| |  | The Lead Brief | Health insurers are often misreporting a metric used in disputes over surprise medical bills, which ultimately drives up health system costs and serves to “boost their bottom lines,” Americans for Fair Health Care, a coalition of providers that includes private equity-backed firms, argues in a newly released analysis. It’s the latest salvo in the battle over the No Surprises Act, a law meant to protect patients from massive medical bills when they’re unknowingly treated by out-of-network providers. The law has been in effect for nearly four years, but the two sides are still warring over the process. Insurers have said that some providers have flooded the dispute resolution system with claims and secured payouts well above in-network rates — primarily pointing the finger at providers backed by private equity firms. Now, providers are pushing back, saying some of the payment amounts being offered by insurance companies — and used in the mediation process — aren’t anywhere near negotiated in-network rates. Why it matters: The dispute over payment amounts strikes at the heart of whether the No Surprises Act is containing costs or driving them higher. The claimed inaccurate qualifying payment amounts, or QPAs, increase the use of the independent dispute resolution process and “[add] cost to the health care system,” said Eric Berger, executive director of Americans for Fair Health Care. “Providers have long claimed that health insurers are abusing the law to underpay clinicians and further boost their bottom lines,” he added, arguing that the report supports those allegations. → The arbitration process occurs when insurers and clinicians can’t agree on the price of a service. The process takes the QPA and other factors into account when deciding how much a health insurance company should pay for the bill. The disputes studied in the analysis showed that median in-network rates were, on average, 290 percent higher than the reported QPA. Insurers take issue with the report’s methodology, arguing that QPAs are calculated on a baseline and adjusted for inflation, per federal guidelines, rather than a snapshot in time. WIN RATES Various studies show that providers win most of the payment disputes, about 70 percent to 82 percent of the time. Research has shown that providers earn an average of 270 percent to 450 percent of the QPA, depending on various factors. In both studies, private equity-backed providers — which make up the bulk of disputed claims — earn significantly more. One PE-backed firm had an average payout 934 percent above the QPA on their disputes. “CMS data is painstakingly clear that out-of-network providers, particularly private equity-backed entities, are manipulating IDR and using the process as a shell game to drive up their reimbursement,” said Chris Bond, a spokesperson for insurance industry group AHIP, in response to the Americans for Fair Health Care report. However, Americans for Fair Health Care argues that the win rate occurs because “insurers routinely tie their offer to an inaccurate QPA, not because providers submit unreasonable claims.” In the fourth quarter of 2024, there were about 1,000 instances of QPAs listed as below $1, according to the report. “General awareness of the market dynamics in healthcare would tell us that this was likely inaccurate,” the analysis reads. In one case, a billing dispute over a complex emergency room visit had a QPA of one penny; the provider was awarded $1,196. Insurers explain that amounts of $1 or less could be a placeholder — signifying the company had already paid on the claim and did not owe any more. Back in October, I wrote about an analysis from the insurance industry that found that independent mediators flagged less than half of the dispute submissions that should have been deemed ineligible, resulting in insurers having to pay out on 184,500 improperly filed disputes. The industry has countered that it’s a small group of providers winning outsize awards that are driving up costs. Insurers, including Blue Cross Blue Shield Association’s David Merritt, pushed back that payment offerings are unreasonable: “In one instance, a Blue Cross and Blue Shield plan offered $6,193 for a service with a median in-network rate of $1,000, yet the arbiter awarded the provider $230,000 — a 23,000% increase with no justification,” he said in a statement. | 
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