The Departments of Labor, Health and Human Services, and Treasury jointly issued FAQ Part 73 concerning the implementation of the No Surprises Act Independent Dispute Resolution (IDR) process on April 1, 2026.
The new FAQ signals a mixed (actually mostly unfavorable) development for physicians seeking higher reimbursement from managed care plans through the IDR process.
Background: The No Surprises Act and the Federal IDR Process
The No Surprises Act, enacted as part of the Consolidated Appropriations Act, 2021, provides protections against surprise medical bills for participants, beneficiaries, and enrollees in group health plans or individual health insurance coverage with respect to certain out-of-network services. The Act added provisions to the Internal Revenue Code, ERISA, and the Public Health Service Act to prohibit balance billing and limit cost sharing for emergency services provided by nonparticipating providers and facilities, non-emergency services at participating facilities, and air ambulance services.
The Departments, along with the Office of Personnel Management (OPM), issued interim final rules in July 2021 and October 2021, followed by final rules in August 2022, implementing key provisions of the No Surprises Act. These rules established a Federal IDR process for resolving disputes between plans or issuers and providers about the out-of-network rate for items or services subject to the No Surprises Act when state law does not apply and the parties cannot reach agreement through open negotiation.
On August 24, 2023, the U.S. District Court for the Eastern District of Texas issued its decision in Texas Medical Association v. HHS (TMA III), vacating certain provisions of the July 2021 interim final rules related to the methodology for calculating the Qualifying Payment Amount (QPA). The district court held that several provisions – including the inclusion of contracted rates “regardless of the number of claims,” the exclusion of single case agreements, and the exclusion of bonus, incentive, and risk-sharing payments – were unlawful.
The TMA III Litigation and Repeated Enforcement Extensions
Since TMA III, the Departments have repeatedly extended enforcement discretion allowing plans and issuers to continue using the 2021 methodology for calculating QPAs. FAQs Part 62 (October 2023), Part 67 (May 2024), Part 69 (January 2025), and Part 71 (July 2025) each extended relief as the litigation progressed through the Fifth Circuit Court of Appeals.
On October 30, 2024, the Fifth Circuit partially reversed the district court’s decision, reinstating certain provisions related to the QPA methodology. However, on May 30, 2025, the Fifth Circuit granted plaintiffs’ petition for rehearing en banc and vacated the panel opinion, meaning the original district court decision continues to bind the Departments pending the en banc decision.
Reinforcing the Status Quo
At its core, FAQ Part 73 extends enforcement discretion allowing plans and issuers to continue using the 2021 methodology for calculating the QPA through at least October 1, 2026. This extension applies not only to patient cost-sharing calculations but also to disclosures and submissions in the federal IDR process.
For physicians, this is significant because the QPA remains the central benchmark in IDR proceedings. Although prior litigation—particularly TMA III—challenged aspects of the QPA framework, this FAQ effectively preserves existing methodology during ongoing judicial uncertainty. That continuity favors payors, who benefit from lower QPA benchmark rates.
Implications for Physician Reimbursement
From a provider perspective, the extension limits near-term opportunities to achieve higher IDR awards. The QPA remains a significant factor in arbitration. Arbitrators frequently anchor their decisions to the QPA, even where other statutory factors are considered. By maintaining the current methodology, HHS reduces the likelihood that IDR entities will deviate meaningfully from QPA-driven outcomes.
Moreover, FAQ Part 73’s broad application – extending to disclosure, cost-sharing calculations, and IDR submissions – signals a regulatory preference reliance on the QPA as the primary reference. Physicians hoping that the TMA III litigation would disrupt or weaken the QPA’s influence may find that the pendency of the en banc proceeding and enforcement extension delays any such shift.
Bottom Line
While framed as temporary enforcement relief pending the Fifth Circuit’s en banc decision, FAQ Part 73 effectively entrenches the existing QPA framework for the foreseeable future. For physicians pursuing higher out-of-network reimbursement through the Federal IDR process, that is an unfavorable development, as it preserves a payment benchmark that has historically constrained award amounts and favored payors.
Reed Smith will continue to follow developments related to the No Surprises Act. If you have any questions about this FAQ document or anything involving the No Surprises Act, please do not hesitate to reach out the authors or other health care lawyers at Reed Smith.