Anthem Is Closing a Costly Loophole in the Independent Dispute Resolution Process

The Independent Dispute Resolution (IDR) process established under the federal No Surprises Act is increasingly being used in ways the law never intended, driving up healthcare costs for middle-class families, with small employer and self-funded plans being hit the hardest.

The process was designed to protect consumers from being drawn into payment disputes between out-of-network providers and health plans by requiring health plans and providers to resolve these issues directly between themselves – keeping patients out of the middle. However, the process is being abused by a subset of healthcare providers.

- Ariel Bayewitz, Vice President of Health Economics, Elevance Health & Julie Goon, Senior Vice President of Public Affairs, Elevance Health

Why We’re Taking a Stand Against IDR Abuse That Drives Up Costs

The system is broken.

The IDR process was designed to let payers and providers resolve payment disputes for “surprise bills” resulting from emergency services and certain non-emergency services provided by out-of-network providers at in-network facilities

The intent was simple: keep patients out of the middle and let payers and providers resolve payment disputes behind the scenes.

A small subset of out-of-network providers are exploiting gaps in the IDR process to obtain inflated payments that are far above normal market or in-network rates for non-emergency, scheduled procedures that were not the intended “surprise” services contemplated by the No Suprises Act.

This drives up healthcare costs – particularly for self-funded employers, who bear the vast majority of IDR-driven expense.

To Address This, Anthem is Taking Action

Beginning January 1, 2026, Anthem will implement a facility administrative policy that applies a payment penalty when an in-network hospital uses out-of-network physicians for non-emergency care despite reasonable in-network alternatives.

This policy:

Does not affect emergency care or situations where no in-network providers are available.
Does not change member cost-sharing or balance-billing protections.
Encourages use of in-network providers so planned procedures at in-network hospitals are performed by in-network physicians whenever reasonably possible.

Our focus remains on protecting consumers and employers from inflated costs while preserving access to affordable, seamless, and predictable care.

Recent News Coverage:

Med City News: Is It Time to Change the Independent Dispute Resolution Process of the No Surprises Act?

RealClear Health: No surprises, for real

Modern Healthcare: Fixing the costly loopholes undermining the No Surprises Act

Fierce Healthcare: Why Anthem is set to penalize facilities that use out-of-network providers

Frequently Asked Questions

The NSA is a federal law enacted in 2020 to protect patients from unexpected medical bills. It ensures that if you get care at an in-network hospital, especially in emergencies, you won’t be surprised by charges from out-of-network doctors you didn’t choose. Instead of sending you the bill, the law requires insurers and care providers to work out the payment behind the scenes.

IDR is the arbitration process created under the NSA. When insurers and out-of-network providers cannot agree on a payment for emergency services, air ambulance services, or non-emergency out-of-network care at in-network facilities, each submits an offer and a certified arbiter chooses one.

IDR was intended for rare, unavoidable surprise-bill situations – not for routine, planned procedures.

Misuse of IDR drives up the overall cost of care, as has been shown in a study of the process’ unintended consequences. That’s because some out-of-network care providers are using IDR for planned, non-emergency procedures that were never meant to qualify, and some are securing awards far above market rates and even above their own billed charges. This floods the system, increases administrative costs, and ultimately puts upward pressure on what patients, employers, and taxpayers pay for healthcare.

Anthem is taking action to protect affordability and preserve the original intent of the No Surprises Act. IDR abuse undermines the law by rewarding some care providers who intentionally stay out of network and then demand inflated payments through arbitration. By closing this loophole in our own network policies, we’re reducing unnecessary costs and keeping care predictable and affordable for our members.

That was the intention, but it’s being widely abused. IDR was meant to settle rare, unexpected billing disputes — not to become a high-priced payment channel for routine, non-emergency care. These inflated awards raise healthcare costs across the system. Anthem supports reforms that ensure IDR works as originally intended: protecting its members, not driving up prices.

How Anthem Is Closing the IDR Loophole