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Providers Beware: Court Sides with Insurers in No Surprises Act Arbitration

Client Alert
July 2, 2025

On June 12, 2025, the Fifth Circuit ruled in favor of Aetna and Kaiser Foundation Health Plan (Kaiser) in a pair of cases filed by air ambulance providers challenging the No Surprises Act’s (NSA’s) Independent Dispute Resolution (IDR) process’ resolution of payment disputes. The NSA is a federal law seeking to protect patients from expensive and unexpected medical costs when seeking out-of-network care. To that end, the NSA created an IDR process for out-of-network providers and insurance companies to utilize to resolve payment disputes between the parties.

In this case, the air ambulance providers argued that Aetna and Kaiser miscalculated the providers’ Qualifying Payment Amount (QPA) during IDR. The QPA is the rate used to settle out-of-network claims. According to the providers, Aetna and Kaiser intentionally calculated and utilized a low QPA during the IDR process, potentially skewing the arbitrator’s findings as to the correct amount the insurers were required to pay for air ambulance care.

However, the Fifth Circuit disagreed with the providers, holding that, while the NSA permits limited court review of IDR outcomes, legal challenges to IDR decisions must be based on clear evidence of fraud or serious misconduct. The Fifth Circuit also ruled that the third-party arbitrator was immune from suit for their decisions in the IDR process.

Following this ruling, it is clear that courts will not second-guess the decisions made during IDR absent clear evidence of fraud and serious misconduct.

The case is Guardian Flight, L.L.C. v. Aetna Health, Inc., No. 24-20204 (5th Cir. 2025).

To learn more about the NSA and its IDR process, please contact BMD Healthcare Member Daphne Kackloudis at dlkackloudis@bmdllc.com or Attorney Jordan Burdick at jaburdick@bmdllc.com.

Health LawHealthcareDaphne KackloudisJordan Burdick
Client Alert

Substance Use Disorder Providers: 42 CFR Part 2 Now Enforceable

April 15, 2026Updates to 42 CFR Part 2 are now enforceable, bringing significant changes to how substance use disorder (SUD) records are handled. The Final Rule aligns Part 2 more closely with HIPAA, introduces updated penalties, allows a single patient consent for treatment, payment, and operations, and adds new requirements for Notices of Privacy Practices. It also creates a formal definition of SUD counseling notes and imposes strict consent requirements for their use and disclosure. Providers should review and update policies to ensure compliance.Client Alert

AAA Introduces AI-Assisted Arbitrator for Certain Disputes

April 7, 2026The American Arbitration Association has introduced an AI-assisted arbitration platform designed to streamline certain document-based disputes. While a human arbitrator still makes the final decision, the technology can improve efficiency, reduce costs, and accelerate case resolution. Companies should weigh these benefits against considerations such as transparency, risk, and contractual requirements before adopting AI-assisted arbitration.Client Alert

Quiet Hours Texts and TCPA Claims: Consent Remains King as Courts Divide on Text Messages

March 31, 2026Businesses face increasing TCPA lawsuits over off-hours marketing texts, but recent court decisions highlight strong defenses. Clear consumer consent and updated terms and conditions can defeat many claims, while a growing number of courts are finding that text messages are not “telephone calls” under the statute. Proactive compliance measures, including clickwrap agreements and forum-selection clauses, are critical to reducing risk.Client Alert

New Ohio Reporting Requirements for Non-Residential Contractors

March 18, 2026Ohio’s E-Verify Workforce Integrity Act, effective March 19, 2026, requires all nonresidential construction companies, subcontractors, and labor brokers to use E-Verify to confirm employee work eligibility on projects across the state. The law applies regardless of company size and carries financial penalties and potential restrictions on future state contracts for noncompliance. Some uncertainty remains around requirements for existing employees, making early compliance planning important.Client Alert

DOT Non-Domiciled CDL Rule

March 11, 2026A new rule from the Federal Motor Carrier Safety Administration (FMCSA) will significantly narrow eligibility for non-domiciled Commercial Driver’s Licenses (CDLs) beginning March 16, 2026. The rule limits eligibility to holders of H-2A, H-2B, and E-2 visas and eliminates Employment Authorization Documents (EADs) as qualifying proof of work authorization. As a result, many lawfully present and work-authorized immigrants, including refugees, asylees, DACA recipients, and Temporary Protected Status holders, will no longer be able to obtain or renew a non-domiciled CDL. The change is expected to affect roughly 194,000 drivers nationwide and has prompted multiple legal challenges, including a pending emergency stay request before the United States Court of Appeals for the District of Columbia Circuit.
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