Ed Marasco

The initial intent of the No Surprises Act (NSA) was to enhance provider-payor relationships in a manner that would increase the dialogue, reduce the number of disputed claims and ultimately result in a higher percentage of in network relationships that would reduce the number of out of network claims across the healthcare system. The Independent Dispute Resolution (IDR) process was envisioned as an exception (rather than the rule) when the initial NSA rules were promulgated. The reality has been quite the opposite. 

The latest installment of the Federal IDR operations rule was released on May 28, 2026. This long, awaited, much anticipated rule makes some adjustments designed to streamline the process and reduce administrative burdens. 

Improving the Exchange of Information 

Both providers and payors have reported difficulty receiving key information necessary to resolve claims on a timely basis. This latest rule makes some adjustments to the process that are intended to reduce the level of confusion in the exchange of information.

• Standard Reason Codes/QPA Clarification

The new regulations will require payors to use a standard set of claim adjustment reason codes (CARCs) and remittance advice remark codes (RARCs) when they notify providers of their decision. Likewise, payors will be required to provide more consistent information regarding their computation of the Qualified Payment Amount (QPA). This may help providers understand exactly how the payor made its determination with respect to denial and/or payment level. In the case of air medical transports, this may help providers sort out why the payor did or didn’t pay for certain aspects of the services provided. 

• Payor Entity/Plan Information 

The new regulation requires payors to provide additional identifying information on each remittance. This may reduce the level of confusion later in the process. Since many health plan organizations offer a variety of coverage types/plans. There has been a great deal of confusion regarding plan types that are not currently covered by the NSA. For providers to follow the correct process under the NSA rules, they must know what type of plan they are dealing with. Historically, not having this information has contributed to a great deal of frustration and unnecessary administrative burden for both providers and IDR entities.  

• Open Negotiation 

The new rule will clarify the 30-business day timeline and require formal submission through the Federal IDR portal. In addition, the receiving party will now be required to acknowledge the activation of the Open Negotiation period. These requirements will formalize the process. The new process should also eliminate  disputes regarding official notice and claim timelines related to the use of the payor portals. The Open Negotiation process, under the current rules, has failed to achieve the intended outcomes: 1) promote a mutual effort to resolve individual claims before engaging the IDR process and 2) encourage provider-payor dialogue in a manner that will reduce the number of future claims that will require resolution under the NSA. The intent of the new regulation is to encourage active participation in the Open Negotiation process. 

• IDR Registry 

The new rule will require payors to register with the Departments and provide certain additional information regarding the plan eligibility for the NSA-related processes. Following submission, the health plans will be granted an IDR registration number. The intent is for this number to help IDR entities and providers to more easily communicate with health plans and determine NSA related eligibility. This may improve the effectiveness of the process and reduce confusion for both providers and IDR entities.

Streamlining the Process 

The current process has created a great deal of administrative burden for both providers and payors, as well as the IDR entities. The cost of carrying out the process and the resulting delays in payment creates an incredible burden on providers especially.

• Batching 

The new rule will add some parameters around the batching process under certain circumstances. If a single patient receives related services on the same date, which are submitted on the same claim form (e.g. base and loaded mile charges), the claims should be adjudicated together. This should clarify much of the confusion around breaking air ambulance claims into two separate claims, as opposed to treating them as one (as has been the expectation for decades). This should reduce the number of IDR submissions for air medical services claims overall. 

• IDR Eligibility 

The new rule will require IDR entities to determine eligibility of a claim for the process within five (5) days of IDR entity selection. In addition, the rule will establish requirements for parties to submit information regarding claim eligibility to IDR entities within a specified timeline. This change is designed to reduce delays in the IDR process and reduce some of the administrative burden experienced by IDR entities and providers. 

• Extenuating Circumstances 

The new rule makes provisions for exceptions to the NSA timelines for certain specific extenuating circumstances. Since the inception of the NSA, there have been certain situations (e.g. pandemic, portal inaccessibility, natural disasters, etc.) that have made it difficult for the parties to adhere to the required timelines. The intent of the rule is to make the process of granting exceptions clearer. 

• IDR Fees 

The new rule reduces the IDR Administrative Fee to $15 (from the current $150) and adds some enforcement provisions for both the IDR Administrative Fee and the IDR Entity Fee. The intent is to ensure that all claims that are eligible for the IDR process have access to it and to hold providers and payors accountable for the fees, so the process is sustainable. 

What Does All This Mean for Air Ambulance Providers?

The proposed rules are intended to address several key pain points in the NSA related processes as expressed by various participants. Improving the information exchange and streamlining the NSA related processes are welcome efforts for the air ambulance community. However, there are still several areas where the Departments are working on language that may critically impact how the rule will be implemented. Until we see and understand that additional language, the jury is still out on the effectiveness of this new operations rule. 

Likewise, nothing in this rule addresses several additional areas of concern that have been consistently voiced by the air ambulance community: 

• Cooling Off Period Confusion 

The application of the Cooling Off Period provisions of the NSA continues to create delays in the IDR process for air ambulance providers. Air ambulance providers typically use two (2) codes (for each claim). The Cooling Off Period effectively shuts down the IDR process for ALL claims with a specific provider and payor for the specified period. This penalizes air ambulance providers unnecessarily. The intent of the cooling off period was to allow for active dialogue between parties regarding in network relationships. Behavior by the payors since the inception of the NSA has proven this concept has failed. 

• Initial Payment Challenges

With the length of time the NSA related processes take and the lack of guidelines for initial payments, providers are penalized when payors issue initial payments well below what is reasonable. Payors are increasingly paying a small percentage of the claim value (or not paying at all) at the time of initial claim determination. This is forcing providers to wait months or years for compensation for the valuable services they provide. 

• Payment Enforcement 

Air ambulance providers are still waiting months or years to receive final payment from health plans after a successful IDR adjudication. The original NSA regulations provide a very specific timeline; however, those regulations were silent on enforcement. This provides no incentive for payors to make final remittance on a timely basis. 

These updates are positive steps to alleviate stress in the system. Until the final language for this rule is published AND implemented, the extent of the relief will be unclear.   Additional efforts to resolve the additional key issues noted above must continue. The lack of resolution will continue to put access to air ambulance at risk across the country. The vital role air ambulance providers play is increasingly important with the number of rural hospital closures resulting from the other pressures on the health care delivery system. 

The Digitech team will continue to monitor the processes and advocate for positive change. 

 

From the operational challenges associated with a global pandemic, to staffing difficulties, to ongoing reimbursement shortfalls, it seems as if the Prehospital Care Community in the United States has been under siege for years. And now, as the budget reconciliation process continues in Washington and the Federal Government recalibrates in the post-DOGE era, there are both risks and opportunities for healthcare providers and suppliers.  

Headwinds Ahead

In an ever-shifting landscape, uncertainty has become the norm. Here are some of the challenges that lie before the pre-hospital care community:

Cost Pressures

The cost pressure is no surprise to anyone who follows our industry. However, what does the future hold on this front? It stands to reason that labor costs will continue to rise as certain members of our teams catch up from historically low wages. Shortages of key professionals are expected to continue and, in some cases, accelerate in the years ahead. In addition, the cost of equipment, supplies and technology continues to rise at alarming rates—if you can even get the medications and/or ambulances to put them in.

Government Budget Challenges

As the saga of the Federal budget process plays out in our nation’s capital, we should note there are challenges in State and Local municipal budgets as well. The projected cuts in Federal spending are destined to impact Medicaid, Medicare, and many other healthcare programs. To compound the issue, many State and Local agencies are seeing federal dollars that they relied on for other key programs to cut. Likewise, changes in funding for education are likely to impact the institutions that offer the majority of the training required to develop new EMTs, Paramedics, and Nurses.

Balanced Billing Challenges

The EMS community is entering an era of uncertainty as States continue to address the impact of balance bills to patients. Those of you in the air medical services portion of our community are several years into what we know as the No Surprises Act (NSA). While many states are taking a slightly different approach to addressing this issue on the ground side, the reality remains the same, and our ability to cost shift (make up the shortfall from inadequate government payments, uncompensated and undercompensated care) will be significantly diminished.

Tariffs

While we are still relatively early in the “tariff era,” economists believe the near-term impact will be higher prices for many goods used in healthcare delivery. Some remain hopeful there will be a more positive long-term impact as domestic production of many of these items ramps up. Only time will tell, but it seems logical to assume the current tariff related cost pressures will evolve into significant cost increases for healthcare supplies for the next 1-4 years.

VA Reimbursement Cuts

The stay of execution on VA payment cuts was issued last year. It was a huge relief for agencies that operate in areas with large Veteran populations. However, there is still a need for VA leadership to address the findings of the Government Accountability Office (GAO) study and develop a more balanced payment mechanism for medical transport services to avoid reduced payments from the VA.

Opportunity on the Horizon

At the same time, there are doors that can open even in times of uncertainty. Here are some of the opportunities that may present to the pre-hospital care community:

Market Rationalization

Our organizations operate with very high fixed costs (what we call readiness costs). This means that the ultimate performance metric, cost per transport, is tied tightly to the volume of episodes of care we provide. As economics become more challenging, there are often reductions in the number of suppliers. That reduction creates an opportunity for the remaining organizations to reduce their cost per transport by increasing volumes and getting economies of scale. Of course, expansion of services and/or service areas must be carefully evaluated and implemented.

Medicare Payment Reform

Compiled data from the Ground Ambulance Data Collection System (GADCS) shows that there will now be relatively objective data on the operation of prehospital care organizations. Likewise, the NSA prescribes a similar data collection process for air ambulance service. The air ambulance process should commence with the publication of the final NSA rule. The industry is hopeful this data may be applied to a comprehensive effort to reform the current Medicare payment system. Anyone who has been around the EMS community for more than a few years understands that Medicare reimbursement is less than adequate. For the first time in many years, we may actually have the data to support a rational calibration of the Medicare Ambulance Fee Schedule.

Readiness Movement

In many areas of the country, community leaders have come to grips with the concept of readiness costs. Some communities are making efforts to compensate prehospital care organizations accordingly. While a great deal of work is left to be done in this area, there are certainly models to build upon. This is an area that has the potential to change the economic landscape of EMS in many portions of the country.

VA Payment Reform

While there is still risk the reimbursement payment system will result in dramatic reductions in payment for prehospital care providers, there is also an opportunity for the emergence of a rational system of compensation for the prehospital care of VA patients. EMS leaders need to continue to track this matter and pursue policy change that is balanced and rational.

There is Hope…

As you weigh these many factors that will impact prehospital economics in your own organization and in the years ahead, recognize there is hope and opportunity. There is more movement toward true financial reform than we have encountered in recent years. More data is now available to us. There appear to be emerging champions for EMS payment and financing reform. The industry seems to be more engaged and united in its commitment to achieve rational reforms.

While headwinds are inevitable—and EMS leaders must and prepare their organizations for the storm—we must never lose focus on the opportunities that lay before us.