Health care providers, group health plans, their plan sponsors and fiduciaries, and their claims and billing service providers should review and update their processes for handling out-of-network provider charge disputes in response to the CMS, Federal Independent Dispute Resolution Operations; Final Rules (CMS-9897-F, full text PDF) released on May 28, 2026 to implement the No Surprises Act (“NSA”). See also CMS, Federal Independent Dispute Resolution Operations Final Rule (Fact Sheet); HHS, Federal Rule Takes Aim at Health Care Bureaucracy, Reducing Dispute Fees, and Boosting Transparency (Press Release, May 28, 2026).

The rule issued by the Departments of Health and Human Services, Labor, and the Treasury (the “Departments”), acting through the Centers for Medicare & Medicaid Services (“CMS”) and joined by the Office of Personnel Management (“OPM”), overhauls the operational mechanics of the federal arbitration process that the NSA requires group health plans, issuers, Federal Employees Health Benefits carriers (“payers”), and out-of-network providers, facilities, and air ambulance providers (“providers”) use to resolve out-of-network payment disputes. (CMS Fact Sheet; HHS Press Release). Also see CMS, No Surprises Act — Overview of Rules & Fact Sheets.

According to the Departments, the Federal IDR process has received more than 5 million disputes since launching in April 2022—far beyond projections, generating delays, backlogs, and unnecessary cost. (HHS Press Release). Much of the rule targets a recurring problem: ineligible disputes clogging the pipeline because parties cannot readily tell, early on, which claims actually qualify for federal arbitration.

Below is a practical summary of the key changes and, importantly, the staggered dates on which they take effect.

IDR Administrative Fee Drops to $15

For parties weighing whether to use the process, the most immediate change is cost. The per-party, per-dispute administrative fee falls from $115 to $15—a reduction of more than 85%—while the program remains self-sustaining as the statute requires. The $15 fee applies regardless of the amount in dispute or whether the dispute is ultimately found eligible. (HHS Press Release; CMS Fact Sheet).

The rule also codifies existing guidance: if a party fails to pay the administrative fee or the certified IDR entity fee by the time its offer is due, that offer will not be considered received—but the party remains liable for the fees. The Departments further clarified their authority to pursue unpaid administrative fees consistent with federal debt collection laws. (CMS Fact Sheet).

Improving Communication Up Front (CARCs and RARCs)

A central theme of the final rule is forcing better information exchange before a dispute ever reaches arbitration. The rule requires payers to use specific claim adjustment reason codes (“CARCs”) and remittance advice remark codes (“RARCs”) on any paper or electronic remittance advice sent to an entity with which the payer has no contractual relationship, signaling whether a claim is or is not subject to the NSA’s surprise-billing provisions and the federal IDR process. (CMS Fact Sheet).

Payers must also disclose additional identifying information with the initial payment or notice of denial of payment, including:

• The legal business name of the plan, issuer, or FEHB carrier,
• The plan sponsor’s legal business name where applicable, and
• The new IDR registration number (discussed below), and
• Include a statement explaining that providers must notify the Departments to initiate open negotiation. (CMS Fact Sheet).

Restructured Open Negotiation

The final rule meaningfully tightens the 30-business-day open negotiation period. Under the final rule, a party must submit an open negotiation notice through the Federal IDR portal to both the other party and the Departments, with expanded required content elements. The 30-business-day clock now begins when that notice and the payment remittance or denial are submitted through the portal. The rule also creates a new open negotiation response notice, which the receiving party must furnish by the 15th business day of the negotiation period. (CMS Fact Sheet).

These mechanics are designed to document clear start and end dates in the portal and cut down on disputes advancing to arbitration without genuine negotiation.

New Batching Rules—and a 50-Item Cap

The rule revises when items and services may be combined into a single “batched” dispute. Batching is permitted where the items and services are:

• Furnished to a single patient on the same or consecutive dates of service and billed on the same claim form (a patient encounter);
• Furnished to one or more patients and billed under the same service code or a comparable code under a different procedural code system (e.g., CPT and HCPCS); or
• Anesthesiology, radiology, pathology, and laboratory services furnished to one or more patients under service codes within the same Category I CPT code section, as specified in Departmental guidance.

Critically, the rule imposes a hard ceiling of 50 qualified IDR line items per batched dispute, so certified IDR entities can make timely determinations and forecast their costs. (CMS Fact Sheet).

Hard Deadline on Eligibility Determinations

Eligibility review has been the single biggest source of delay. The rule now requires certified IDR entities to determine eligibility within five business days of final entity selection and to notify both parties and the Departments.

To support eligibility, conflict-of-interest, and payment determinations, parties must respond to a certified IDR entity’s request for additional information within 5 business days. If a party does not respond, the entity proceeds without the information where possible, or closes the dispute where it is not. (CMS Fact Sheet).

New IDR Registry for Payers

To solve the persistent problem of providers being unable to identify the correct payer or contact, the final rule requires payers subject to the federal IDR process to register with the Departments and supply general information about how the process applies to their coverage.

The registry is part of the broader IDR Gateway—a centralized platform for starting, tracking, and managing disputes that the Departments will roll out in phases beginning in 2026. (HHS Press Release).

Each registrant receives an IDR registration number that parties can use to confirm eligibility, and that the Departments, OPM, and certified IDR entities can access for enforcement and eligibility purposes. (CMS Fact Sheet).

Extenuating Circumstances

The final rule expands the extenuating circumstances under which IDR timeframes may be extended to include events causing systemic processing delays, such as an unforeseen volume of disputes or portal system failures, and commits the Departments to posting public notice of any such system-wide extensions. Parties also may still request individual extensions through the portal. (CMS Fact Sheet).

Staggered Effective Dates

Covered parties must mind the staggered effective dates of the various components of the final rule. Compliance planning here is complicated by a phased rollout. Based on the Departments’ applicability discussion:

• CARC/RARC communication and the QPA disclosure modifications take effect on the rule’s effective date, with implementing guidance to follow.
• The lower $15 administrative fee applies to disputes initiated on or after 5 business days after publication of the final rule (the Departments invoked good cause to waive the APA’s delayed-effective-date requirement).
• The fee-nonpayment procedures apply on the effective date.
• The revised batching definition applies to disputes with open negotiation periods beginning 90 days after the effective date.
• Most IDR process changes (open negotiation, IDR initiation, certified IDR entity selection, eligibility review, batched/bundled treatment, offer and payment-determination deadlines, and certain withdrawals) apply to disputes with open negotiation periods beginning 90 days after the Departments issue guidance that the supporting functionality is available.
• The IDR Registry provisions become applicable 90 business days after the Departments announce that the registry functionality is available. (CMS Fact Sheet)

Litigation Backdrop: Courts Keep Rejecting Payers’ Collateral Attacks on IDR Awards

The final rule arrives against a wave of litigation in which payers—frustrated by the very volume problem the rule targets—have tried, and so far failed, to undo unfavorable IDR outcomes in court. Although payers largely pushed for the NSA IDR process, today’s, providers have used the rules more effectively than payers. Payers have struggled to effectively operationalize their response to the NSA IDR process. Payers have brought suits complaining that providers and their billing intermediaries have overwhelmed the system by submitting large numbers of allegedly ineligible disputes, inflating out-of-network reimbursement at plans’ (and ultimately consumers’) expense. Providers have disputed these allegations.

The most recent decision came on May 22, 2026, when the U.S. District Court for the Eastern District of Texas dismissed, with prejudice, all seven claims that Blue Cross Blue Shield of Texas (a division of Health Care Service Corporation) brought against HaloMD, the largest filer of IDR disputes, and affiliated provider defendants. BCBS Texas accused HaliMD and the providers in that suit of RICO, fraud, fraudulent inducement, negligent misrepresentation, and related state-law claims, alleging that the defendants gamed the federal and Texas IDR processes by attesting to eligibility on disputes that were not eligible—seeking, by the defense’s account, to unwind tens of thousands of binding IDR awards.

The court treated those Blue Cross claims as damages tethered to the IDR awards themselves and therefore an impermissible collateral attack on determinations Congress made binding and largely insulated from judicial review. The court also declined to read the injunctive-relief request as a freestanding cause of action. Blue Cross Blue Shield of Texas v. HaloMD, LLC, No. 5:25-cv-00132-RWS (E.D. Tex. May 22, 2026).

The Blue Cross Blue Shield of Texas v. HaloMD, LLC ruling tracked a nearly identical outcome weeks earlier in the April 2026 suit by Anthem Blue Cross (Elevance Health’s California subsidiary) against HaloMD and affiliated providers. In Anthem Blue Cross Life & Health Ins. Co. v. HaloMD LLC, No. 8:25-cv-01467-KES (C.D. Cal. 2026), the U.S. District Court for the Central District of California dismissed without leave to amend the payer’s suit, reasoning that the No Surprises Act forecloses judicial review of IDR payment determinations on all but narrow grounds, and that a certified IDR entity’s payment determination necessarily incorporates the threshold eligibility determination—closing the door on the payer’s theory that it was challenging “eligibility” rather than the award. 

These were not isolated results. With the Blue Cross Blue Shield of Texas Eastern District of Texas decision, four federal courts already rejected comparable insurer attempts to relitigate IDR awards within roughly six weeks, with parallel dismissals also reported in the Middle District of Florida and the Eastern District of Pennsylvania. The statutory anchor running through the decisions is the NSA’s limitation on judicial review of IDR determinations in 42 U.S.C. § 300gg-111.

The practical lesson is twofold.

• For providers and their billing partners, the binding nature of IDR awards remains a meaningful shield, but the same volume-and-eligibility concerns driving this litigation are now embedded in the regulatory framework, which is designed to keep ineligible disputes out of the process in the first place.
• For payers, courts are signaling that collateral litigation is a poor substitute for fixing eligibility and communication problems at the front end—precisely what the new operational rule attempts to do through CARCs/RARCs, portal-documented open negotiation, the five-business-day eligibility deadline, the 50-item batching cap, and the IDR Registry.

Key Takeaways for Plans, Payers, and Employers

For plan sponsors, self-insured employers, issuers, and their third party administrators, the action items are concrete. Payers must begin mapping the CARC/RARC requirement into their remittance and EDI workflows, confirm that initial-payment and denial disclosures will carry the new legal-name and registration-number elements, and prepare to register in the IDR Registry once functionality opens. Plan sponsors and fiduciaries should review contracts to ensure contracts appropriately assign responsibility and accountability of their third party administrator or other service providers, and review the reasonability and appropriateness of processes and compensation keeping in mind that the Labor Department views NSA administration and selection, oversight and management, and compensation of vendors as fiduciary conduct.

Both payers and providers should revisit internal protocols so open negotiation notices and responses are submitted through the portal within the new deadlines, and so requests for additional information from certified IDR entities are answered within the five-business-day window. Given the staggered applicability dates, organizations should watch for the Departments’ implementing guidance, which will control when several of the operational changes actually bind.

As this provides only a high-level summary of a lengthy and technical rulemaking, plans, their sponsors, fiduciaries and vendors, payers, and providers should review the full final rule and consult counsel before relying on any single provision, particularly given the phased effective dates and forthcoming guidance.

For Help or More Information

The author of this update, Cynthia Marcotte Stamer advises health care providers, employer and union sponsored self-insured group heath plans, their sponsors and fiduciaries, insurers, their service and technology providers, and other health industry clients on NSA and other coverage and payment, enrollment, compliance programs, government investigations, transaction due diligence, reimbursement compliance and disputes, audits and investigations, and other legal and operational compliance and risk management and legislative and regulatory affairs. She is available to assist your organization in assessing the impact of these developments and navigating the compliance and strategic steps that follow. For more information about these  or other health care, managed care and other health benefits, or other health care developments, please contact Ms. Marcotte Stamer via e-mail or via telephone at (214) 452 -8297.

About the Author

Peer recognized as “Top Rated Lawyer” and “LEGAL LEADER™ “Top Rated Lawyer” and “Best Lawyer” for her work in Health Care Law, Labor and Employment Law; ERISA & Employee Benefits,” and “Business and Commercial Law,” Cynthia Marcotte Stamer is an A Martindale-Hubble “AV-Preeminent” (Top 1%) attorneys board certified in labor and employment law by the Texas Board of Legal Specialization and management consultant, author, public policy advocate and lecturer widely known for her more than 35 years of health industry and other management work, public policy leadership and advocacy, coaching, teachings, and publications including leading edge work on PBM, pharmacy and pharmaceutical and other health care, managed care, insurance, and insured and self-insured contracting, design, administration and regulation.. 

Author of numerous highly regarded works on health care fraud and other compliance, risk management and operations,  Chair of the Tort Trial and Insurance Practice Section Medicine and Law Committee, past Chair of the ABA Health Law Section Managed Care & Insurance Interest Group, the ABA International Section Life Sciences Committee and the former Group Chair and Welfare Benefit Committee Co-Chair of the ABA RPTE Employee Benefits & Other Compensation Group, Ms. Stamer is widely recognized for her decades of pragmatic, leading edge work, scholarship and thought leadership on health industry legal, public policy and operational concerns. 

Ms. Stamer’s work throughout her career has focused heavily on working with hospitals, health care systems, long term care, rehabilitation, home health, hospice, clinics, and other health care organizations; physician and other provider organizations and practitioners; accreditation, medical staff, peer review, and quality committees and organizations; billing, audit, practice management, utilization management, EMR, claims, payroll and other technology, billing and reimbursement and other services and product vendors and services organizations; pharmaceutical, pharmacy, and prescription benefit management and organizations; DME; health care and managed care, health and other employee benefit plan, insurance and financial services and other public and private organizations; consultants; products and solutions consultants and developers; investors; managed care organizations, self-insured health and other employee benefit plans, their sponsors, fiduciaries, administrators and service providers, insurers and other payers, health industry advocacy and other service providers and groups and other health and managed care industry clients as well as federal and state legislative, regulatory, investigatory and enforcement bodies and agencies on billing and reimbursement, government investigations and enforcement, and other legal and operational compliance and risk management, performance and workforce management, regulatory and public policy, and other legal and operational concerns. 

Author of a multitude of highly regarded publications and presentations,  Ms. Stamer is widely recognized for her thought leadership on these and other health care, managed care and other health plan,and other health industry matters.  In addition, Ms. Stamer contributes her time and leadership to numerous policy, professional, civil and other organizations including service as the, the American Bar Association (ABA) International Section Life Sciences Committee Vice Chair, a Scribe for the ABA Joint Committee on Employee Benefits (JCEB) Annual OCR Agency Meeting and a former Council Representative, Past Chair of the ABA Managed Care & Insurance Interest Group, former Vice President and Executive Director of the North Texas Health Care Compliance Professionals Association, past Board President of Richardson Development Center (now Warren Center) for Children Early Childhood Intervention Agency, past North Texas United Way Long Range Planning Committee Member, and past Board Member and Compliance Chair of the National Kidney Foundation of North Texas, and a Fellow in the American College of Employee Benefit Counsel, the American Bar Foundation and the Texas Bar Foundation, Ms. Stamer also shares her extensive publications and thought leadership as well as leadership involvement in a broad range of other professional and civic organizations. For more information about Ms. Stamer or her health industry and other experience and involvements, see www.cynthiastamer.com or contact Ms. Stamer via telephone at (214) 452-8297 or via e-mail here.

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