A federal fix launched to settle billing disputes between doctors and health insurers has largely protected consumers from surprise medical bills.
But the solution, an arbitration process, has done little to reduce health care costs, which means consumers could pay in another way — pricier health insurance premiums, according to a new Georgetown University analysis of No Surprises Act arbitration awards.
The Arbitration System’s Costs Are Rising
The arbitration process cost more than $22 billion in payments to medical providers and related costs since 2022, the analysis said. In 2025 alone, the arbitration system cost $16.6 billion, or more than triple the amount paid in 2024, according to the analysis, published Aug. 26 in Health Affairs Forefront.
Congress passed the No Surprises Act in 2020 amid growing complaints from patients hit with big medical bills by doctors who weren’t in their health insurer’s network of providers. The legislation focused on care in hospital emergency rooms and pricey air ambulance rides. A common scenario involved patients who sought care at hospitals in their insurer’s network only to be billed by out-of-network doctors, specialists or other medical providers.
While the arbitration system has protected patients from surprise bills, it’s accelerated health care spending despite a Congressional Budget Office projection it would save money and lower insurance premiums, said Jack Hoadley, a research professor at Georgetown’s Center on Health Insurance Reforms and a co-author of the analysis.
“The system has failed to meet that cost-containing goal,” Hoadley said. “Enormous (arbitration) costs inevitably add to the insurance premiums paid by consumers, and we’ve already seen some employers attributing a portion of their premium increases,” to arbitration costs.
How Does Arbitration Work?
The law removed patients from these billing disputes. Patients still must pay the copays, coinsurance and deductibles required by their insurance plan, but they should no longer be directly charged the bill’s balance.
Doctors who aren’t satisfied with the amount the insurance plan offers can seek arbitration. Cases are decided by baseball-style arbitration — a process in which the arbitrator must award either the amount proposed by the insurance plan or what the medical provider asks. The arbitrator can’t split the difference; they must award either the insurer’s proposed payment or what the medical provider seeks.
Since arbitration began in 2022, doctors have won a vast majority of cases. In 2025, medical providers won 85% of disputes and were awarded payments four times what they would have collected from the insurer’s median, in-network rates.
Perhaps due to their outsized success winning lucrative awards, doctors are increasingly choosing this path to collect payments. In 2025, medical providers brought 2.6 million disputes, up 77% from 2024. That case volume is far more than the federal government’s initial estimate of about 22,000 disputes per year.
The medical providers also are taking in lucrative awards. In 2025, payments jumped 264% from 2024, the Georgetown analysis said.
The combination of more cases, higher awards and administrative costs have sent the overall price tag soaring. From 2022 through 2025, the system cost $22.4 billion in extra awards, arbitrator fees and administrative expenses, the Georgetown analysis said.
The Georgetown analysis found more than three-fourths of awards involved three physician and middleman organizations — Radiology Partners, HaloMD and TeamHealth.
HaloMD, which files disputes on behalf of providers, is the largest middleman organization involved in arbitration cases. The Georgetown analysis said HaloMD has “boasted of winning $2 billion in award determinations for provider clients,” and won 90% of cases.
In a statement, HaloMD’s Chief External Affairs Officer Patrick Velliky said the company “facilitate(s) access to sustainable reimbursement” for more than 27,000 doctors and clinicians nationwide.
“We’re proud to help provide the means for these groups to remain independent and continue serving their communities,” Velliky said.
Radiology Partners, a national radiology doctors practice, said in a statement that the Georgetown analysis “misses the mark by failing to address the underlying factors driving physicians to request arbitration in the first place.” Radiology Partners quoted a judge who cited insurers’ “lowball offers to out-of-network providers in an effort to maximize” profits.
Will Arbitration Inflate My Insurance Bill?
Insurers, in advocacy materials, court filings and earnings calls, have sounded the alarm on the potential impact of arbitration awards on health care costs.
The New York state budget document said out-of-network providers are using arbitration under the No Surprises Act and similar state legislation to maximize revenue. The arbitration added more than $200 million in claim payments to the health insurance plan for state employees and families. The budget document said the arbitration awards are a “primary contributor” to the 2027 state health plan’s premium increase of nearly 10%.
The Georgetown analysis cited two other examples of insurers raising rates. The United Service Workers union plan raised premiums another 1.75 percentage points to offset arbitration awards and fees. A United Healthcare official said the arbitration added 2% to 6% in premium expenses for privately insured customers.
“We’re definitely concerned about downstream impacts on premiums,” Hoadley said.
Most Americans get health insurance through the workplace, and recent surveys suggest those costs soared this year at the highest levels since 2010.
A survey released earlier this month reported more than 4 in 10 adults cited the cost of health insurance as the biggest problem that needs to be fixed in the U.S. health care system. People also lamented the amount they spend on copays and deductibles for health expenses such as medical bills, lab tests or prescription drugs.