Trump Sets New Rules for Surprise Medical Bill Arbitration (1)

The Trump administration on Thursday finalized new parameters for health insurers and providers settling disputes over surprise medical bills, in a rule addressing some of the provisions that federal courts struck down.

The final rule (RIN: 0938-AV15) from the Office of Personnel Management, the IRS, the Department of Health and Human Services, and the Department of Labor amends a series of prior regulations outlining guardrails for the independent dispute resolution process under the No Surprises Act. The law requires providers and insurers to resolve most unexpected out-of-network bills instead of balance-billing patients.

“We are cutting fees, improving transparency, and restoring order to a system that was overwhelmed,” Centers for Medicare& Medicaid Services Administrator Mehmet Oz said in a statement. “This is about making government processes efficient, accountable, and focused on results.”

The industry hopes the rule will help fix some of the issues plaguing arbitration. Data show that doctors are winning nearly 90% of disputes, while insurers are still defaulting around 20% of the time. Courts are flooded with lawsuits from both providers and insurers, but judges are largely tossing lawsuits over a lack of jurisdiction.

“By requiring clearer payment information, more meaningful engagement during negotiations, and stronger oversight of the IDR process, the final rule helps ensure the system works more fairly and efficiently,” said Charlene MacDonald, president and CEO of the Federation of American Hospitals. “We look forward to continuing to work with the Administration to implement these regulations and ensure the law continues to protect patients while supporting a fair, transparent dispute resolution process.”

The rule addresses a series of complaints that have cropped up in the courts, including allegations that insurance companies are gaming the process for selecting an arbitrator. The final rule requires parties to send dispute notices and confirmations of receipt through the federal portal within specified timeframes.

Insurers must also include additional information for doctors in their initial payment notices, including arbitration registration numbers to help providers distinguish between separate plans the insurance company administers. The move aims to reduce communication issues that have made arbitration more difficult, which insurers also point to as a reason their default rate remains high. Both parties would be required to submit additional information to help arbitrators determine eligibility.

The rule also slashed the administrative fee that each party pays from $115 to $15, and caps how many disputes can be batched together.

CMS first proposed the rule in October 2023, before courts overturned major portions of the Biden administration’s regulations. The most prominent ruling limited how arbitrators weigh the median in-network rate—also known as the qualifying payment amount—following a series of successful court challenges from the Texas Medical Association.

In August 2024, the US Court of Appeals for the Fifth Circuit upheld a lower court decision that a rule directing arbitrators to make the QPA a primary factor in decisions overstepped the agencies’ authority.

The Fifth Circuit in October 2024 delivered a mixed bag ruling in another TMA case challenging how the QPA is calculated and when the arbitration timeline starts. But the court granted TMA a rehearing in May 2025, and the case is still pending.