The No Surprises Act was built to protect patients from unexpected bills for emergency care they had no hand in choosing. That protection has held since the law took effect in 2022. But the debate over its cost impact has centered on arbitration outcomes. A new analysis suggests that framing may be missing the full picture.
HaloMD’s latest report examines the full universe of out-of-network (OON) emergency medical claims subject to the NSA and applies a historically grounded baseline to measure cost impact against what OON care actually cost before the law took effect. The analysis found the total OON emergency spending has fallen between 12% and 52% since the NSA took effect, representing between $1 billion and $4 billion in annual savings depending on the model used.
The report drew on previously published data from the Brookings Institution, AHIP, the Blue Cross Blue Shield Association, and the Centers for Medicare and Medicaid Services. It even found that the most conservative scenario, one deliberately constructed to project insurers’ criticism of the law, shows nearly a 13% reduction in OON emergency spending relative to the pre-NSA baseline.
The core problem with most existing analyses, the new research argues, is that they focus heavily on arbitration outcomes while ignoring the vast majority of claims subject to the NSA and what all of it would have cost before 2021. The NSA’s Independent Dispute Resolution (IDR) process moves through three stages: initial payment, a 30-day open negotiation period, and, only if both prior stages fail, arbitration.
According to 2024 claims data from AHIP and the Blue Cross Blue Shield Association, 76.4% of qualified OON claims are resolved at the initial payment stage, 18% are settled during open negotiation, and about 6% reach arbitration. In total, arbitration accounts for less than 0.12% of all commercial claims. Treating IDR award trends as a proxy for the NSA’s system-wide cost impact is, as the research puts it, treating the narrowest point of the funnel as if it were the funnel itself.
The baseline question is equally important. To assess the NSA’s cost impact, the analysis established what the same volume of OON emergency claims would have cost if the NSA never went into effect. Drawing on the Brookings Institution’s NSA arbitration databook, the analysis applied the midpoint of the estimated pre-NSA OON allowed amount range (483.8%) to a volume-weighted emergency medicine Medicare rate of $132.6, producing a pre-NSA baseline of $641.71. Applied to an estimated 11.9 million annual OON emergency claims, that produces a pre-NSA total of approximately $7.64 billion.
Current spending was then modeled across three scenarios. Using the QPA as the non-IDR payment rate, total OON emergency spending falls to roughly $3.68 billion, a 51.75% reduction.
At QPA +50%, spending comes in at $5.17 billion, a 32.28% decline. Even at QPA +100%, double the insurer benchmark, the total reaches $6.66 billion, still 12.8% below the pre-NSA baseline.
For healthcare leaders navigating ongoing IDR reform proposals, arbitration data alone cannot answer the cost question. The 90% of OON disputes resolved before an arbitrator ever weighs in are where the real financial story lives, and by that measure, the No Surprises Act appears to be delivering on both patient protections and overall savings.
