PHI Health LLC has filed suit against Anthem, alleging that the insurer and health plans it administers have failed to pay about $30 million in final payment determinations issued under the No Surprises Act (NSA)’s independent dispute resolution (IDR) process. The suit, which PHI filed in an Indiana federal district court, seeks over $1.3 million in interest on the payments that Anthem is accused of withholding.
The NSA is designed to protect patients from certain unexpected medical bills, such as those for out-of-network emergency care in hospitals and air ambulance transportation. If a healthcare provider and the insurer cannot agree on an appropriate reimbursement amount, each party submits its proposal to an independent arbitrator for a decision under the NSA’s IDR process. IDR decisions are binding on the parties, and full payment is generally due within 30 days.
PHI alleges that Anthem has failed to comply with IDR determinations by not paying some NSA awards for months. According to PHI, Anthem has also delayed and underpaid awards to pressure providers to accept lower payments or enter network agreements at rates below prevailing market rates.
In response, Anthem claims that it has followed the requirements of the IDR process. The insurance giant also points out that only certain disputes are subject to IDR under the NSA, and it supports reforms to ensure the IDR process encompasses only properly eligible disputes.
PHI’s case is one of a fast-growing number of lawsuits challenging all aspects of the NSA’s IDR process. Providers have challenged the federal regulations underlying the IDR process, insurers have accused providers of submitting ineligible or inflated claims to IDR, and providers are pursuing NSA awards that they have not received from insurers.
One aspect of the IDR process that has drawn particular attention is the volume and resolution of disputes. Data show that providers, not insurers, initiate most disputes and win most cases. Like Anthem, many insurers claim that providers and, in some cases, their intermediaries, have overwhelmed the system with disputes that are either ineligible for IDR or seek reimbursements that exceed median in-network rates.
Courts have issued mixed decisions about whether parties can sue over IDR determinations. IDR decisions are supposed to be binding, and to that end, some courts have allowed narrow enforcement claims to proceed. Other courts have found that providers have no private right to file suit to enforce an unpaid IDR award, which undermines the system’s characterization as binding.
PHI’s suit highlights this contradiction. While the IDR process has produced final and binding payment determinations, it remains unclear whether a court can compel payment of the determined awards and whether a party can seek court intervention to enforce payment.
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