kinds of high costs. They probably won’t pay as much of your premiums. »

L’année dernière, 15 arbitres certifiés par le gouvernement ont perçu des honoraires par affaire, et 17 arbitres sont aujourd’hui désignés pour effectuer ce travail. Each party to the dispute – the health care provider and the insurer – participates in the process before the arbitrator makes a decision.

In the first six months of 2025, insurers and providers submitted 1.2 million new disputes to the arbitration portal, when federal officials expected only about 17,000 cases per year, according to a study by the Center on Health Insurance Reforms (CHIR) at Georgetown University’s McCourt School of Public Policy.

However, HaloMD, a company that files on behalf of providers, told CBS News that the initial estimates “were objectively flawed in the way they calculated expected volume.”

Collectively, the arbitrators who make the decisions have earned more than $2 billion in fees. None agreed to on-camera interviews with CBS News.

New Jersey House Representative Frank Pallone, a Democrat and lead sponsor of the No Surprises Act, blames private equity, in part, for breaking the system it helped create.

He said only a few private equity firms — which are increasingly buying up anesthesiology, radiology and emergency room practices — are running the arbitration cases.

Pallone told CBS News that doctors should be paid the equivalent of network rates for the services they provide, but said “we had no choice” but to introduce the arbitration system “if we really wanted to get rid of surprise billing.”

“I knew it wasn’t going to go well, but I didn’t know it was going to be this bad,” he added.

Dispute Resolution in the Cottage Industry

The law’s arbitration provision also created an opportunity for intermediaries to guide providers through the process and reap profits by accepting a reduction in bills up to 1,000 percent above the benchmark rate for a service, CBS News found. Les critiques soutiennent que ces entreprises exigent plus d’argent de la part des prestataires, ce qui conduit à des règlements importants qui font augmenter les coûts pour tout le monde.

HaloMD presents itself as the “expert” in arbitration cases brought under the No Surprises Act. Founded by Texan couple Scott and Alla Laroque in 2022, the same year the No Surprises Act came into effect, the company is one of the biggest players in this nascent sector.

Private equity firms also sometimes own both physician recruitment companies and independent dispute resolution entities, creating a conflict of interest and undermining the fairness of the law. HaloMD is not backed by private equity, but Halo and two other groups that have invested in buyout companies collectively handled more than 75% of disputes resolved through arbitration last year, according to the Center on Health Insurance Reforms at Georgetown University.

According to Halo, the company has earned more than $1 billion for its customers, regularly winning rewards nine times the benchmark rates for the services. Halo takes a cut of the payments but has not disclosed the amount.

Patrick Velliky, Halo’s director of external affairs, told CBS News that insurance companies, not companies like his, are responsible for driving up consumers’ health care costs, either by not participating in the arbitration process or by submitting ridiculously low offers.

“24% of the time, insurers lose by default. They haven’t submitted an offer at all. 9.5% of the time, insurers submit an offer, like a dollar or less,” Velliky told CBS News. “So what it actually looks like: A patient goes to the emergency room with a heart attack, we go to arbitration and the insurer offers a total of $1.00.”

He also said that insurance companies offer misleading information about the benchmark rate. “Quel que soit le taux médian réel sur le réseau, ce n’est pas ce que l’assureur a présenté”, a déclaré Velliky à CBS News. “They’re miscalculating.”

A federal court ruled in favor of providers on this issue this summer, saying the benchmark rate is “artificially low,” driven down by insurers’ offers of $0 or $1 reimbursement to doctors.

Proposed reforms

He plans to introduce legislation this week to eliminate the arbitration process and stipulate that providers will be paid in-network rates, even if they are out-of-network. Pallone’s office also told CBS News that so-called phantom rates, which often lower the benchmark rate, will be excluded from calculations in the future.

“Whether it’s the hospitals, the doctors, the nurses, they’re really trying to take care of people. Of course, they should all have a decent income to be able to live,” the New Jersey lawmaker said. “But why should these outside investors make all this money primarily from, you know, your insurance premiums?”