Negotiating Under Pressure: How IDR Is Reshaping the Business of Anesthesia

The Independent Dispute Resolution (IDR) process, established under the No Surprises Act, was designed as a backstop to resolve payment disputes between providers and payers when negotiations fail. While much of the discussion has focused on its administrative complexity and growing volume, its broader significance lies in how it reshapes negotiating dynamics in anesthesiology. In today's market, payers often hold substantial leverage in setting in-network rates, with practices (regardless of size) facing increasing pressure from contract terminations, narrowing networks, and payment benchmarks that may not reflect financial reality. The IDR process represents one of the few mechanisms that reintroduces balance into this equation, offering a structured pathway to challenge inadequate reimbursement and inform future contracting. To better understand how this process is functioning in practice, I spoke with leaders from TeamHealth and US Anesthesia Partners (USAP) about their experiences navigating the IDR process and its evolving role in the business of anesthesia. Frank Burns is the Chief Administrative Officer for USAP. Elmer Choi, MD, PhD, MBA, FASA, is Senior Vice President, Clinical Operations, TeamHealth Anesthesia, and serves on the ASA Committee on Economics and Committee on Performance and Outcomes Measurement. How does your organization decide which claims to pursue through the IDR process? USAP: At USAP, our goal is to be in network with all commercial payers and attain fair payment rates through negotiated agreements, not arbitration. The No Surprises Act established the IDR process as a backstop, and we pursue IDR only after good-faith efforts to resolve claims directly with payers have been exhausted. In many cases, arbitration becomes necessary when practices are taken out of network due to contract terminations or when proposed rates do not reflect the cost of delivering high-quality anesthesia care. We ensure claims are appropriate for IDR, investing significant resources to assess eligibility, validate data, and comply with complex federal requirements. It is time-intensive, costly, and administratively burdensome, but necessary. Ultimately, we prioritize in-network solutions and use IDR only when necessary to ensure fair and sustainable reimbursement for our services. TeamHealth: Most anesthesia groups have not built IDR capabilities from scratch, but have evolved toward them as volume and complexity increased. What began within traditional billing functions has shifted in more mature organizations to centralized workflows integrating revenue cycle, finance, and contracting. Operationally, groups have moved from manual processing to standardized submission pipelines, consistent documentation, and robust performance tracking. Metrics such as win rates, yield per dispute, payer trends, and turnaround times now inform more disciplined prioritization of higher-value cases. At the same time, documentation has become more sophisticated, with consistent incorporation of clinical acuity, case complexity, and market benchmarks into submissions. As a result, IDR is increasingly managed not as a discrete billing function, but as a strategic tool to address out-of-network underpayments while advancing sustainable, long-term in-network agreements requiring coordinated alignment across finance, operations, and contracting. What changes (good or bad) have you seen in payer negotiation or behavior since the No Surprises Act? USAP: The No Surprises Act has been highly effective in providing important protection for patients from unexpected medical bills. However, if the system were efficient, providers would not have to submit so many claims to IDR because payers would pay fairly on first submission and offer contract rates that reflect the real costs of anesthesia services. Nonetheless, the IDR process has become a routine part of how payers handle claims due to increased instances of contract terminations, narrower network strategies, and below-market payments, forcing providers into arbitration to resolve disputes and recover fair payments. The IDR process itself may be slow and resource-intensive, and delays in payment of awards remain a concern, though providers often succeed. However, these complex dynamics can create inefficiencies and uncertainty. Targeted improvements (transparency, timely payment, enforcement, etc.) would help realign the process and ensure the IDR system functions as a backstop, rather than a default payment pathway to maintain stable provider networks and protect patient access to care. TeamHealth: Since implementation of the No Surprises Act, payer negotiation behavior has become more structured and increasingly anchored to the Qualifying Payment Amount (QPA). Although intended to reflect median in-network rates, QPAs have raised concerns due to potential distortion from “ghost rates,” calling into question their accuracy and representativeness. As arbitration data has matured, both payers and providers are increasingly incorporating expected IDR outcomes into negotiations and long-term contracting strategies. Shared savings arrangements – particularly in third-party administrator models – also play a key role in shaping payer behavior. Under these structures, administrative fees may increase as reimbursement decreases, creating incentives to set lower initial payment levels. This dynamic may contribute to persistent gaps between initial payments and final arbitration outcomes. These factors provide important context for ongoing discussions around IDR volume. While some analyses attribute volume primarily to provider behavior, available evidence suggests that initial payment practices and underlying incentive structures are also significant drivers. What documentation or arguments have proven most effective in IDR cases? USAP: At USAP, we rely on comprehensive documentation to demonstrate the full scope of services required to safely deliver anesthesia care. We highlight the training and experience of our clinicians, while complying with statutory requirements. Preparation for IDR often begins before a case is filed. Providers must invest significant effort to validate claim details, reconcile incomplete or inconsistent information, and assess eligibility. Our focus is on transparency, accuracy, and compliance; we aim to ensure that determinations reflect the true value of the care our clinicians provide. TeamHealth: The operational challenges associated with IDR are multifaceted, with scale, consistency, and process clarity as the primary issues. IDR requires standardized workflows, documentation protocols, and internal analytics. Limited public data for benchmarking places greater reliance on internally generated data to assess performance across payers and service lines. Challenges also persist in process interpretation and eligibility determination. Variability in how criteria are communicated or applied can introduce uncertainty, adding administrative burden and potentially limiting participation. Effective IDR management also requires alignment across revenue cycle, contracting, and client relationships. Without this coordination, organizations risk inefficiencies or pursuing disputes misaligned with broader strategic priorities. What has been the overall financial impact of the No Surprises Act and IDR on anesthesia practices? USAP: The financial impact on anesthesia practices has been shaped largely by how the IDR process functions. Although providers prevail in the vast majority of arbitration cases, the process itself is resource intensive. Practices invest in administrative infrastructure and often wait months for resolution. Meanwhile, payers commonly set initial payments below sustainable levels, creating cash flow challenges for practices that are not fully offset upon resolution. Delays by payers following IDR determinations can further compound these pressures. These dynamics strain practice sustainability, particularly in anesthesia, which relies on stable reimbursement to support appropriate staffing. Additionally, there are broader cost implications for employer-sponsored plans – fees and prolonged dispute timelines associated with IDR – that increase overall system costs borne by employers and employees. Strengthening enforcement, particularly around timely payment and the accuracy of qualifying payment amounts, and improving transparency would help reduce unnecessary reliance on arbitration and support stable, predictable reimbursements. TeamHealth: The financial impact of the No Surprises Act on anesthesia practices reflects both structural changes and new operational requirements. The legislation addressed out-of-network billing while introducing IDR as a mechanism for resolving payment disputes. Although IDR can support reimbursement in some cases, it also introduces additional administrative and transactional costs, including fees, staffing, and infrastructure. These costs are not uniform. Larger groups are better positioned to absorb them through scale and process optimization, while smaller practices may face greater barriers to participation. At the same time, IDR has helped support more balanced payment determinations, particularly when initial payments based on QPAs may not reflect market rates. Concerns remain regarding QPA calculations, including the use of “ghost” rates that may contribute to lower initial reimbursement. Overall, the financial impact of the No Surprises Act and IDR reflects reduced reimbursement variability, increased operational costs, and the establishment of a structured dispute resolution framework. What changes in the IDR landscape should anesthesiology groups expect over the next few years? USAP: We expect continued evolution of the IDR landscape as policymakers and regulators address implementation challenges. There is growing recognition that certain aspects of the process require refinement. Legislative efforts such as H.R. 4710 and its Senate companion, S. 2420, represent important steps toward strengthening accountability by introducing penalties for delayed or nonpayment of IDR awards. We would encourage physicians to reach out to their members of Congress to support this legislation to level the playing field, ensuring that providers can enforce IDR awards in court when payers fail to comply. The Fifth Circuit Court of Appeals ruled last year that providers cannot file private lawsuits to enforce payment IDR awards; this must be addressed legislatively. Payers have the right to go to court to avoid payment of awards – a right they are attempting to use. TeamHealth: The IDR landscape will likely continue to evolve as policymakers, payers, and providers assess its operational performance and broader economic impact. Policy and academic discussions have increasingly focused on the drivers of IDR volume and cost. While some emphasize provider behavior, others highlight structural factors such as initial payment levels and incentive models, including shared savings arrangements. A balanced interpretation will be important in shaping future policy decisions. Looking ahead, key areas of focus include greater transparency in QPA calculation, improved data availability, and refinement of arbitration processes to reduce uncertainty and improve consistency. Ongoing engagement from provider organizations will remain essential to ensure policy discussions reflect the full range of operational and economic considerations. IDR remains a central mechanism for resolving payment disputes, and its long-term effectiveness will depend on maintaining credibility, transparency, and alignment with market-based evidence. The experiences of TeamHealth and USAP underscore that IDR is as much about structure and strategy as it is about individual claims. What began as a backstop has become a lens through which broader market dynamics are revealed. For anesthesiologists, understanding this evolution may be key to navigating the future of the specialty. ASA Disclaimer: The views and opinions expressed in this article are those of USAP and TeamHealth, ASA Group Practice Supporters, and do not reflect the official policy or position of ASA. It should not be interpreted as an endorsement by ASA. The article has been reviewed and approved for publication by the ASA Monitor Editorial Board.George Tewfik, MD, MBA, FASA, ASA Committee on Patient Safety and Education, ASA Committee on Practice Management, ASA Committee on Quality Management and Departmental Administration, Associate Professor, and Director of Quality Assurance, Department of Anesthesiology, Rutgers-New Jersey Medical School, Newark, New Jersey.