What employers, group health plan fiduciaries and administrators must know and do about the No Surprises Act and proposed legislation to replace it.

Health plan employer and other sponsors, fiduciaries, administrators and insurers concerned about costs and administrative burdens of complying with the No Surprises Act (“NSA”) should evaluate and consider contacting Congress about potential legislative reforms like those proposed in H.R. 10788, the “Lower Premiums, Faster Payments Act” introduced October 9, 2026, by Representative Frank Pallone Jr. (D-NJ). Pending the enactment of further legislative or other regulatory relief, however, all health plan fiduciaries and sponsors should act quickly to evaluate their plan’s current NSA compliance, current and past cost and liability exposure from potentially inadequate compliance and verify health plan vendors responsible for this compliance are functionally prepared and contractually accountable to maintain this compliance going forward. Quick action to confirm and maintain current compliance is particularly critical because since HR 10788 is merely proposed legislation, not enacted law, health plans and their fiduciaries, administrators, and insurers face significant additional costs and liability if their health plan processes don’t comply with applicable NSA requirements, including recent regulatory changes already effective and others slated to take effect in upcoming months under guidance published in May and June.

Introduced as a potential solution to the growing concerns of employer and other health plan sponsors, health insurers and their fiduciaries and administrators to the costs and administrative burdens health plan and insurers are grappling with under the NSA’s current mandatory independent dispute resolution (“IDR”) process for determining how much health plans must pay out-of-network health care providers for emergency and certain other care, H.R. 10788 proposes to replace the current NSA IDR mechanism for applicable services furnished after December 31, 2027.)

Why this proposal matters to employer-sponsored health plans

The NSA protects patients from certain surprise out-of-network bills while regulating how group health plans and insurers determine cost-sharing and reimburse nonparticipating providers. The current system allows qualifying payment disputes to proceed through open negotiation and, where eligible, federal IDR. Supporters of H.R. 10788 believe this dispute mechanism has generated excessive costs and delays; physician organizations warn that abolishing independent arbitration may shift pricing leverage toward insurers and harm access or contracting. See, e.g., Pallone, announcement of the Lower Premiums, Faster Payments Act (Oct. 8, 2026); For provider concerns, see: American College of Emergency Physicians, joint physician organizations statement (Oct. 8, 2026).

H.R. 10788 Proposes Five Major Changes

1. Current NSA Federal IDR would end for applicable services furnished in 2028 and later

The bill would terminate the federal IDR mechanism for services furnished on or after January 1, 2028, including the parallel federal air-ambulance IDR provisions. The current law would continue to govern services furnished before that date. For claims to which the federal default out-of-network rate applies, the revised QPA would replace an IDR-set rate. Applicable all-payer model agreements, specified state laws and other statutory exceptions remain important; the proposal is not a universal QPA rate for every claim. See, H.R. 10788, § 2(a)(1), (b)(1), (c)(1).

2. The QPA formula would become plan-specific and use a revised 2019 baseline

For services furnished during 2028, H.R. 10788 generally would use the median contracted rates recognized by the particular plan or coverage as of January 31, 2019, adjusted for specified inflation through 2027. The proposed median incorporates patient cost-sharing, plan payments and expected incentive-based or retrospective adjustments, including bonuses, penalties and risk-sharing arrangements. It excludes certain rates from providers who did not furnish the service during the relevant 2019 plan year. Later years would generally receive CPI-U adjustments, with alternate methods for newer plans or insufficient data. See H.R. 10788, § 2(a)(2)(A), (b)(2)(A), (c)(2)(A).

For self-funded plans this increases the importance of knowing the underlying rates, which contracts count, whether the administrator is applying the plan-specific approach, and how rented networks or alternative-pricing arrangements interact with the formula.

3. A proposed 30-day payment deadline would run from the provider’s transmitted bill

For services whose applicable out-of-network rate is the QPA, the legislation proposes payment within 30 days after the provider or facility transmits its bill. H.R. 10788, § 2(a)(1)(A), (b)(1)(A), (c)(1)(A).

This differs from current rules requiring an initial payment or notice of denial generally within 30 calendar days after receipt of a clean claim and subsequent payment of additional payment obligations within 30 days of the end of the IDR process. The proposal raises operational questions about incomplete bills, receipt verification, coding disputes and coordination with claims adjudication rules. Consequently, it remains unclear whether the proposed solution in its currently proposed form would in fact streamline administrative and other costs and burdens.

4. Annual QPA audits and public findings would expand

For 2028 and later years, the proposal would mandate annual auditing of claims data from a sample of not fewer than 25 plans and insurers, and would require public availability of audit findings. Increased visibility could expose deficient rates, data practices and administration controls. H.R. 10788, § 2(a)(2)(C), (b)(2)(C), (c)(2)(C). This additional audit and reporting obligation almost certainly would fuel both additional contracting and oversight obligations and corresponding costs and administrative burdens for health plans and insurers, their sponsors and fiduciaries.

5. New rules would be due within 180 days of enactment

The bill directs federal rulemaking on the revised QPA methodology within 180 days after enactment, permits interim final rules and includes language limiting judicial review of the QPA methodology. H.R. 10788, § 2(a)(2)(B), (b)(2)(B), (c)(2)(B).

The scope and effect of that limitation would require attention if the bill advances.

Current NSA duties remain fully in force

Pending any actual statutory change, employers, issuers and administrators must continue applying NSA balance-billing and cost-sharing protections for covered emergency, certain nonemergency and air-ambulance services; implementing proper QPA calculations and disclosures; making timely initial payments or denials; conducting required open negotiation; complying with the federal IDR process where applicable; and paying required final amounts on time. See ERISA § 716, 29 U.S.C. § 1185e; 42 U.S.C. § 300gg-111; and: 26 U.S.C. § 9816.

The 2026 IDR final rule is not optional

ERISA and other covered health plans and insurance have been required to comply with the NSA IDR process for resolving disputes about the amount health plans must pay for covered out-of-network care for two years. Beyond past costs and liabilities health plans already have incurred for insufficient processes, going forward group health plans also must contend with enhanced plan registration requirements, expected surges in IDR filing expected in response to the reduction of the required filing fee to $15, payer/provider communications, QPA information disclosures and phased requirements imposed by Federal IDR operations final rules released May 28 and published in June 2026. The administrative fee is $15 per party per dispute for disputes initiated on or after June 11, 2026. Beginning November 1, 2026, certain batching provisions and web-form validations apply to disputes whose open negotiation periods begin on or after that date. Some standardized claims-adjustment and remittance-code requirements apply beginning January 1, 2027. See Federal IDR Operations Final Rule fact sheet (May 28, 2026); CMS final-rule implementation timeline; CMS NSA notices and October 2, 2026 batching update.

Fiduciary, contractual and financial consequences

Compliance with the NSA mandates not only is obligatory under ERISA for self-funded plans, reimbursement practices influence assets used to pay claims. Responsible fiduciaries generally must prudently select and monitor service providers to the extent applicable under ERISA. Employers or others selecting the TPA or other parties responsible for performing administrative or other plan responsibilities generally bear fiduciary responsibility for prudently selecting and overseeing the performance of those appointed to perform these responsibilities. Employers that fail to specifically contract for their TPA or another party to serve as a fiduciary with respect to these or other administrative functions often don’t realize that this omission leaves them or the human resources or other personnel named as the fiduciary in contracts, plan documents and summary plan descriptions to fiduciary liability for services outsourced to a TPA or other plan vendor. Meanwhile, a TPA is not automatically an ERISA fiduciary merely for performing ministerial functions, but functional fiduciary status may arise when it exercises qualifying discretion or control. Employers should not assume that outsourcing claims pricing eliminates all oversight responsibilities. See, 29 U.S.C. §§ 1002(21), 1104–1105.

Beyond this legal exposure, plan sponsors and fiduciaries of health plans using reference-based pricing, narrow networks or rented networks also should especially scrutinize how NSA-covered services are identified, processed and paid. Any proposed QPA transition may require revision of plan terms, SPD descriptions, administration contracts, provider-advocacy arrangements and payment controls as a plan reimbursement formula cannot simply supersede statutory protections for claims governed by the NSA. Equally critical is clearly understanding the likely effect of the NSA requirements on plan costs and associated budgets. Government data confirms claims processed through the IDR system typically far exceed projections used to project these costs in pre-plan year estimates provided to most group health plans. Employers and plan fiduciaries that fail to take into account these changes and ensure plan processes and budgets are modified accordingly set their health plans and themselves significantly higher costs and potential penalties and other liabilities.

Recommended employer and fiduciary actions now!

Group health plan sponsors and employers need to move quickly and effectively to respond to current and past exposures and responsibilities under the NSA to ensure compliance and effectively mitigate its financial and legal risks. Among other steps, employers and plan fiduciaries should seek the assistance of qualified legal counsel to guide and assist them to evaluate and manage their NSA and related responsibilities and costs, including but not limited to:

• Engage qualified legal counsel to advise and guide the design and conduct of an existing and retrospective gap analysis of your health plan’s compliance, potential fiduciary-breach exposure, vendor indemnification rights, and recovery options where the audit reveals material vendor deficiencies.
• Prudently investigate the adequacy of their health plan design, documentation, communications, notifications, and administrative process are ready to reliably comply with current and impending NSA protections, IDR procedures and the 2026 final-rule schedule independently and in conjunction with ERISA, ACA and other claims and appeals, transparency, fiduciary responsibility and other federal mandates.
• Commission a 2026 NSA compliance audit covering negotiation timeliness, IDR response completeness and timeliness, QPA calculation methodology, notice content, and payment timing.
• Reconcile actual 2026 OON claim costs (including administrative fees and IDR awards) against the assumptions used for the 2026 budget and 2027 renewal, and require material variances to be explained.
• Request a full 2026 IDR dispute log from your TPA/ASO vendor — disputes initiated, eligibility challenges raised, defaults, timeliness of responses, and outcomes relative to QPA — to identify systemic administration issues.
• Benchmark your plan’s or vendor’s QPA/reference-based-pricing methodology against actual contracted-rate and IDR outcome data, and challenge assumptions that do not reasonably account for NSA experience.
• Obtain and assess plan-level reporting of out-of-network claims, IDR volume, awards, fees and settlements retrospectively for the past two years and provide for ongoing reporting on a monthly basis prospectively.
• Review stop-loss and reinsurance contracts for claim-filing deadlines and proper-administration conditions, and confirm your TPA is meeting them for NSA-related claims.
• Document the audit, findings, and any corrective action plan in fiduciary committee minutes as part of the plan’s ongoing prudent-process record.
• Review existing plan year out-of-network claims to verify compliance, identify potential NSA cost or liability exposures, identify and take advantage of opportunities to mitigate risks through timely intervention, and verify timely processing, payment and submission to avoid unnecessary costs and liability and preserve and maximize stop loss and other reinsurance coverage.
• Require TPAs, ASO vendors and leased networks to explain and document their QPA data sources and calculations and prudently evaluate the adequacy and reliability of these processes.
• Review stop-loss and reinsurance contracts for past, current and future claim-filing deadlines and proper-administration conditions and confirm your TPA is meeting them for NSA-related and other claims and has the necessary processes to prudently expect it to continue to do so going forward.
• Verify and contractually document arrangements for required NSA registration of the health plan with the responsible TPA or other vendor and obtain and retain verification of timely fulfillment of these obligations.
• Review and revise contracts and other documents to ensure adequate fiduciary appointments, data-access rights, independent audit rights, indemnities, compensation structures, and claims-error allocations and accountability.
• Identify service-date transition and programming risks if a January 2028 reimbursement change is enacted.
• Analyze existing plan design potential plan cost savings projections alongside network-access, provider contracting and litigation risks.
• Document fiduciary oversight and monitor bill amendments without postponing current compliance.
• Prudently audit their plan’s past compliance to identify past and current cost and liability exposures from existing or past NSA-covered claims handled sub-optimally under the NSA to determine any remaining options to mitigate those liabilities and determine whether their fiduciary obligations make it prudent for the fiduciaries to pursue redress against existing or past vendors or fiduciaries for these deficiencies.
• Critically evaluate existing and proposed plan designs to evaluate the adequacy and reliability of their cost and compliance models and take corrective action as warranted.
• Modify plan design, documentation, notices and communications, and other processes to maintain compliance and mitigate risks and costs.
• Establish documented, prudent processes to monitor and enforce changing requirements and ongoing compliance on an ongoing basis.
• Document the audit, findings, and any corrective action plan in fiduciary committee minutes as part of the plan’s ongoing prudent-process record.
• Engage counsel to assess potential fiduciary-breach exposure, vendor indemnification rights, and recovery options where the audit reveals material vendor deficiencies.
• Seek the assistance of experienced legal counsel to document efforts and findings to promote defensibility of compliance and fiduciary performance.
• More

The proposed Lower Premiums, Faster Payments Act could change federal out-of-network pricing as significantly as the NSA changed patient balance-billing protections. Yet it provides no present excuse for employer or other health plans or their fiduciaries or insurers to defer existing claims, payment, IDR or disclosure duties. Consequently, while employers and plan fiduciaries should consider evaluating and sharing their input with Congress about these or other potential reforms to the NSA or other federal health plan rules, the current federal rules make it imperative that employers and health plan fiduciaries take immediate steps to ensure their health plans and their administrators are contractually accountable for and can and do administer their health plans in accordance with the NSA and other federal claims, transparency, and other requirements now regardless of whether H.R. 10788 or other federal legislative reforms become law in the future.

For Help or More Information

The author of this update, Cynthia Marcotte Stamer has decades of experience advising and representing health and other employee benefit plans, their employer and other sponsors, fiduciaries, administrators, insurers and others on these and other laws and operations.

Her experience includes extensive work helping these and other clients design, audit, and defend their organizations and practices including conducting NSA and other audits and investigations, designing and updating compliance and risk management programs, responding to government investigations, conducting transaction, governance, and other due diligence, and assisting with other legal and operational compliance and risk management and legislative and regulatory affairs. She is available to assist your organization in assessing the impact of these developments and navigating the compliance and strategic steps that follow.

Well-known for her knowledge, training and publications on health and other employee benefits and workforce matters, Ms. Stamer also is nationally recognized for her extensive publications, training and advocacy on health and other employee benefits matters, including:

• A recorded briefing on “Winning The War On Out-Of-Network Claims: Updating Your Battle Plan For Avoiding No Surprises Act & Other Out-Of-Network Claims Compliance, Cost Control & Claims Management Minefield” she recently conducted with The OccuNet Company Chief Production Officer Carol Lockwood for the Fort Worth HR Compensation and Employee Benefits PEG on October 7, 2026;
• Her upcoming virtual program on “Road Ready Your Health Plan For 2027 With A Health Plan Wellness Checkup” that Ms. Stamer is scheduled to present on October 4, 2026; and
• Many other Solutions Law Press and other presentations and programs.

For more information about securing a copy of the recording, attending the upcoming or other briefings, or other health or other employee benefits, workforce, health care or other training, resources, or services, see http://www.solutionslawyer.com orcontact Ms. Stamer via e-mail or via telephone at (214) 452 -8297.

About the Author

Cynthia Marcotte Stamer is an American College of Employee Benefits Counsel and a Martindale-Hubble “AV-Preeminent” (Top 1%) attorney and advisor board certified in labor and employment law by the Texas Board of Legal Specialization peer peer celebrated as “Top Rated Lawyer” and “LEGAL LEADER™ “Top Rated Lawyer” and “Best Lawyer” for her work in ERISA & Employee Benefits Law, Health Care Law, Labor and Employment Law, and Business and Commercial Law.

Nationally recognised for her decades of leading edge health and other employee benefits and insurance, compensation, human resources and other management work, public policy leadership and advocacy, coaching, teachings, and publications, Ms. Stamer is well known for her decades of pragmatic, leading edge work, scholarship and thought leadership on health benefit and other health and managed care, privacy and data security and other employee benefit, insurance, and health industry legal, public policy and operational concerns. 

Ms. Stamer’s work throughout her career has focused heavily on working with health care and managed care, health and other employee benefit plan, insurance and financial services and other public and private organizations and their technology, data, and other service providers and advisors domestically and internationally with legal and operational compliance and risk management, performance and workforce management, regulatory and public policy and other legal and operational concerns.  As a a key focus of this work, she has continuously and extensively worked with domestic and international health plans, their sponsors, fiduciaries, administrators, and insurers; managed care and insurance organizations; third party administrators and other health benefit service providers; hospitals, health care systems and other health care providers, accreditation, peer review and quality committees and organizations; billing, utilization management, management services organizations, group purchasing organizations; pharmaceutical, pharmacy, and prescription benefit management and organizations; consultants; investors; EMR, claims, payroll and other technology, billing and reimbursement and other services and product vendors; products and solutions consultants and developers; investors; managed care organizations, self-insured health and other employee benefit plans, their sponsors, fiduciaries, administrators and service providers, insurers and other payers, health industry advocacy and other service providers and groups and other health and managed care industry clients as well as federal and state legislative, regulatory, investigatory and enforcement bodies and agencies.

Her experience includes more than 35 years of leading edge work for employer and other plan sponsors, plans and their fiduciaries, insurers, third party administrators, health care clearinghouses and other health care, insurance and other data and technology providers, and others on health and other employee benefits design, administration, compliance, and policy including decades of work on fiduciary compliance and risk management; eligibility, coverage and other plan mandates; administrative simplification and transparency; PBM, pharmacy and pharmaceutical management and regulation; surprise billing and other non-par provider; direct provider, vendor and other credentialing, contracting and management; and other managed care and insurance; high deductible, minimum or level premium, captive and other non traditional funding; and agency and private audits, investigations and enforcement; and other insured and self-insured health benefit contracting, design, administration, regulation, fiduciary and other liability managment, and other design, compliance, risk management, defense, and operations solutions.

She also has extensive experience helping health care systems and organizations, group and individual health care providers, health plans and insurers, health IT, life sciences and other health industry clients prevent, investigate, manage and resolve  sexual assault, abuse, harassment and other organizational, provider and employee misconduct and other performance and behavior; manage Section 1557, Section 504, Civil Rights Act and other discrimination and accommodation, and other regulatory, contractual and other compliance; vendors and suppliers; contracting and other terms of participation, medical billing, reimbursement, claims administration and coordination, Medicare, Medicaid, CHIP, Medicare/Medicaid Advantage, ERISA and other payers and other provider-payer relations, contracting, compliance and enforcement; Form 990 and other nonprofit and tax-exemption; fundraising, investors, joint venture, and other business partners; quality and other performance measurement, management, discipline and reporting; physician and other workforce recruiting, performance management, peer review and other investigations and discipline, wage and hour, payroll, gain-sharing and other pay-for performance and other compensation, training, outsourcing and other human resources and workforce matters; board, medical staff and other governance; strategic planning, process and quality improvement; meaningful use, EMR, HIPAA and other technology,  data security and breach and other health IT and data; STARK, ant kickback, insurance, and other fraud prevention, investigation, defense and enforcement; audits, investigations, and enforcement actions; trade secrets and other intellectual property; crisis preparedness and response; internal, government and third-party licensure, credentialing, accreditation, HCQIA and other peer review and quality reporting, audits, investigations, enforcement and defense; patient relations and care;  internal controls and regulatory compliance; payer-provider, provider-provider, vendor, patient, governmental and community relations; facilities, practice, products and other sales, mergers, acquisitions and other business and commercial transactions; government procurement and contracting; grants; tax-exemption and not-for-profit; privacy and data security; training; risk and change management; regulatory affairs and public policy; process, product and service improvement, development and innovation, and other legal and operational compliance and risk management, government and regulatory affairs and operations concerns. to establish, administer and defend workforce and staffing, quality, and other compliance, risk management and operational practices, policies and actions; comply with requirements; investigate and respond to Department of Insurance, Board of Medicine, Health, Nursing, Pharmacy, Chiropractic, trucking, alcohol and firearm, and other licensing agencies, Department of Aging & Disability, FDA, Drug Enforcement Agency, OCR Privacy and Civil Rights, Department of Labor, IRS, HHS, DOD, FTC, SEC, CDC and other public health, Department of Justice and state attorneys’ general and other federal and state agencies; JCHO and other accreditation and quality organizations; private litigation and other federal and state health care industry actions: regulatory and public policy advocacy; training and discipline; enforcement;  and other strategic and operational concerns.

Former lead advisor to the Government of Bolivia on its Social Security Privatization reform, miss Stamer also has extensive legislative and regulatory affairs experience on federal, state and international employee benefits, healthcare, workforce, education, insurance, data privacy and security, antitrust, and other regulations and reforms.

In addition, Ms. Stamer contributes her time and leadership to numerous policy, professional, civil and other organizations, Ms. Stamer currently or previously served as the Scribe leading annual agency meetings on HIPAA and other issues with the Department of Health and Human Services; leadership Council Representative, speaker, author and faculty lead for the American Bar Association (“ABA”) Joint Committee on Employee Benefits; the ABA International Section International Employment Law Committee and International Life Sciences Committee Chair; the ABA Tort Trial and Insurance Practice Section Medicine and Law Committee Chair and Employee Benefits and Worker’s Compensation Committees Vice Chair; the ABA Health Law Section Managed Care & Insurance Interest Group Chair and Risk Management Interest Group Chair; the ABA RPTE Employee Benefits & Other Compensation Group Chair and Welfare Benefit, Fiduciary Responsibility, and Plan Terminations and Transactions Committees Chair; Vice President and Executive Director of the North Texas Health Care Compliance Professionals Association; a Southwest Benefits Association Board Member; a SHRM Consultants National and Region IV Board Chair; WEB National Board Member and Dallas Chapter President; National Kidney Foundation of North Texas Board Member and Compliance Chair; Richardson Development Center (now Warren Center) for Children Early Childhood Intervention Agency Board President; a North Texas United Way Long Range Planning Committee Member; and other leadership involvement in a broad range of other professional and civic organizations.

Author of hundreds of highly regarded works on health and other benefits, human resources, health care, insurance, data privacy and security and other related concerns, examples of these publications include “Transparent PBM Contracting,” “ACOs, Direct Contracting: Legal & Practical Challenges For Employers, Providers & TPAs,” “The Medicare Advantage Contracting Manual,” “Third Party Administrator (TPA) Contracting Principles and Strategies and a multitude of other publications and presentations. 

For more information about Ms. Stamer or her health industry and other experience and involvements, see www.cynthiastamer.com or contact Ms. Stamer via telephone at (214) 452-8297 or via e-mail here.

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