STAT+: Providers notch No Surprises Act legal win that could boost their pay

The U.S. Court of Appeals for the Fifth Circuit issued a decision Tuesday in a long-running lawsuit by the Texas Medical Association challenging how the government calculates the qualifying payment amount (QPA) under the No Surprises Act. The QPA represents the median contracted rate health insurers pay for services and is used in arbitration disputes between providers and insurers over surprise bills. The trade group argued that the government's methodology yielded unfairly low numbers, and the court largely agreed.

The Fifth Circuit sided with providers on two of three key points: QPAs should not include 'ghost rates' — placeholder rates that providers do not actually negotiate — and they should include bonus and incentive payments that insurers make to providers. However, the court disagreed with air ambulance providers, ruling that a one-off price for a single patient transport should not be factored into QPAs.

The decision is another legal win for providers and could increase the amounts they receive in arbitration by producing higher QPA calculations, affecting how No Surprises Act disputes are resolved.