What is No Surprises Act 2023 for US Healthcare Providers?

For medical practices, health systems, and specialty providers across the United States, 2023 marked the year that the foundational framework of surprise billing protection legislation truly solidified.

While the No Surprises Act (NSA) initially took effect on January 1, 2022, the subsequent issuance of regulatory clarifications, particularly the third Final Rule by the Departments of Health and Human Services (HHS), Labor, and the Treasury, drastically recalibrated the financial playing field.

The core mission of the NSA remains to shield patients from unexpected “balance bills” for certain out-of-network (OON) emergency care, as well as non-emergency services provided by OON providers at in-network facilities.

However, the regulatory actions in late 2022 and early 2023 stemming largely from legal challenges mandated significant adjustments to the core mechanism used to resolve billing disputes: the Federal Independent Dispute Resolution (IDR) process.

In this detailed guide, we will explore how the Final Rule impacts revenue cycle management (RCM), physician credentialing, and coding practices, ensuring your organization is positioned for optimal financial health.

Successfully navigating the requirements of the no surprises act 2023 necessitates deep operational expertise, which we will provide here.

The Critical Recalibration of the Independent Dispute Resolution (IDR) Process

The single most consequential change defining the no surprises act 2023 environment involves the federal IDR process, which dictates how payers (insurers) and providers agree upon the final payment amount for an OON service.

The Demise of the QPA Presumption

The original Interim Final Rule (IFR) was highly contentious because it effectively treated the Qualifying Payment Amount (QPA), which is generally the payer’s median in-network contracted rate as the presumptive payment amount.

Independent dispute resolution entities were instructed to select the offer closest to the QPA unless clear, credible information demonstrated that the QPA was materially inappropriate.

The legal and regulatory adjustments implemented in the No Surprises Act 2023 officially removed this presumption. The Final Rule now mandates that IDR entities must give equal consideration to the QPA and all other permissible information submitted by the parties.

This shift is monumental. It moves the IDR process from a QPA-centric model to a true “baseball-style” arbitration model, where the decision-maker must select the offer that best represents the true value of the service.

For providers, this means their offers, if supported by robust and compelling data, now stand a far greater chance of being selected over an insurer’s QPA-driven offer.

The Permissible Factors in IDR Determinations

To fully leverage the opportunities under the No Surprises Act 2023, providers must understand the five permissible additional factors that the IDR entity must now consider when determining the OON rate, provided the information is credible and not already accounted for in the QPA:

1. Patient Acuity and Complexity: The IDR entity must consider the patient’s medical condition and the complexity of the service performed. For instance, a complex surgical procedure performed on a patient with multiple comorbidities may justify a payment higher than the standard QPA for that service. Coding and clinical documentation must clearly support this argument.
2. Provider/Facility Teaching Status, Case Mix, and Scope of Services: Factors such as whether a facility is a teaching hospital or offers unique, high-level services are now explicitly allowed as arguments for a higher reimbursement rate. This acknowledges the inherent cost differences in providing highly specialized care.
3. Market Share of the Non-Initiating Party: Evidence of dominant market share or anti-competitive behavior by the payer is now permissible. This is a crucial check against payers who may use their market power to drive down QPA rates unfairly.
4. Demonstrations of Good Faith Efforts: The IDR entity may consider documentation of attempts by both parties to enter into network agreements or previous contract negotiation rates that fell through.
5. Quality and Outcomes: Evidence demonstrating higher quality of care (e.g., lower readmission rates, superior patient outcomes) for the specific service provided, as compared to other providers, can be a compelling argument for a higher rate.

Expert Insight: For medical billing specialists, the shift in the No Surprises Act 2023 requires moving beyond simple clean claim submission. You must now focus on data preparation for potential IDR. This includes meticulously compiling evidence related to case complexity, quality metrics, and, critically, ensuring the provided documentation (e.g., operative reports, physician notes) supports the narrative for higher payment.

You can also read our detailed guides on:

Pediatric Medical Billing for Pediatricians | Complete Guide 2025
How to Streamline Endocrinology Billing & Maximize Collections?
Mastering Ob/gyn Billing and Coding | Guide to Compliant RCM
What is Ophthalmology Billing & Coding? CPT, ICD-10, Tips & Rules

Operational and Financial Impacts of the No Surprises Act 2023

The legislative framework introduced in 2022 and refined in the No Surprises Act 2023 has ripple effects across the entire revenue cycle. Two areas saw immediate, measurable changes: the IDR administrative fee and negotiation timelines.

The IDR Administrative Fee Hike (Effective January 1, 2023)

Responding directly to an unprecedented volume of IDR submissions and a significant backlog, the Centers for Medicare & Medicaid Services (CMS) amended the IDR fee guidance.

Effective January 1, 2023, the administrative fee paid by the losing party (or split if both submit an offer) for the federal IDR process saw a massive increase from $50 per party to $350 per party.

Change	Pre-2023 IDR Fee	No Surprises Act 2023 IDR Fee (Jan 1, 2023)
Administrative Fee (Per Party)	$50	$350

This sevenfold increase is a powerful disincentive for submitting low-value or questionable disputes. It forces both providers and payers to engage in more meaningful open negotiations before proceeding to the expensive IDR phase.

RCM Strategy: This fee increase makes a clear RCM strategy essential. Practices must be highly selective about which disputes they pursue to IDR. The potential cost of losing a $350 fee now requires a more rigorous cost-benefit analysis before initiating the IDR process under the No Surprises Act 2023.

Payment, Negotiation, and Certification Timelines

The rules governing the negotiation period remained critical in the No Surprises Act 2023:

1. Initial Payment/Denial Trigger: The payer must provide an initial payment or a notice of denial within 30 calendar days of the provider submitting the claim.
2. Open Negotiation Window: Once the provider receives the initial payment or denial, a 30-business-day window for open negotiation begins. During this time, the provider and payer attempt to reach a settlement outside of the IDR process.
3. IDR Initiation: If the negotiation fails to resolve the payment within the 30-business-day window, either party has four business days to notify the other party and the relevant departments of their intent to initiate the IDR process. The IDR portal submission must be completed within four business days after the initiation notice.

Expert Insight: The strict, overlapping deadlines defined by the No Surprises Act 2023 necessitate real-time claim tracking and automated alert systems in the medical billing department. Missing the tight negotiation window due to administrative delay can jeopardize your ability to recover fair reimbursement.

Mandatory Provider Responsibilities: Good Faith Estimates (GFE)

The most significant compliance burden placed directly on providers by the No Surprises Act 2023 remains the requirement for providing a Good Faith Estimate (GFE) to uninsured or self-pay individuals, and potentially to insured patients under certain circumstances. This requirement is non-negotiable and represents a shift toward radical price transparency.

GFE for Uninsured/Self-Pay Patients

Providers must give a GFE of the total expected charges for scheduled or requested items or services, including those reasonably expected to be provided with the primary service.

• Timing: The GFE must be provided within specific timeframes based on the scheduling date (e.g., within 3 business days of scheduling if the service is scheduled 10 business days out).
• Content: The GFE must be comprehensive, listing the diagnosis code, expected service codes (CPT/HCPCS), expected charges, and tax identification numbers for the facility and provider.

The Co-Provider/Co-Facility GFE Challenge

While the No Surprises Act 2023 requires a GFE for the primary treating provider, the requirement to integrate costs from co-providers (e.g., anesthesiologists, pathologists, or radiologists) remains a significant operational hurdle, especially for facilities like Ambulatory Surgery Centers (ASCs) or hospitals. The facility is often tasked with receiving and compiling the GFEs from these separate entities.

Credentialing and Coding Impact:

1. Credentialing: Credentialing teams must ensure all providers are properly enrolled and contracted to streamline the GFE process and ensure all entities listed on the GFE are clearly identified.
2. Coding Accuracy: The GFE relies on the provider’s ability to predict the Current Procedural Terminology (CPT) codes that will be used. This demands high-level medical coding expertise and clinical intuition to accurately estimate the services required for a specific diagnosis, minimizing the risk of underestimating the final bill.

Enhanced Credentialing and Contract Management

The protections provided by the no surprises act 2023 are explicitly designed to apply only when a patient receives OON care involuntarily. This means that the safest and most profitable path for any practice is to be in-network where possible.

The Strategic Advantage of Contracting

The IDR process, while improved for providers under the No Surprises Act 2023, remains time-consuming, administrative, and expensive. The certainty of a contracted rate, even if negotiated, is generally superior to the uncertainty of arbitration.

Credentialing Imperative: Credentialing teams must prioritize and expedite the process of:

• Payer Enrollment: Ensuring all new physicians and advanced practitioners are enrolled with major commercial payers.
• Re-Credentialing: Preventing lapses in contracts that could accidentally push a provider out-of-network, triggering the complexities of the no surprises act 2023 and potentially opening the practice to IDR disputes.
• Contract Negotiation: Leveraging the data required for successful IDR (complexity, quality metrics) in proactive contract negotiations. Showing a payer that your IDR arguments are strong can lead to better contracted rates, thereby avoiding the need to use the no surprises act 2023 mechanism entirely.

CMS Clarifications on Service Scope

The No Surprises Act 2023 provides clarity on which facilities are covered for non-emergency services:

• Covered Facilities: Hospitals, hospital outpatient departments, critical access hospitals, and ambulatory surgery centers (ASCs).
• Notably Not Covered (for non-emergency services): Freestanding urgent care centers, Federally Qualified Health Centers (FQHCs), and other non-hospital based sites.

This distinction is crucial for patient communication and compliance, as providers must clearly communicate when a patient is not protected from surprise billing by the no surprises act 2023 (e.g., at an OON urgent care center that is not considered an ASC).

The Role of Medical Coding and Billing in NSA Compliance

A provider’s ability to successfully navigate the financial landscape under the No Surprises Act 2023 rests heavily on the expertise of its medical coding and billing staff.

Coding for IDR Success

The arguments made in the IDR process are only as strong as the clinical documentation and medical coding used to support them.

• Accurate Diagnosis Coding (ICD-10): When arguing for increased complexity (a permissible factor in the No Surprises Act 2023 IDR process), the provider must ensure all secondary diagnoses and comorbidities that impacted the procedure are accurately documented and coded.
• Modifier Use: Proper use of modifiers is necessary to indicate the nature of the OON service. While specific billing instructions vary, ensuring a “clean claim” that clearly identifies the service is the foundation of any subsequent negotiation under the no surprises act 2023.
• QPA Comparison: Billing specialists must be able to calculate or reliably estimate the QPA for any service, as this figure remains a benchmark in the IDR process. Knowing the QPA allows the practice to submit a strategic offer that utilizes the new permissible factors to justify a deviation above the median contract rate. The successful billing manager under the no surprises act 2023 is both a data analyst and a legal strategist.

No Surprises Act 2023 and Air Ambulance Services

A specific protection within the No Surprises Act 2023 relates to air ambulance services. These services are often OON and historically generated some of the most outrageous balance bills.

The NSA applies its OON protections to air ambulance services, meaning patients cannot be balance billed for these services.

The IDR process is the mechanism used to determine the payment between the OON air ambulance provider and the payer, using the same QPA and permissible factor considerations established in the no surprises act 2023 final rule. This is a vital consumer protection element.

Key Takeaways for the No Surprises Act 2023

The following summary points adhere to principles and provide direct, quotable answers:

FAQ on the No Surprises Act 2023

Question	Answer
What is the most significant change to the IDR process under the No Surprises Act 2023?	The most significant change is the removal of the presumptive weight previously given to the Qualifying Payment Amount (QPA). IDR entities must now give equal consideration to the QPA and all other permissible factors when determining the final OON payment rate.
Did the IDR fee change in the No Surprises Act 2023?	Yes. Effective January 1, 2023, the administrative fee for initiating the Federal IDR process increased from $50 per party to $350 per party, reflecting the high administrative burden and backlog of disputes.
Which five additional factors can providers use to argue for a payment above the QPA under the No Surprises Act 2023?	Providers can use (1) patient acuity and complexity, (2) provider/facility teaching status, (3) market share of the payer, (4) good faith efforts to contract, and (5) quality and outcome metrics to justify their proposed payment rate.
Who is protected from balance billing by the No Surprises Act 2023?	Patients are protected from balance billing for OON emergency services, and for OON non-emergency services provided by ancillary providers (like anesthesiology or radiology) at an in-network facility (like a hospital or ASC).
Is an urgent care center covered for non-emergency protection under the No Surprises Act 2023?	No. CMS clarifications under the No Surprises Act 2023 confirm that the non-emergency balance billing protections apply to hospitals and ambulatory surgery centers (ASCs), but do not extend to facilities like freestanding urgent care centers.

The evolution of the No Surprises Act 2023 from its initial 2022 rollout to the final, detailed regulations has created a more balanced, albeit complex, dispute resolution environment.

For healthcare organizations, the era of passive compliance is over. Success in the current RCM climate requires integration of medical billing and coding expertise with strategic data analysis to navigate the IDR process. 

The Bottom Line

The core takeaway from the No Surprises Act 2023 is that data is your most valuable asset. Data on service complexity, quality, and market rates is what will drive higher payment outcomes and ensure financial stability.

By proactively addressing the requirements of the no surprises act 2023, from GFE mandates to the enhanced IDR procedures, your organization can maintain profitability while remaining a trustworthy and compliant provider of high-quality care. This ongoing commitment to understanding the nuances of the no surprises act 2023 is the definition of true expertise in healthcare finance.