HHS Finalizes Long-Awaited No Surprises Act Rule Overhauling Federal IDR Process, by Abbye Alexander, Esq. and Henry Norwood, Esq., 6-4-2026

The U.S. Departments of Health and Human Services (HHS), Labor, and Treasury, together with the Office of Personnel Management, have issued a final rule implementing significant operational changes to the Federal Independent Dispute Resolution (IDR) process established under the No Surprises Act (NSA). The rule is intended to improve the functioning of the Federal IDR process by streamlining communication among payers, providers, and certified IDR entities and by clarifying timelines and procedures.

The final rule follows implementation challenges and stakeholder concerns regarding the efficiency of the Federal IDR process. CMS states that the rule is designed to reduce administrative burden, improve transparency, and make the process more accessible when parties cannot resolve out-of-network payment disputes through open negotiation.

Key Changes

Reduced Administrative Fee

One of the most notable changes is a substantial reduction in the administrative fee required to participate in the Federal IDR process. The fee will decrease from $115 to $15 per party per dispute.

Enhanced Communication Requirements

The rule requires payers to use specific claim adjustment reason codes (CARCs) and remittance advice remark codes (RARCs) when providing paper or electronic remittance advice to entities that do not have a contractual relationship with the payer. These codes are intended to help providers determine whether a claim may be eligible for the Federal IDR process and whether the NSA’s protections apply, which CMS says should reduce the submission of ineligible disputes.

The rule also requires payers to provide additional identifying information with an initial payment or notice of denial of payment, including the legal business name of the plan, issuer, or carrier, the legal business name of the self-insured plan sponsor where applicable, and the registration number described in the IDR Registry provisions. In addition, payers must include a statement explaining that providers must notify the Departments through the Federal IDR portal to initiate open negotiation.

New Open Negotiation Procedures

The NSA requires a 30-business-day open negotiation period before the Federal IDR process may be used. Under the final rule, a party must provide an open negotiation notice to the other party and the Departments through the Federal IDR portal to initiate that period, and the notice must contain additional required content elements intended to help identify the item or service and assess whether the Federal IDR process applies.

The rule also establishes an open negotiation response notice, which must be furnished by the recipient of the open negotiation notice to the other party and the Departments by the fifteenth business day of the open negotiation period. CMS says these changes are intended to create more certainty regarding whether and when open negotiation occurs and to reduce the number of ineligible disputes.

Expanded Batching Flexibility

The final rule expands the circumstances in which qualified IDR items and services may be batched into a single dispute. As finalized, batching may occur for items and services furnished to a single patient on the same or consecutive dates of service and billed on the same claim form, for certain items and services billed under the same or comparable service codes, and for certain anesthesiology, radiology, pathology, and laboratory services grouped within the same Category I CPT code section as specified in guidance.

The rule also imposes a limit of 50 qualified IDR items and services, or line items, in a single batched dispute.

Eligibility Review and Registry

The rule establishes new timelines for certified IDR entities to conduct eligibility reviews. Certified IDR entities must determine eligibility within 5 business days of final certified IDR entity selection and notify the disputing parties and the Departments. The rule also requires parties to submit additional information within 5 business days when requested by the certified IDR entity. Failure to provide the requested information may result in the dispute proceeding without that information or being closed if the certified IDR entity cannot continue its review.

The rule also establishes an IDR Registry requiring payers subject to the Federal IDR process to register with the Departments and obtain an IDR registration number. CMS says the registry is intended to make it easier to identify the correct payer, distinguish between types of coverage, and assist both enforcement and eligibility determinations.

Employer and Health Plan Considerations

Although the final rule is primarily operational, employer-sponsored group health plans, particularly self-funded plans, should review whether current administrator and payer workflows align with the new requirements. Plan sponsors and administrators may wish to coordinate with vendors and third-party administrators on required disclosures, portal-related workflows, registry obligations, and dispute-response timing.

Self-funded group health plans should also review service agreements with third-party administrators to determine which party will be responsible for satisfying applicable registry, disclosure, and dispute-management obligations.

Authors: Abbye Alexander, Chair of the Health Care/Managed Care Practice Group and Of Counsel Henry Norwood